Just yesterday, as talks over taxes and spending grew a little louder in Washington, House Speaker John Boehner (R-Ohio) cited an "independent" report that found tax increases on the wealthy would "cost our economy more than 700,000 jobs."
The argument, not surprisingly, was debunked months ago. But the rhetoric raises a worthwhile question: what would happen if a bipartisan agreement fails to materialize, and tax increases automatically kick in on Jan. 1?
Yesterday, the non-partisan Congressional Budget Office reported the looming tax hikes and spending cuts would undermine the economy in 2013, but the "least harmful component of the coming fiscal consolidation is precisely what Democrats are demanding: the expiration of the Bush tax cuts for high earners."
CBO doesn't examine the top bracket Bush tax cuts directly. But it does look at two competing scenarios: One where all of the expiring tax cuts except for the payroll tax cut are extended; another where all of the expiring tax cuts except for the payroll tax cut and the Bush tax cuts for top earners are extended.
The former, CBO says, would increase employment by 1.8 million full time equivalent employees in 2013 relative to allowing everything to lapse. The latter would increase employment by 1.6 million. The difference, 200,000 full time equivalent jobs, is attributable to the expiration of the top bracket Bush tax cuts alone.
By comparison, other layers of the fiscal cliff save less money and have far greater economic consequences. Failing to extend the expiring payroll tax cut and expiring emergency unemployment benefits through 2014 would cost the economy about 800,000 jobs, according to CBO. The two halves of the sequester -- the defense cuts and the domestic cuts -- would each cost the economy about 400,000 full time equivalent jobs.
So, according to the CBO, the Democratic priorities do more to help the economy, and the Republican priorities do less. The 700,000 figure cited by the House Speaker has no basis in reality at all.
Maybe Republicans will try to suppress this, too?
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Unless you are worried about the economy of the Cayman Islands, or maybe Switzerland.
http://www.dpcc.senate.gov/files/documents/CRSTaxesandtheEconomy%20Top%20Rates.pdf
and we also know that it is a total shame about tax cuts as well, this needs to be brought up and hammer home as well!
"Maybe Republicans will try to suppress this, too?"
Speaker Boehner is already out in front dispensing lies. Somewhere I'm hearing Hannity about to go off the rails repeating the lies......Meanwhile in reality, the American people have already spoken - TAX THE RICH & CORPORATE, it's about equality and about time!
Do you not get it? The CBO report says taxing the rich does cost jobs. Real jobs for middle class Americans. We had this $900 billion stimulus to get what, maybe a million jobs? And no one cares about creating 200,000 jobs a year for a $200 billion tax increase. If you look at the numbers it is the same number of jobs per billion dollars. You would hurt 200,000 middle class people annually just to soak the rich?
Ah, the cliff... well, actually the bump. Time to get over it. NOT a cliff. Big bump. Maybe.
In the previous episode, Grover Nonsense was reeling about the thought of letting his millions in tax breaks go out the window and his minions of pledge-signers go out the door...
He needn't have worried about all the tax INCREASES he was ranting about coming to reality. There would have been no tax increases in the first place.
Simple Logic... Looking at it this way...
It was a dark and dreary night...Midnight approaches.
It’s a quarter of midnight on Saturday. You go into a market for a cake, the cake you want is marked down. You pick it up, go get in line. Couple of people in front of you, you wait. You get to the cashier a little past midnight. You have the money in your hand, give it the the cashier. He says “you didn’t give me the correct amount.” You question why it’s more. “Because it’s been on a temporary markdown for the past week, now it’s Sunday and it goes back to the original amount.”
OK. The wealthy were paying taxes at a certain level. They were given a temporary reduction in the amount of the taxes they would pay. Now it‘s the agreed upon number of years later, and the temporary reduction comes to an end. Tax reduction is over, back now to original levels. Grover howls... “WAIT! You’re raising taxes. You can’t do that., that’s a tax increase!”
Wrong, Grover. There was no tax INCREASE involved here. The amount owed was due to an agreed on REDUCTION, now the reduction has ended as agreed to, and now reverts BACK to the ORIGINAL amount. That’s NOT an increase. They got a ten-year REDUCTION. Won’t even mention they lucked out and got two more years. (Possibly making up for a change in the rate? Is there a change in the rate? In whose favor?)
Looking at it differently, it’s just like at the market. The reduced price time ran out, and the it reverted to its original amount. Piece of cake.
