INT 200: Global Capitalism and its Discontents Industrial Capitalism.
Prosperity and Capitalism. America’s Oil Boom Reaganomics Vs. Obamanomics.
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Transcript of Prosperity and Capitalism. America’s Oil Boom Reaganomics Vs. Obamanomics.
Prosperityand Capitalism
Stephen Moore
America’s Oil Boom
Reaganomics Vs. Obamanomics
Obama Jobless Recovery
Red States Vs Blue States
Growth States Vs Declining States
Texas - 1.1 Million Jobs CreatedRest of the U.S. - 350 Thousand Jobs
Lost
The Greatest Story Never Told
- 64 % + 1,500%
America’s Boom and Bust
0%
10%
20%
30%
40%
50%
60%
70%
80%
0
5
10
15
20
25
30
35
40
45
Top Marginal Income Tax Rate Top 1% Income Tax ShareYear
Top
In
com
e T
ax S
hare
1%
In
com
e T
ax S
hare
“In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and
the soundest way to raise the revenues in the long run is to cut
the rates now.” - John F. Kennedy
Address to the Economic Club of New YorkDecember 14, 1962
Income tax rate
Capital Gains
Dividends
Death Tax
0.00% 10.00% 20.00% 30.00% 40.00% 50.00%
41%
24%
24%
40%
35%
15%
15%
35%Old Rate Obama Rate
TaxmageddonTax Rates Under Obama in 2013
Barack Obama Simplified tax form
Source: Internal Revenue Service, Statistics on Income, “Number of Returns, Shares of AGI and Total Income Tax, AGI Floor on Percentiles in Current and Constant Dollars, and Average Tax Rates,” Table 1. Available at: http://www.irs.gov/taxstats/indtaxstats/article/0,,id=133521,00.html
Past performance is no guarantee of future results.
Bottom 95 Percent Pays Less than Top 1 Percent
Rich Pay More Than Their Fair Share2010 Income and Income Tax Shares
Source: Internal Revenue Service, Statistics on Income, “Number of Returns, Shares of AGI and Total Income Tax, AGI Floor on Percentiles in Current and Constant Dollars, and Average Tax Rates,” Table 1. Available at: http://www.irs.gov/taxstats/indtaxstats/article/0,,id=133521,00.html
Past performance is no guarantee of future results.
Income Share Income Tax Share0
5
10
15
20
25
30
35
40
19
37
11
2
Top 1% Bottom 50%P
erc
en
t
The Laffer Curve
Normal Range
Prohibitive Range
100%
0%
Tax R
ate
Tax Revenue
Inflation Rate, 1950-2013
Past performance is no guarantee of future results. Source: http://research.stlouisfed.org/fred2/graph/?id=CPILFESL,
Past performance is no guarantee of future results. Source: Federal Reserve Bank of St. Louis, Monetary base Growth, Available at: http://research.stlouisfed.org/fred2/series/BASE
Helicopter BenYear on Year Monetary Base Growth, bi-weekly, percent, through June 2013
QE0
QE1
QE2
Source: http://research.stlouisfed.org/fred2/graph/?id=DGS10,# Past performance is no guarantee of future results.
10 -Year Treasury Note yield Jan 1960 to June 2013
real interest rate on 10-year U.S bondsJan 2003 to June 2013
Source: http://research.stlouisfed.org/fred2/graph/?id=DGS10,# Past performance is no guarantee of future results.
All Items Education Medical Care
Energy New Ve-hicles
Apparel Software Computers-100%
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
24%
70%
44%50%
-5% -6%
-39%
-76%
Source: BLS
Education and Medical Prices Skyrocket While Import Prices Drop
CPI, Percent Change, 2000 to 2009
Past performance is no guarantee of future results.Bureau of Labor Statistics, Consumer Price Index, Available at: http://www.bls.gov/data/#prices
Worker Well-Being
Past performance is no guarantee of future results. Based on data from the Census Bureau and the Department of Labor.
Past performance is no guarantee of future results.
