Perhaps Obama truly is an idiot?? After all, he did say that people turn to religion because they are bitter. He’s not the brightest bulb.

That could explain the jump in corn prices, yes. It doesn’t explain the increased price of rice and wheat very well. That’s more likely tied to the rising cost of oil.

But to get back to the ethanol boondoggle: it has effects all throughout the economy. Higher corn prices mean it’s more expensive to feed cattle, which raises the price of beef and dairy. I really don’t see any positive results from the ethanol initiative.

Yeah, but I think the reality is that Obama doesn’t believe it would really reduce total tax revenue. It’s a counter-intuitive and Obama’s not an economist so we shouldn’t expect him to understand a strange idea that is in stark contrast to his worldview.

Darius T said: [Obama is] not the brightest bulb.

Yeah. He’s smart enough in some areas. But he seems to have some pretty big blind spots. E.g., a genuine understanding of religion. Sure he’s religious, but as he said himself, it’s all about the social gospel. Genuine belief in spiritual things seems to be foreign to him, at least from what I can tell from his public statements.

My somewhat off-topic comment is not about race, really, it is about culture. This is an area that I think some people are confused. Obama’s mother was white, his father was African–not African-American. Obama grew up in Hawaii and Indonesia, with lots of Asian influence. He did not grow up in a culture even remotely like what we think of typical for American blacks. So when people talk about “Oh, wow, we’re going to have our first black president” that doesn’t mean we’re having a president who shares a cultural heritage with those whose forebears were slaves. It just means people are making a comment STRICTLY about the color of his skin. Big deal what color your skin is.

That could explain the jump in corn prices, yes. It doesn’t explain the increased price of rice and wheat very well. That’s more likely tied to the rising cost of oil.

True, I wasn’t addressing that. It’s bound to have an effect in the future though as the U.S. has less food to send to poorer countries (because it’s being turned into ethanol). It’s also worth pointing out that U.S. tariffs prevent the importing of Brazilian sugar-based ethanol that is much more cost effective that corn based ethanol.

the capital gains tax always seems to be the whipping boy for this valid but deliberately mistated theory to be played out. the trick is in what mark twain described as the three kinds of lies “lies, damn lies, and statistics”. establish your statistical basepoints in the correct place and you can prove the moon is made of green cheese.

the only true way to calculate the effects of a capital gains rate increase or decrease is to track the collections vs rate vs economic activity (you must eliminate extra collections due to big changes in all collections ie the dot com bubble). some economists also believe that you must factor the stimulus of large deficit spending amounts, like after the reagan and bush tax cuts, into this. studies taken over a period long enough to ameliorate the one time bounce of people taking long term capital gains immediately after a cut or immediately in front of an increase make the supply siders arguments a LOT less clear cut.

the treasury department has done some pretty comprehensive studies on this that are interesting but universally ignored, since simple facts don’t fit into anyones preconceived ideological arguments. the truly onerous thing about capital gains taxes, which no one is discussing fixing since it is not a sexy sound bite issue, is that they are not indexed for inflation. you pay tax on true total capital gains plus the inflation.

disclaimer before darius calls me an idiot again, i am not advocating an increase in the capital gains tax. i am just pointing out that everyone in this interview is talking out their respective anal orifices. gibson, while technically correct that capital gains collections do jump right after a tax cut, is just another talking head not an economic brain surgeon. although i would never vote for obama i have bothered to read his (somewhat tedious) book. although he is much weaker on economics than i would like (as is mccain), he does understand this issue. so i am mystified how he gave such a poor response instead of calling gibson to the table on it. i fail to find in obamas writing, speeches, voting record, or even this interview where he could care less about how government works and is more interested in the ideals of socialism. obama is the strongest candidate the democraps have had in decades. people who lightly dismiss him as an idiot run a real risk of having him as president.

http://www.cbo.gov/doc.cfm?index=3856&type=0

This is an honest area for economic debate. This doesn’t mean that government should raise taxes if doing so will increase total revenue. Just because they COULD raise more money by raising tax rates wouldn’t mean they SHOULD. This is really nothing more than a supply/demand curve though. At some point, business owners will be taxed so highly that they will no longer be willing to provide the service of their business to the economy. Government/Organized Crime have always had to walk this balance when selling protection. You want to get money from your clients, not drive away business.