It was a dark and dreary night. Listen... you can hear the frogs croaking... or is that Grover?
Taxing the rich does not cost us jobs-it makes us jobs. I'm a small business owner and only 3% of small business owners are make $250,000 and more so since we are the real job creators it will have very tiny teeny affect that you will not even notice. The rich really 11% in taxes (forget the 35% on paper-it was meant to deceive the public. After they lobbied for all their loopholes and deductions, it's really 11%) and sometimes much less or 0. But if we make them pay only 30%, but really pay it and do the same for corporations, it brings 1.9 trillion dollars a year in extra revenue. This is the real reason for the deficit and this would give us a 1/2 trillion dollar surplus year after year. That's a lot of infrastructure building and that means a lot of jobs. At, 50 grand a year, we could hire 12.5 million people in the very first year that we actually collected the full amount of taxes from the wealthy. But we do need material and I don't have figures on that, so lets save half for material, which means if we raised the tax rate to 30% and cut the deductions and loopholes, then we'd have an immediate 6.25 million jobs each year from just having the rich actually pay even less of a tax rate of the middle class. I am tired of the Republican saying "Oh, if we taxed the rich more it wouldn't make a difference. So you all don't do the numbers. If you did, you would see what a liar they are and it sure does make jobs and infrastructure at the same time.
So did everybody. So OK lets use you logic on everybody and get back to the Clinton taxes which by the way brought in much more money from the lower 98% than it did from the top 2%. the lower 98% is where the real revenue is.
President Obama just spoke with the press about the fact that the Senate has already passed legislation extending the Bush tax cuts for families making less than $250,000, and that if the House would pass the legislation too, then he could sign it and get it done.
We need to remind Americans that House Republicans are holding tax cuts for the 98 percent hostage in order to get tax cuts for the top 2 percent. There should be no confusion about this.
Excuse me, wasn't the Clinton prosperity based on all the Clinton rates not just some?
Having everyone under Clinton rates shouldn't be too bad, they were mostly for the rich right? If I'm going to suffer, everyone else has to as well. It's called fairness.
The fiscal derangement of the Rape-Public-CON Party over thirty years has spread the gap of wealth inequality in our country to a degree unseen since the "Gilded Age" of the late nineteenth century.
So yeah, now you can "suffer" a little, poor baby! At least you're right about one thing (for a change) - "It's called fairness"!
Got Enraged and Engaged:
Mooched the Vote 2012!
;-)
I make less than $250,000, but yes Shooter, I would be fine with everyone going back to the Clinton-era tax rates.
If it wouldn't throw the country into recession, I'd be fine with the whole "cliff."
Let's see, the President and the House Republicans before election:
President: I want to raise the tax rate (by expiring tax cuts) on those making more than 250,000.
House Republicans: We do not want to raise taxes on anyone.
The President and the House Republicans after the election:
President: I still want to raise the tax rate (by expiring tax cuts) on those making more than 250,000.
House Republicans: We will consider raising taxes, just not the rates. Let's find ways to make those making 250,000 or more to pay more taxes by eliminating some of the loopholes and deductions they use and don't need.
Seems like the House is moving toward compromise and the President is still saying it is my way or I'm going to blame you!
RobDon - You are aware that the eliminations of loopholes and deductions is ROMNEY'S plan, right?
You don't lose and still get to implement your ideas, it doesn't work that way.
Well actually it seems some 30 million tax payers will be subject to Romney's tax reform plan, commonly known as the AMT.
Glad to see we can agree on Clinton rates for everyone, considering we're already in stagnation, we might as well go through the sequester as well.
But hey, I'm in favor of not extending the debt ceiling either. How odd it is that the fix for the last debt ceiling battle is farther off than the coming debt ceiling battle.
Loopholes and deductions the middle class frequently take advantage of, like the Mortgage deduction. Loopholes are usually not a staple of the middle class, we don't make enough to benefit from a loophole or two.
In essence, you're sticking it to the middle class, the wealthy have havens to drop their excess money into, avoiding loopholes entirely, that's money that will not be taxed, and they know it.
3% is not much to someone making $250K or more a year.
Extend the middle class tax cut for two years, let the $250K tax cut expire December 31, and trim some of the cost reductions to make it all more palatable. Back away from the fiscal cliff slowly, that way you won't slip on the rocks and fall.
