“My suggestion is that until that $5 million tax burden on the poor is taken off the table, I am hard pressed to support a tax cut of $7 million on those higher earners“,
John Kowalko, State Representative 24th District
And in 34 words, we see the folly of tax cuts on the wealthy. What good does $80 dollars per $100,000 assessed, do to the economy? But the Medicare cuts, which are simply a percentage of the total costs a person must payout, mean additional charges to individuals that range from $800 to $50,000?
You tell me! Which one affects the local economy more… Creating additional charges which take away money that otherwise would be spent on groceries or necessities, or an unneeded $80 dollars that gets spent towards buying a piece paper: one that declares you the owner of a small piece of a bar of gold, somewhere supposedly stored in a someone-who-you-don’t-know’s vault?
Tax cuts will never, never, never stimulate the economy. The only thing that stimulates the economy is to put more money in the hand of people who buy “things”. Pay people more. If corporate America won’t agree do that, then we need a government who will make them….
Remember the past decade? The fight about unions? This, is why America needs strong unions. Get rid of unions, we become nothing.
When unions were strong, the middle class was strong. When unions became weak, the middle class couldn’t get a word in edgewise.
Delaware is overdue for a non work day, to show corporate America, that Delaware will help them succeed, but only to the point that it doesn’t kill us in the process…..
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June 14, 2011 at 9:36 am
JustMe
The only thing that stimulates the economy is to put more money in the hand of people who buy “things”.
So tax cuts, which lets people who buy “things” keep more of their own money to spend on those “things” will not stimulate the economy.
How else do you get money into those hands? Take it from others? Print more and drop it from a plane?
or an unneeded $80 dollars that gets spent towards buying a piece paper
Unneeded? Who determines “need”? You? The government? What if they determined you didn’t “need” to buy eggs for breakfast but instead you “needed” oat bran?
You sound like you’re making the case against saving and investment over and over. We should just spend every dollar we get. How else to keep the economy going?
June 14, 2011 at 11:23 am
kavips
Aye, there’s the rub…. “So tax cuts, which lets people who buy “things” keep more of their own money to spend on those “things” will not stimulate the economy?.” It can, … but it doesn’t…. History shows it runs an economy into a depression.,,,, Before we had income taxes we constantly had depressions all the time.. But, when the marginal tax rate was higher, we had booming economies; every time we’d return to cut taxes, we’d have a four month boost, then tube the entire economy….
Like it or not, we live in a contained economy. Like astronauts on in the Space Station, if we don’t recycle our water, we die… Taxes and printing money are ways to recycle income.. Taxes are better than simply printing money, because they lead to less inflation.
Perhaps it is better explained that the percentage of money that gets returned directly into the economy, is higher on the low end of income levels than it is on the higher end of income levels. Your scenario would work, if the wealthy decided to buy and maintain yachts with ALL their money… But how many yachts does one need? If you allow the income to matriculate into the hands of fewer and fewer people, as it does in Mexico, South America, Africa, and in the primitive parts of Asia, , you incredulously get less, and less spending.
So, taking the money from rich people and giving it to the poor, simply saying “here’s some money, go spend it” is exactly what is needed and is how to get the economy roaring. If the rich were smart, they’d be reporting 0 net gains and 0 incomes, and drive into the slums, redistributing 100% of what they made themselves, simply to keep the government out of their pockets… But they don’t.
We tried their plan. It has a big flaw that no one saw,: it takes money out of the economy. …. so now it is time to go back to what seemed to work better, from 1940 through 2001, analyze the data, and reformulate how we do things. The easiest, quickest way is to raise the taxes, which, fortunately for us, has been conveniently arranged, so that instead of actually raising taxes, we simply kill those existing tax cuts that caused and keep causing the whole economy to tumble……
As for saving and investment… that case has already been made…. It doesn’t work. ……