Our economic mess, the direct result of...

Discussion in 'Economy' started by wihosa, Nov 27, 2008.

  1. wihosa
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    wihosa VIP Member

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    Our 28 year experiment in radical right economic theory is complete, the results are in; Trickle down economics DOES NOT WORK. The Laffer curve is a laugh. Cutting taxes does not result in more tax revenue (who could have guessed?), instead, predictably tax revenue goes down and deficits go up. Only after Bill Clinton raised taxes on the wealthy did we have a reversal in the borrowing binge of the Repubs. Not to worry, W undid that "problem" in spades and now the evidence shows that the last three Repub Admin have borrowed ten times more money that all other Administrations in US history combined.

    Supply side economics is a disproved economic theory. It is demand that creates economic vitality and demand is created by rising wages.

    Transferring wealth upward has nearly destoyed the middle class, the real driver of the economy.

    Trickle-down, Supply side, Neo-Conism all into the ash bin of history.
     
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  2. wihosa
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    wihosa VIP Member

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    What? No answer by the people who bought into this folly?
     
  3. BaronVonBigmeat
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    BaronVonBigmeat Senior Member

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    The main thing proved during the Reagan and then Bush administrations is that cutting taxes while raising spending is just a shell game. It doesn't matter if you get revenue by taxing, borrowing, or inflating--in the end, you're still diverting scarce resources towards government (which grew during those two administrations more than they did during Clinton or Carter's administrations).

    Also demand doesn't drive the economy. You can kick and scream and demand (X) all you want, but that doesn't mean it will be supplied. People demanded dirt cheap radios in the 1920's, but they didn't exist until transistors were researched and invented.
     
  4. Kevin_Kennedy
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    Kevin_Kennedy Defend Liberty

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    If you're going to cut taxes you've got to cut government spending. It's a win win situation, if done correctly.
     
  5. AVG-JOE
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    AVG-JOE American Mutt Staff Member Gold Supporting Member

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    The best thing coming out of the Bush 2 Administration is proof positive that his father was right about Regans trickle down 'Voodoo Economics'.

    If I had everything I wanted except more money and I got a few thousand back in the form of lower taxes the last thing I would want to do with it is build a factory and deal with the red tape, unions, hassles, risk, etc.

    I would sit on my yacht and be happy with 6%.

    If you want me to create jobs, give the money to the middle class so I have to make something that they want in order to separate them from it.

    -Joe
     
  6. Missourian
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    Missourian Gold Member

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    On what are you basing this? People, both rich and middle class did invest. Credit was cheap. The stock market boomed. People were flipping houses. Unemployment at a historic low.

    And a bubble, like the housing bubble, isn't created when everyone is poor.

    Take of your ideological blinders for a second and look around...this crisis wasn't caused by too little, it was caused by too much. People got greedy because it looked like the market and housing prices wold never stop going up.

    I'm no economist, but I don't think it was supply-side economics that caused this crisis, it created the environment where prepetual gains caused greed to take root.

    JMHO, YMMV.
     
  7. AVG-JOE
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    AVG-JOE American Mutt Staff Member Gold Supporting Member

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    I disagree, MO... Trickle down economics is a historic transfer of wealth from the middle class to the rich. Even though times were relatively good, the gap between 'haves' and 'have nots' widened, and few will deny that fact. Supply side economics has also been directly responsible for the cancerous attitudes of greed and 'personal over community' that has permeated our politics. If Obama does nothing but rid us of Trickle-down, voodoo Reganomics, his presidency will be a success, in my opinion.

    -Joe
     
  8. Gord
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    Gord Active Member

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    President Kennedy deeply cut taxes in the early sixties and government revenue continued to grow each year. Ronald Reagan severely cut taxes in the early eighties and government revenues almost doubled by the end of the eighties. The deficit was caused by enormous spending increases, on the military by President Reagan to defeat the USSR, and by the Democrats on social programs (the trade-off Reagan had to make with them even though they initially promised to cut spending). But revenues increased, not decreased. The economy eventually grew out of the deficit in the mid nineties with help from the Republican Contract with America which held back government spending, again reduced taxes, and defeated HillariousCare. President Bush again seriously cut taxes early in his first term and government revenues continued to increase each year (except the first - until the effect of the cuts kicked in), even though Bush inherited a recession from the Clinton administration, and the impact of 9/11 on the economy alone was almost two trillion dollars (and don't forget the stock bubble crash of /00, and the Enron, Tyco, Worldcom, Global Crossing, etc. fiascoes - all included in President Clinton's legacy I might add). Additional spending on the war on terror and increases in entitlement spending (a new drug program had been added, and Katrina) and a general expansion of government account for the deficits of the Bush 43 administration (which had been coming down).

    Tax reductions on a national level increase government revenues through economic stimulation. Only stopping deficit spending stops deficits.
     
  9. BaronVonBigmeat
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    BaronVonBigmeat Senior Member

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    Obama is a puppet of Wall Street, so don't hold your breath waiting.
     
  10. xsited1
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    xsited1 Agent P

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    The data proves you wrong. There are many other factors involved and you're choosing to single out Supply-side economics and blaming it on that. Obviously, you're doing this for political reasons and not fact. It's like saying that a company's profits went down because they lowered the price of some of their high-end products. It's not that simple.

    Here is a Harvard study on Supply-side economics complete with data for 18 large economies. It works. Just read the paper:

    http://escholarship.bc.edu/cgi/viewcontent.cgi?article=1135&context=econ_papers
     

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