"Having everyone under Clinton rates shouldn't be too bad, they were mostly for the rich right? If I'm going to suffer, everyone else has to as well. It's called fairness."
I don't see how paying a little more will cause families making $250K+ to sufer. Some of us are already sufering enough, thank you. Try making ends meet on barely above minimum wage. Not due to our poor decision-making, but the economy that tanked in 2008 (causing layoffs locally), under the previous president.
Right. Everyone has to "suffer" is Shooter does, because clearly not being able build a third vacation home would be just the same as a family of four making 50K not being able to afford braces for their kids.
There are deductions and loopholes that only the top earners take advantage of...and you can still structure the plan so that it does not affect those under 250,000 by capping total deduction.
As to Katherine, yes I realize this was part of Romney's plan but it was not the House Republicans, they were saying NO revenue increase. This is a way for the President to get the rich to pay more and for the Republicans to not have tax rates increase. It is called a win-win but it will never work in Washington.
Sorry folks but you're the ones who voted for Obama. Now it's going to cost you.
LOL
coming from a couple who said Romney was going to win and win big and he has all the numbers and they are going his way.
LOL some at you, for even acting like you have a idea of the numbers.
Thank you for your contribution Shooter and keep up the good work. I know it would be hard on most if the rate went up on the middle class but I would rather see my taxes go to help create jobs and reduce the deficit than to pay for some kock bro wannabe's tax cut. The teabaggers are cutting thier own throats once again and the President is handing them the knife. These idiots wrote the book on stupidity.
If I was Speaker Boehner, stuck in an unwinnable situation. Knowing the President isn't letting go of the end of the Bush Tax Cuts for the Top 2 Brackets, and Grover's Pledge to never raise taxes. If I was him, I'd hold off on a deal for as long as I could. Because he can't win anyway. So instead of brokering a deal that raises taxes, I'd let them all run out, fall right off the cliff, and cut a new deal in Jan. That keeps the tax cuts for everybody but those in the top two brackets, and sell it as a tax cut to middle income families.
One name:
Grover Norquist. A tubby, squeaky little man who wields the staff of power over our legislator's heads, in the most blatant form of form of extortion: "Do as I say or you will not have a job here."
They fear this man, they value their jobs in Congress more than they value this country. They will sell us down the river to keep their precious seats in the House.
Grover would be whittled down to an insignificant pipsqueak if they stood against him and called his bluff.
It's as simple as that.
Not one of them has the backbone to try it.
Grover Norquist's goal is to destroy the United States of America. He is guilty of treason and should be in jail.
Whattaya know, Basketball Boy still can't score from the free throw line.
Who is this Don our other little troll-boy wants to rob?
Boehner's outlandish use of a debunked report, and FOX's assertion that President Obama's reelection has resulted in massive layoffs make it fairly evident there are some among us who are struggling mightily trying to get out of that wet paper bag known as fact-free-Tea-Partying-Murdoch-land!
Let our taxes go back to the Clinton rates - us poor people probably won't notice a bit of difference as we make the necessary adjustments. As for those born on third base? Well I imagine they will be a flailing around in confusion and rage as they may have to put off that purchase of their 10th automobile! -Kevo
I can't count myself in the "us poor people" -- I'm not all that far below the point where the Obama line would cut me -- but by all means take my taxes back to Clinton rates. Especially if some of that gets used for protection of the people at the other end of the scale, and for education.
It's the right thing to do, it's good for the country, and in particular it's good for my (as yet hypothetical) grandchildren. Besides, it'll have the ex-wife foaming at the mouth.
This is false. Democrats want to raise the taxes on 250,000 and according to the CBO that will decrease employment by 200,000, thus increasing employment by a total of 1.6 million.
Republicans want to keep the tax rates the same for all tax payers and that will increase employment, according to the CBO, by 1.8 million.
How is increasing employment by 1.6 million "more helpful" to the economy than increase employment by 1.8 million?
(Additional note: You can still make the case that the balance approach is the better compromise but based on CBO numbers, leaving the cuts in place for everyone incearse employment the most.)
Because the GOP is worried about the deficit, REMEMBER?
Overall, tax rates are very low by historical standards. A good deal of our ongoing deficit is directly attributable to the Bush cuts. Yes, we can go back to higher rates for all. But what is not practical is simply cutting programs to the bone in order to reduce the deficit.
Mike, I simply was pointing out the statement was incorrect. Still is.
