Tax cuts. Do they work?

Trump.Stamped

Gold Member
Mar 11, 2016
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From the right you hear tax cuts increase jobs, investments, spending, etc which makes up for the lower rate.

From the left you just hear it cuts taxes for the rich and increases the deficit.

Frankly, I don't give a shit one way or the other. We don't have a problem with tax rates being too low, we have a spending problem. I feel I can spend MY MONEY better than the fucksticks in Washington DC.

You can research and find different answers, and not many definitive answers. In the Washington Post article below they say the following:

First of all, revenues as a percentage of gross domestic product (GDP), which is the best way to compare across years, dropped from 19.1 percent in 1981 to a low of 16.9 percent in 1984, before rebounding slightly to 17.8 percent in 1989. One reason the deficit soared during Reagan’s term is because spending went up as a share of the economy and revenues went down.

But we can get even more specific about the impact of the 1981 cut in rates. A Treasury Department study on the impact of tax bills since 1940,
first released in 2006 and later updated, found that the 1981 tax cut reduced revenues by $208 billion in its first four years. (These figures are rendered in constant 2012 dollars.) The tax reform act of 1986, which was designed to be revenue neutral, reduced revenues by less than $1 billion four years after enactment.

But Reagan’s tax increases in 1982, 1983, 1984 and 1987 boosted revenue by $137 billion. Overall, that’s a revenue loss from Reagan’s various tax bills, but it also shows that Moore is crediting to Reagan’s tax cuts revenues generated by Reagan’s tax increases.


So, in summary, if my taxes are lower and we initially lose a few hundred billion in revenue a year, so be it. Cut the ridiculous spending to make up for it.

Rand Paul’s claim that Reagan’s tax cuts produced ‘more revenue’ and ‘tens of millions of jobs’

FACT CHECK: Do Tax Cuts Grow The Economy?
 
IMHO, there are times when a tax cut is a good idea, when the economy needs a fiscal and psychological boost. And there are also times when a tax hike is needed to cool an overheated economy and fight a rising inflation. I thought the tax cuts under Clinton back in the late 90s wasn't such a good idea cuz the economy then was already doing well and there was no real need. But the Bush tax cuts in 2003 were a good thing cuz the economy and the country needed a boost to put 9/11 behind them and focus attention back to jobs and growth. And it worked too, from 2003-2007 the US economy did very well, due in part to those tax cuts. And spare me the BS that those tax cuts had anything to do with the recession, that is utter nonsense. I also thought Obama should have extended the Bush tax cuts on the rich instead of letting them expire; it wasn't a good idea, but given his anathema to business maybe it wouldn't have mattered.

Some people say we should tax the rich more and give tax cuts to the poor and middle class, but I don't think history bears that out. It'll help a little but I don't think you get nearly the benefit that some say; a lot of that money goes into the bank for a rainy day rather than spending, and besides we already have almost 50% who aren't paying taxes so how do you cut their taxes if they ain't paying anything? And I am unaware of any examples where such a tax policy got an economy out of the doldrums and back to prosperity.

There are other factors besides tax rate changes that influence economic growth, such as the burden of regulatory compliance and our trade policy. Protectionist polices are always a bad idea IMHO, you may save some jobs but lose others that might have been created. People bitch about losing jobs overseas but in this era of automation those high-paying union jobs were already dying out.
 
From the right you hear tax cuts increase jobs, investments, spending, etc which makes up for the lower rate.

From the left you just hear it cuts taxes for the rich and increases the deficit.

Frankly, I don't give a shit one way or the other. We don't have a problem with tax rates being too low, we have a spending problem. I feel I can spend MY MONEY better than the fucksticks in Washington DC.

You can research and find different answers, and not many definitive answers. In the Washington Post article below they say the following:

First of all, revenues as a percentage of gross domestic product (GDP), which is the best way to compare across years, dropped from 19.1 percent in 1981 to a low of 16.9 percent in 1984, before rebounding slightly to 17.8 percent in 1989. One reason the deficit soared during Reagan’s term is because spending went up as a share of the economy and revenues went down.

