How the hell did you get me defending Wall Street out of that last comment? I have a pretty good grip on the overall global economic situation. Unlike yourself, I can accept the fact that the economies of individual nations do not operate independently as islands, as was the case 50-60 years ago. That is why unsustainable LU contracts and raising taxes to cover ever increasing govt spending won't work anymore. It will put the US govt into default and we'll all be fucked in the end. 50 years ago, when US companies weren't competing globally, the LU's could bargain up their wages and benefits and the costs would simply be passed onto the consumer. However, that doesn't work in a Wal Mart world.
Those countries with the more competitive corporate tax rates and less threat of strangulation by labor unions will enjoy the benefits of more international business setting up shop on their shores. Not saying that's a good thing necessarily to have US workers forced to compete with Chinese laborers earning 60 cents per hour plus lunch. But, with globalization and "free trade", that's what we have now. The US isn't Luxembourg. We have a diverse population, 620 times their size.
In 2010 the Fed collected 190B from US corporations and gave out 100B in tax give-away's according to the Cato Institute that is about the annual average. With total Corp earnings of 1.7T in 2010 that is an effective tax rate of 5%. Obviously that rate on paper and what they actually pay are not even remotely similar.
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the US budget deficit is a direct result of increased imports over exports and maintaining a low national savings rate for decades, it has nothing at all to do with over/under taxation.
Basic national income accounting requires that
Y = C + I + G + (EX - IM),
where Y is GDP, C is consumption, I is investment,
G is government consumption, and EX - IM is net
exports (exports minus imports).
C = Y - T - S simply states that consumption is
equal to GDP minus taxes and saving.
Putting these two equations together, we find
another national income identity:
Y = Y - T - S + I + G + (EX - IM)
Rearranging, we find that
(IM - EX) = (G - T) + (I - S)
Thus, the country’s trade deficit is equivalent to the
country’s government budget deficit (G - T ) plus the
country’s private investment/savings imbalance (I - S).
This is an accounting identity, not a theory, and as
such, it holds for all countries at all times. It also
implies that measures that increase the government
deficit or the private sector’s investment/savings
imbalance will necessarily worsen the trade deficit.
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Privatization, Entry Regulation and the Decline of Labor’s Share of GDP: A Cross-Country
Analysis of the Network Industries
http://eprints.lse.ac.uk/4552/1/Pri...ountry_Analysis_of_the_Network_Industries.pdf
The Conclusion is on page 30 if you don't feel like reading the entire document.
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The report from the Frazer Institute shows that the US has a very efficient government when compared to other OECD countries and especially when you consider the population of the US is 3x larger than most other OECD countries with the exception of the developing economic countries such as India and China.
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The graph of U.S. Interest Rates and Flow of Funds show the direct result of monetary policy of the FRB and it's effects on Government Savings.
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The last document (0406 macroeconomics bosworth) shows the Avg Savings rates over time
sorry if i exhausted you with facts.