We have got to address the real problem with the deficit which are runaway entitlements.
Which "entitlements" are adding to the deficit and how are they doing so?
I'll wait...
Medicaid is the biggest problem it is not funded out of a trust fund like medicare and social security. It is funded out of the general tax fund and is increasing daily. Medicare is on a curve to be a huge problem due to the increase in medical cost but mostly from the addition of baby boomers. It is running a deficit and it will run an increasingly larger deficit which will cause the lowering of benefits within 4 years. Social security is good for about another 17 years and can be fixed by a couple of changes in either the age benefits begin or extending the base beyond a hundred and twenty grand.
I heard Boehner this morning saying he wants the President to do the same thing Romney/Ryan proposed. Did'nt he get the message the voters sent Washington? The majority of the American people said they did not want the Romney/Ryan budget. Forget about the next election Mr.Boehner and do what the American told you what they want you to do.Forget about the 2% (one percent tea party and one percent wealthy) and just get it done.
It makes absolutely no sense that if you increase the tax liability on the wealthy you will decrease employment. The wealthy have there money off shore in Swiss Bands or the Cayman's and they are paying no tax on that money, so how is money sitting in an off shore account creating jobs in the US?
Secondly, all elected officials are our employees, essentially we hired them and therefore we can fire them. So why don't we start a petition stating that taxes will be raised on the wealthy now and we work on reducing the deficit and when job formation increases it a certain level, say an empllooyment level of 4% , then we can ease up the tax rates to more quickly reduce our debt. This is something that is totally doable, but it looks like we are the ones that need to get the job done.
What amazes me is how the far right and FOX actually believe their own propaganda, even when the majority of the country has demonstrated through this election their complete rejection of republican ideology on taxes for the job 'profiteers', smaller government(which in GOP think only means no regulations on corporations), marriage etc.
It's not demographics either as no matter what color or race the president is it's the ideology of the democratic party which won out. They would have voted for the dem irregardless of race. Everything FOX noise, right wing talk radio and GOP leaders said the American people wanted was wrong, is wrong and will be wrong. Everything the promoted has been tried tested and failed. When will they stop pushing the ideology of the wealthy few and wake up to the real America...Democratic Socialism...a 'we' society... where both our freedom and our survival is ensured.
Time the GOP started listening instead of demanding. Taxes on the 1% for most of our history has been between 70 and 91% and the nation flourished. Now they complain about a 3% increase and pay 36-39%??? That is just pathetic.
Yeah... 70-90% of income... great incentive to want to get out there and work one's butt off... or do you assume that they didn't work hard to get where they are?
I assume that human nature hasn't changed that much from when I was a kid and the top rate was 91%, yet somehow we managed the greatest improvement in median standard of living that the country has ever had.
Yeah. That's after the first 1-2 million. The corporate owners put their money back into their companies rather than pay that much tax so businesses grew...now they just take that extra money and buy politicians or gamble on Wall Street. How rich do you need to be Lisafp?
That depends on the cost of politicians.
with regard to the Bush tax cuts, why has no one discussed the federal estate tax as a sound means of raising revenues in addition to, possibly, a less aggressive tax increase on those earning $250,000+. It seems less painful to go back to a more meaningful tax rate on estates exceeding $1,000,000 than to impose income taxes which even those in the $250K bracket may not be able to tolerate. If the estate tax were to be reinstated and an income tax imposed on those earning $1,000,000+ the government should find itself in extremely good financial shape and the deficit being cut, thereby permitting programs for education, etc. being put into action. I believe this concept would encourage many Republicans to join in the President's picture for this country...improve the economy and create opportunities for our citizenry.
i think we should go back to what the tax rates were before President Bush took office and started two wars. Someone yesterday said let the country go over the cliff. He said that then President Obama could do his own tax cuts. Most of the wealthy like Warren Buffett says it won't bother him if we raise his taxes. He didn't like it that his secretary pays a higher tax rate than he does. He has more left over after he pays his taxes than his secretary does.
Compromise Idea for Tax Cut/No Tax Cut Impasse & Rewarding Real Job Creators:
1. Extend the Bush tax cuts now on all income under $250k/yr. This immediately gives a great amount of economic certainty to 98%+ of Americans and to the markets. As the economy improves, this issue can always be revisited to determine if taxes should go up, down or remain the same in this income category.
