cutting taxes

[j_b]

http://www.cbpp.org/4-14-04tax-sum.htm

 

The Bush tax cuts have contributed to revenues dropping in 2004 to the lowest level as a share of the economy since 1950, and have been a major contributor to the dramatic shift from large projected budget surpluses to projected deficits as far as the eye can see.

 

The tax cuts have conferred the most benefits, by far, on the highest-income households — those least in need of additional resources — at a time when income already is exceptionally concentrated at the top of the income spectrum.

 

The design of these tax cuts was ill-conceived, resulting in significantly less economic stimulus than could have been accomplished for the same budgetary cost. In part because the tax cuts were not as effective as alternative measures would have been, job creation during this recovery has been notably worse than in any other recovery since the end of World War II.

[assmonkey]

SEATTLE, United States (AFP) - There is no doubt that sales are hot for handbags bearing an insult -- in French -- aimed at "our president." The question is: Which president?

 

The bag's designer Tom Bihn never guessed that purses with the message, "We're sorry our president is an idiot. We didn't vote for him" -- inscribed in French -- would be blowing out of the stores.

 

 

"It is a mystery, but since we launched the bags with the label sewn, sales have doubled," said Bihn, 43. "It is a record in the history of the company."

 

 

He denies the message is targeting US President George W. Bush (news - web sites).

 

 

"It depends on either your nationality, or the president you think is an idiot; you choose."

 

 

Clients throughout the United States have flooded his offices in Seattle and Port Angeles with calls and e-mails to order for the bags, he said.

 

 

The company received "varied reactions" including "hate mail from a French citizen who thought the label was addressed to (French President) Jacques Chirac."

 

 

But 80 percent of the Americans think it is an amusing message, he said.

 

 

On his company's website, he said: "Everyone seems to have a 'president' that they think is an idiot. Take your pick: Jacques Chirac, Bill Clinton (news - web sites), George Bush."

 

 

Neither Bihn nor his 10 employees have yet taken the situation seriously, but have launched a series of T-shirts, selling at 20 dollars each, with the same message, with funds to go to a war veterans' center in Seattle.

 

Yahoo! news link.

[catbirdseat]

If you give a rich guy a tax cut what does he do with the money? He goes on vacation in France, or maybe he buys a new BMW, or maybe he just invests it in European currency or in European stocks. Anyway you look at it, the money doesn't do anything to stimulate the American economy.

 

When a middle class guy gets a refund check he pays down his credit cards, replaces his broken down Chevy or takes his wife out to dinner at the local restaurant. Tax cuts to those of modest means do much more to stimulate the economy. Because most of the money went to the rich, we have the largest trade imbalance in our history. The money is largely going overseas.

[Fairweather]

Facts to support this? Parhaps a study from a non political source?

 

 

...a rich guy and a BMW? How cliche'. What about the middle class guy who bought the Subaru? ...Or the low income lady who bought Malasian made clothes for her kids at WalMart?

 

I see absolutely nothing compelling in your post above.

[lummox]

he fixes his broke ford. aint you ever heard the line 'built ford tough with chevy parts.'

[Dru]

how come there is no smith climb caled ford tuff?

[JoshK]

Facts to support this? Parhaps a study from a non political source?

 

 

...a rich guy and a BMW? How cliche'. What about the middle class guy who bought the Subaru? ...Or the low income lady who bought Malasian made clothes for her kids at WalMart?

 

I see absolutely nothing compelling in your post above.

 

Well, besides the fact that most all subarus are built in north america now...

 

What he's alluding is that the richer you are, the larger % of your income goes to luxury good spending. The rich paying more taxes stimulates the economy and not only benifits the lower and middle class but then as well. For supposedly being smart people I'm surprised they are too dumb to get it. It's really in their best interest.

 

How many rich people do you think are better off now than in the clinton economy despite lower tax burden? I bet there are 3 or 4...

[Off_White]

how come there is no smith climb caled ford tuff?

 

What, don't you have your new Smith guide yet? It's in there.

[Peter_Puget]

What he's alluding is that the richer you are, the larger % of your income goes to luxury good spending. The rich paying more taxes stimulates the economy and not only benifits the lower and middle class but then as well. For supposedly being smart people I'm surprised they are too dumb to get it. It's really in their best interest.

 

Please explain!

[Fairweather]

Facts to support this? Parhaps a study from a non political source?

 

 

...a rich guy and a BMW? How cliche'. What about the middle class guy who bought the Subaru? ...Or the low income lady who bought Malasian made clothes for her kids at WalMart?

 

I see absolutely nothing compelling in your post above.

 

Well, besides the fact that most all subarus are built in north america now...

 

What he's alluding is that the richer you are, the larger % of your income goes to luxury good spending. The rich paying more taxes stimulates the economy and not only benifits the lower and middle class but then as well. For supposedly being smart people I'm surprised they are too dumb to get it. It's really in their best interest.

 

How many rich people do you think are better off now than in the clinton economy despite lower tax burden? I bet there are 3 or 4...

 

Hondas; yes. Toyotas; yes. Subarus; no. Still built in Japan I believe.

 

Still waiting for Catbird (The Scientist), and now you, to back up your assertion.

[Peter_Puget]

Come on Josh ...I am waiting...

 

Phased-In Tax Cuts and Economic Activity

Christopher L. House and Matthew D. Shapiro

NBER Working Paper No. 10415 (April 2004)

 

 

Phased-in tax reductions are a common feature of tax legislation. This paper uses a dynamic general equilibrium model to quantify the effects of delaying tax cuts. According to the analysis of the model, the phased-in tax cuts of the 2001 tax law substantially reduced employment, output, and investment during the phase-in period. In contrast, the immediate tax cuts of the 2003 tax law provided significant incentives for immediate production and investment. The paper argues that the rules and accounting procedures used by Congress for formulating tax policy have a significant impact in shaping the details of tax policy and led to the phase-ins, sunsets, and temporary tax changes in both the 2001 and 2003 tax laws.

 

I would think irrational exuberance, 9-11, and extraordinary increases in productivity might be important factors too! Oh wait I forgot this is just political sloganeering....

 

PP

[JoshK]

Yes, because as we all know saddling the country with huge deficits is a strong engine for economic recovery.

[catbirdseat]

"President Bush concedes the rich get more under his plan, but claims that his proposed $1.6 trillion tax cut is a win-win for every family: Everyone gets cash back and the cut will stimulate the economy. This administration will leave no billionaire behind.

 

Let’s take the W. Bush-Greenspan claim that tax cuts will goose the slowing economy by giving folks money to spend. The father of modern economics, John Maynard Keynes, and modern economists that followed show that if you need spending the rich are the worst people to target; they hoard cash and spend it on foreign goods. A tax cut to wealthy Americans might help the French wine industry, Swiss tourism and the German car companies. But it won't do much for Muncie. All in all, economists don’t buy the stimulus claim.

 

The tax cut is no win-win; it’s win-lose. Someone pays. Bush’s budget bill spends $16 billion less on the environment, research and, surprise, the military. The tax cut raises the price for things we want now and may want later — bombs and freeways. And, it will make soaring inequality worse. A top-heavy tax cut perverts market incentives, though capitalism’s charm is supposed to be rewarding effort and ability. Congressional Democrats complain that the tax cut rewards those who the 1990s treated the best and not those who worked the hardest. "

Article

 

Some more reading.