Number of Years It Took for Major Technologies to Reach 50% of American Homes
High Technology
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
Defense Spending
Total Nondefense Spending (Discrestionary and Mandatory)
Guns and Butter: Federal Spending Explodes1995 – 2010
Past performance is no guarantee of future results.Source: Congressional Budget Office, Historical Budget Data, Available at: http://www.cbo.gov/
Nondefense
Defense
Billion
s o
f U
.S.
Dollars
Pissed Away15%
Down a Rat Hole24%
Sleaze8%
Corruption15%
Postage Stamps6%
Given to "Sup-porters"
19%
Tossed Down the Drain6%
Flushed Down a Toilet8%Chart Title
Source: IRS, GAO, BEA, BLS, CEA, JEC, ETC.
Where does your federal tax dollar go?
High Corporate Taxes Make the U.S. UncompetitiveU.S. Corporate Tax Rate v. Average for Developed Countries
Past performance is no guarantee of future results. Note: The bars are the average tax rate in the rest of the world.Source: OECD Tax Policy Analysis
1990 411991 401992 37.91993 381994 371995 371996 36.71997 36.71998 35.71999 34.82000 33.62001 32.52002 31.22003 30.72004 29.82005 28.62006 28.12007 27.62008 26.62009 26.292010 25.22011 25.12012 25.12013 25.1
25
30
35
40
45
Co
mb
ine
d C
entr
al
and
Sub
ce
ntr
al
Go
ve
rnm
ent
Co
rpo
rate
Ta
x R
ate
U.S. Corporate Tax Rate v. Average for Developed CountriesU.S. Combined Federal and State Tax Rate
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
20
25
30
35
40
45U.S. Corporate Tax Rate v. Average for Developed Countries
Co
mb
ine
d C
en
tra
l an
d S
ub
cen
tra
l Go
v-e
rnm
en
t Co
rpo
rate
Ta
x R
ate
U.S. Combined Federal and State Tax Rate
1970 1975 1980 1985 1990 1995 2000 2005 2012
Past performance is no guarantee of future results.
Gold PriceJanuary 1970 – January 2013
Reagan-28%
Bush4%
Clinton-19%
Bush 236%
Carter316%
Nixon/Ford276%
Obama 46%
Economic Freedom and Income
Source: EFW 2012, Exhibit 1.7.
Least Free Quartile
3rd Quartile 2nd Quartile Most Free Quartile
05,000
10,00015,00020,00025,00030,00035,00040,000
$5,188 $6,596
$16,957
$37,691
$25,062
$13,789
$6,404 $5,062
78.7
69.9
64.8
56.7
40.0
45.0
50.0
55.0
60.0
65.0
70.0
75.0
80.0
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
Most Free Second Third Least Free
Life
Exp
ecta
ncy a
t Birth
, 20
05
G
DP
pe
r C
ap
ita,
PP
P, 2
00
5
(C
onsta
nt 2
00
0 Inte
rnatio
nal $
)
Life Expectancy
Source: Cato Institute and Fraser Institute, Economic Freedom of the World, 2007.
Economic Freedom Past performance is no guarantee of future results.
Free Countries are Wealthier and Healthier
Source: Federal Reserve Bank, Nominal Major Currencies Dollar Index Past performance is no guarantee of future results.
Dollar at Record LowsDollar Index, August 2000 – November 2012
2000-01 2001-01 2002-01 2003-01 2004-01 2005-01 2006-01 2007-01 2008-01 2009-01 2010-01 2011-01 2012-0165
70
75
80
85
90
95
100
105
110
115
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Majo
r C
urr
en
cie
s D
ollar
Ind
ex N
um
ber
National Debt by President and Control of Congress
Source: http://advisorperspectives.com/dshort/updates/Debt-Taxes-and-Politics.php?federal-debt-to-gdp-politics-update
Actual vs. Expected unemployment rate:2009-2013 UNDER PRESIDENT OBAMA
Source: "The Job Impact of the American Recovery and Reinviestment Plan," 2009, president's Council of Economic Advisers; Bureau of Labor Statistics, Labor Department. Graphic: The Washington Post. Published Oct. 7, 2011
7.9%