2. No blanket extension of the Bush tax cuts on income over $250k/yr. Instead...
3. Reward true job creators in $250k+/yr income bracket in this way: For each good paying proven (to the IRS) job created, attach a corresponding tax cut. This would truly separate the "job creators" from the "non-job creators" in this income bracket. (We all know that there are many people in this income bracket who have never created a job...and never intend to.)
Are you aware that what you suggest is ALREADY the law? Please learn what the laws actually are before making proposals. Business that hire someone who has been unemployed for over 90 days currently get at $4500 tax CREDIT. now any more ideas as yours is in place and not working.
Say what? Look folks, any FOX-respecting idiot knows that taxing the wealthy leads to fewer jobs which then leads Obama to more socialism and turns us into a welfare state! Quit listening to these professionals. As Rush could tell you, the real professionals do not work under a ni..uh democrat! If you keep listening to reason then you may as well quit the NRA, stop bombing abortion clinics,quit vigilante border patrols and heck fire toss the white hoods in the fire instead of Science books!
My question is how much is a "fair share"?
If the...
top 1% pay 37% of all taxes
top 5% pay 58.7%
top 10% pay 70.5%
top 25% pay 87.3%
top 50% pay 97.7%
bottom 50% pay 2.3%
bottom 47% pay no taxes
Also the average tax rates are:
for top 1% - 24%
for top 10% - 18%
for top 50% - 12.5%
for the bottom 50% - 1.85%
(IRS stats 2009)
I keep hearing that things need to be fair and balanced. Based on what set of standards?
Why is it that both parties were able to agree on cuts, but things stalled because revenue could not be agreed upon? Isn't that holding the movement towards fiscal restraint hostage?
Nice twist on facts there. If you hold over 90% of the wealth and yet only pay @ 38% of tax collected then that is far from fair. If your corporation makes billions in profit but pays less than 5% of that in taxes while spending more on political ads is that fair?
How about 0% on all income below thirty thousand dollars and 18% on all income above that-across the board with no deductions? Those who are working for less than 30,000 would benefit the same as those who make more since everyone will get the first thirty grand tax free.
The more you benefit from a free society the more you owe to that society.
Businesses are far more of a burden to infrastructure than individuals also.
I make less than $40k a year and pay plenty of taxes, my dear.
Payroll taxes, property taxes, sales taxes, taxes on gas, even the damn Turnpike fee is really a <bleep> tax.
To insist that I don't pay my fair share, which percentage wise is MORE than what a top 10% pays (in reality) is disingenuous at best. Insulting, entirely.
only one of the taxes you mention are relevant to the federal government which is where the argument lies. Only federal income tax or the lack of it impacts the deficit.
Maybe I'm slow or something but why is losing 200,000 jobs something to be desired? If there were 200,000 jobs added in one month that would be a huge headline, it would be a huge number in this climate. But to belittle that kind of increase is concerning, it is not logical. It seems that people just have a hatred towards the high income bracket and want to make taxes fairer. Go look at IRS statistics and the top 50% pay around 98% of taxes, while the top 1% pay 38% of taxes. Please don't let your blind ideology get in the way of these 200,000 jobs. We should be fighting for all we can at this point in our economy.
Instead of blaming others who have achieved a level of success (which has always been the "American dream"), why aren't we looking at the failure of our congress to exercise fiscal restraint?
and... I agree, 200,000 jobs are important... to 200,000 citizens and their families. Don't minimize that.
If all we cared about was increasing employment in a down economy, we wouldn't be worrying about the deficit. But that approach won't wash with the Republicans.
So now that we're worrying about the deficit, the question is how to cut it with the minimum loss of jobs.
HTH. HAND.
D.C.....we would also not be worried about taxing the rich....just for spite. We need to stimulate the economy without increasing debt....lowering the tax rate for small business and removing loop holes that allows companies like GE from paying any taxes when they have billions in profit would accomplish that.....
Increasing taxes on the rich isn't "spite".
Forcing the rich to actually earn their income, now that would be spite!
So you I guess you are saying that the rich didn't earn their income...and maybe you are correct...but without them....who would provide our jobs???? Government???
That scenario sounds familiar.....
maybe we should all quit working and become instantly rich. When I had my business I worked a minimum of 60 hours a week . I made good money but it was alway at risk. If doug thinks it is so easy he must be a multi billionaire.
Hey TC...good point as usual. Hope your doing well my friend.