But we can get even more specific about the impact of the 1981 cut in rates. A Treasury Department study on the impact of tax bills since 1940,
first released in 2006 and later updated, found that the 1981 tax cut reduced revenues by $208 billion in its first four years. (These figures are rendered in constant 2012 dollars.) The tax reform act of 1986, which was designed to be revenue neutral, reduced revenues by less than $1 billion four years after enactment.

But Reagan’s tax increases in 1982, 1983, 1984 and 1987 boosted revenue by $137 billion. Overall, that’s a revenue loss from Reagan’s various tax bills, but it also shows that Moore is crediting to Reagan’s tax cuts revenues generated by Reagan’s tax increases.


So, in summary, if my taxes are lower and we initially lose a few hundred billion in revenue a year, so be it. Cut the ridiculous spending to make up for it.

Rand Paul’s claim that Reagan’s tax cuts produced ‘more revenue’ and ‘tens of millions of jobs’

FACT CHECK: Do Tax Cuts Grow The Economy?
Now you know why Democrats get upset when anyone mentions spending cuts when they're in power, and are critical about any tax cuts. It's always "TAX CUTS FOR THE RICH!!!!" Forget the fact that they voted for the Bush tax cuts every time.

The number one reason we should repeal Obamacare is that it is the biggest tax increase in US history. Simply repealing it without replacing it would would be a massive tax cut to the middle-class. This is why Paul Ryan screwed the pooch when it was first introduced. He is a Washington politician after all. Repealing Obamacare alone does not solve our job creation problems however. The corporate tax has to be cut to be on level with the rest of the world or it will make little difference.
 
From the right you hear tax cuts increase jobs, investments, spending, etc which makes up for the lower rate.

From the left you just hear it cuts taxes for the rich and increases the deficit.

Frankly, I don't give a shit one way or the other. We don't have a problem with tax rates being too low, we have a spending problem. I feel I can spend MY MONEY better than the fucksticks in Washington DC.

You can research and find different answers, and not many definitive answers. In the Washington Post article below they say the following:

First of all, revenues as a percentage of gross domestic product (GDP), which is the best way to compare across years, dropped from 19.1 percent in 1981 to a low of 16.9 percent in 1984, before rebounding slightly to 17.8 percent in 1989. One reason the deficit soared during Reagan’s term is because spending went up as a share of the economy and revenues went down.

But we can get even more specific about the impact of the 1981 cut in rates. A Treasury Department study on the impact of tax bills since 1940,
first released in 2006 and later updated, found that the 1981 tax cut reduced revenues by $208 billion in its first four years. (These figures are rendered in constant 2012 dollars.) The tax reform act of 1986, which was designed to be revenue neutral, reduced revenues by less than $1 billion four years after enactment.

But Reagan’s tax increases in 1982, 1983, 1984 and 1987 boosted revenue by $137 billion. Overall, that’s a revenue loss from Reagan’s various tax bills, but it also shows that Moore is crediting to Reagan’s tax cuts revenues generated by Reagan’s tax increases.


So, in summary, if my taxes are lower and we initially lose a few hundred billion in revenue a year, so be it. Cut the ridiculous spending to make up for it.

Rand Paul’s claim that Reagan’s tax cuts produced ‘more revenue’ and ‘tens of millions of jobs’

FACT CHECK: Do Tax Cuts Grow The Economy?
This is why revenue increases never have a positive impact on the deficit. Every new dollar of revenue is met by more than a dollar of new spending.
 
Democrats are big on fighting tax cuts to keep the debt and deficits down, which is true enough but ignores the elephant in the room which is out of control spending. Anybody who is concerned which D&D needs to be focused on spending cuts, and I don't hear the Dems mentioning that.
 
No.
When Bush took office in 1989, the federal budget debt stood at $2.8 trillion, three times larger than it had been in 1980

Reagan got the conservative Christian right behind him.
 

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