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i think this is an issue with your english competency, rabbi. to wit:the issue in the logic behind your 'sapping resources the private sector could be using actually to produce something' is that the US tax system coerces investment by exempting it from tax. if the private sector is really out to invest, then they will. if they aren't, i argue that they will be hoarding that cash, which does not serve the purpose of printing it up in the first place. this is why the government has a complicated system through which to tax specific economic activity like hoarding among businesses and higher-earners.
if you are going to levy tax, and it is a necessary evil, then it should be targeted in the interest of the economy. i argue that it is and your logic does not survive that fact.
Your post is a confused muddle of half truths and misconceptions.
do you know what coercion means?The tax system does not "coerce" anything except payments from people. It does serve to encourage and discourage certain behaviors.
lets move on. i'm not as into the ad hominems as you are.
keynes hasn't posited that demand 'grows' an economy, but he did point out that potential demand is the object of investment, and that lapses in this potential demand, which keynes specified in cash in hand and employment and monetarists summarize as the money supply, are the basis of weak investment.The private sector will invest where it perceives a possibility of return commensurate with risk. Taxes negatively affect return. So some investments that would be viable at a lower tax rate will not be viable at a higher one. Investment is what grows the economy (NOT consumer spending, as the Keynesian Obarrahoids believe). So taxes on it are depressing to economic activity.
from a microeconomic perspective, investment without perceiving a return, presumably through consumption of the produce from this investment is bad investment. this is how demand is important in an economy.
commerce is the epicenter of growth in an economy. it is the point where profit is realized. it is the intersection of supply (part of which is investment) and demand.