TAP
So the GOP wishs to ignore the CBO and other studies and rely on a single "independent" study stating that increasing taxes on the top 5% will crush the economy. My question is who did this "independent" study and was it a partisan group?
Gregori....from what I have read here....Taxing the rich is going to cost 200,000 American Jobs.....why does anyone want to do this? Have we so much hatred toward the rich that we are willing to sacrifice 200,000 jobs and the revenue from those jobs just to make those nasty greedy rich folks pay more?
Greg, that 'Independent' study probably came from Fake news. The teaggers are famous for rejecting reality and subsituting it with their own.
John...actually I was quoting the Maddow Blog....the title is comparing GOP vs Dem...but my point is this....if the dem plan is better great...but why do anything that will do "harm" to our economy and increasing taxes on the rich will do the least "harm" but it is still harm.....this is all in reference to the following article....
Just yesterday, as talks over taxes and spending grew a little louder in Washington, House Speaker John Boehner (R-Ohio) cited an "independent" report that found tax increases on the wealthy would "cost our economy more than 700,000 jobs."
The argument, not surprisingly, was debunked months ago. But the rhetoric raises a worthwhile question: what would happen if a bipartisan agreement fails to materialize, and tax increases automatically kick in on Jan. 1?
Yesterday, the non-partisan Congressional Budget Office reported the looming tax hikes and spending cuts would undermine the economy in 2013, but the "least harmful component of the coming fiscal consolidation is precisely what Democrats are demanding: the expiration of the Bush tax cuts for high earners."
So, according to the CBO, the Democratic priorities do more to help the economy, and the Republican priorities do less. The 700,000 figure cited by the House Speaker has no basis in reality at all.
Maybe Republicans will try to suppress this, too?
No, you were agreeing with Bonehead.
I didn't agree with you.
Should let the tax rate for those above $250,000 reset to the original level; or - raise it above that! But to call the expiration of a tax cut - a tax increase - is a ridiculous word game.
When those folks go buy a product the day after a sale, do they insist on the sale price? .... oh, guess those folks (above $250,000) are probably not too worried about sale prices. While the middle class are trying to double coupon days to save $$ on breakfast cereal.
What has the tax cut for above $250,000 generated? Has it produced jobs? improved the economy? What's the evidence of that? Oh - that's right there isn't any. In fact, the studies indicate that it has done nothing.
The unemployment rate is close to 8% so it has created jobs for 92% of the population.
I think the way this post presents the report is a little confusing, because it just looks at employment numbers, rather than the GDP. If you read the report, the CBO estimates go on to look at those jobs numbers in relation to their budgetary cost. So yes, 1.8 million jobs automatically looks better than 1.6 million, but when you take into account the reduction in revenues due to extending tax cuts for the top brackets, you end up with a $0.50 increase in GDP per dollar of budgetary cost. Letting the top bracket cuts expire, you get slightly fewer jobs in the short-term, but you get $0.60 increase in GDP per dollar of budgetary cost (more economic bang for your buck, so to speak). Also, when the effect on employment is measured in full-time-equivalent employment years per million dollars of budgetary cost, you get the same result whether you let the top tax cuts expire or not (3 FTE employment years/$million). So, the immediate effect on employment would seem to suggest that extending all the tax cuts is better, but the effect on the economy as a whole is better letting the cuts for income above $250k expire. At least, I'm pretty sure that's what I read in that labyrinthine report. :)
(The most relevant paragraphs are on p.11-12 of the CBO report linked to in the post.)
You did not read it correctly. tax removes money from the private sector. In no way is it mathematically possible to remove money from the private sector and have it increase the private sector. GDP is all the output of the u s private sector. Reducing it can't increase it.
Thoughtful...I think you might be confusing GDP and GNP. GDP includes government expenditures. The assumption is actually that since the government is more likely to spend extra revenue immediately, whereas private citizens are more likely to save at least some of it, increasing the government's ability to spend actually has a larger effect on GDP than cutting taxes.
http://en.wikipedia.org/wiki/Gross_domestic_product#Components_of_GDP_by_expenditure
sorry but you are wrong here from Websters
check out your post and understand the Savings equal investment. Growth can only come from investment and investment cannot be made without savings. Government spending only helps a given target for example military spending which does nothing for a part of the country that has no military installations or manufactures. It is used to pick winners and losers at the whim of a politician or bureaucrat. money in private hands always goes to industries picked by people.