BF2S Forums Which would Americans like to see first.

Kmarion wrote:

Also don't forget when these tax cuts were put in place the economy was in shambles after 9/11. Consider where the economy is now and you may begin to understand that despite some bad decisions this administration has made, they appear to have gotten this one right.

All 911 affected was consumer and investor expectations. It didn't affect long term aggregate supply, or our ability to produce, (except for the planes and buildings destroyed etc, but relatively speaking this is a minor change) so it is inevitable that as time passed expectations would return to normal and the economy would recover. Citing this as an example of how discretionary fiscal policy is successful is silly, frivolous, and fallacious.

Turquoise wrote:

Kmarion wrote:

The trade deficit has been reduced for the third straight month while tax cuts remain in place, go figure.
Lower taxes> more consumer spending> more taxes. Make sense? Also don't forget when these tax cuts were put in place the economy was in shambles after 9/11. Consider where the economy is now and you may begin to understand that despite some bad decisions this administration has made, they appear to have gotten this one right. Now if they only had a plan for the border...hmm

I agree with tax cuts, and after seeing how much revenue was generated by the cuts in 2005, it just pissed me off to see us blow the budget with war.  Tax revenue rose to something like 2.15 trillion, but spending went up to like 2.45 trillion.  In other words, we ran up a massive debt that was in the hundreds of billions.

My firm belief is that supply side economics could work, if only the Republicans knew how to do it without getting us into continual warfare.

Supply side economics cannot work because discretionary fiscal policy cannot work. We simply can't control short-term economic fluctuations and in fact it is detrimental to do so. Besides, rasising taxes works better than lowering taxes. Reasons why:

1. Decreasing tax revenues decreases tax revenues.
2. MPS cuts increases in consumer spending that result from increased DI.
3. The rich recieve the majority of tax cuts, and the rich have the highest MPS.
4. Increasing taxes directly increases tax revenues.

Finally, reducing spending and spending as intelligently as the private sector works even better. Reducing spending directly is a no brainer, and does not require meddling with tax laws. Government spending is appropriated each year and easily changed. The drawback is a reduction in aggergate demand like that of a tax increase. Which is why intelligent spending is more attractive. The reason people dislike taxes is because the private sector believes it can spend money more intelligently than the government. Because each individual knows their wants better than the government they feel their spending will contribute more to production and general welfare. Generally they are correct, but governments are capable of spending more intelligently than the private sector because they can spend in a much greater scale. The hoover dam is one example. Government spending on domestic infrastructure can be more intelligent than private sector spending because it can simultaneously increase aggregate demand, create jobs, and provide public services the private sector is not capable of providing effeciently on its own. This boost in the domestic economy provides the same theoretical increase in tax revenues as supply side tax cuts without decreasing tax revenues in the process.

Last edited by jonsimon (2007-01-10 18:37:36)

Kmarion wrote:

jonsimon wrote:

Kmarion wrote:

Also don't forget when these tax cuts were put in place the economy was in shambles after 9/11. Consider where the economy is now and you may begin to understand that despite some bad decisions this administration has made, they appear to have gotten this one right.

All 911 affected was consumer and investor expectations. It didn't affect long term aggregate supply, or our ability to produce, (except for the planes and buildings destroyed etc, but relatively speaking this is a minor change) so it is inevitable that as time passed expectations would return to normal and the economy would recover. Citing this as an example of how discretionary fiscal policy is successful is silly, frivolous, and fallacious.

Clearly you have no idea on how the stock market effects the economy. I suggest you investigate the interweavings of it as well as the effects tax cuts have on consumer confidence.

911 only affected expectations. The stock market does not affect LRAS directly. Clearly you haven't taken macro econ anytime recently. 911 didn't destroy our potential to produce, we could still produce as much as before, but because our expectations changed we essentially chose to produce less. As such one can assume that expectations would eventually return to normal and production would recover. If you can't understand that, don't result to insulting me, just stop talking.

jonsimon wrote:

. Maybe you should make sure you comprehend what I am saying in my posts, it seems like you are misinterpreting me.

Edit: As an aside, why in the world are you bringing minimum wage into this and raising taxes? The passage you quoted had nothing to do with either.

Could be, this is why I ask questions and we have dialog. We just subscribe to different theories. I think the impact is much greater than you do. We have the results to prove it as well.

I was adding to the discussion. I'm sure you are aware of the Democrats current agenda include both raising taxes and minimum wage. My first post was referring to tax cut's. I should not have worded it "Can you not see" admittedly.

jonsimon wrote:

Finally, reducing spending and spending as intelligently as the private sector works even better. Reducing spending directly is a no brainer, and does not require meddling with tax laws. Government spending is appropriated each year and easily changed. The drawback is a reduction in aggergate demand like that of a tax increase. Which is why intelligent spending is more attractive. The reason people dislike taxes is because the private sector believes it can spend money more intelligently than the government. Because each individual knows their wants better than the government they feel their spending will contribute more to production and general welfare. Generally they are correct, but governments are capable of spending more intelligently than the private sector because they can spend in a much greater scale. The hoover dam is one example. Government spending on domestic infrastructure can be more intelligent than private sector spending because it can simultaneously increase aggregate demand, create jobs, and provide public services the private sector is not capable of providing effeciently on its own. This boost in the domestic economy provides the same theoretical increase in tax revenues as supply side tax cuts without decreasing tax revenues in the process.

I understand the benefits of the public works projects of the FDR era, and it's part of why I consider him to be the best president we've ever had.

However, I would argue things have changed so dramatically since then that the public works angle is rarely applicable anymore.  It would seem that the government has grown too large and corrupt to trust it with these huge projects.

I'd rather just spend less, pay down the debt, and then cut taxes more.  Minimize government....

I would like a Beer First.. The wall put up.. a better budget and .. then ill have another beer after that.

im not.. im cool with them... they dont want to comeover here anyway...