R
rdean
Guest
Also, the OP is seemingly against tax increases and yet ignores how over 35% of the Stimulus was in fact tax cuts.
American Recovery and Reinvestment Act of 2009 - Wikipedia, the free encyclopedia
While Keynes was also a Liberal, he is in fact not a hardcore socialist or a socialist at all like some make him out to be. A great line I read that describes him is in Keynes: Return of the Master by Robert Skidelsky was that "he came to critique Capitalism, not bury it."
Never said anything about tax increases, maybe you should watch those assumptions. I do know that about a third of the Obama Stimulus was tax cuts, for the lower and middle classes. Was supposed to stimulate demand and growth, and we were supposed to get unemployment down to below 8%, you remember that? Another example of how Keynesian economics did not work.
FWIW, I think we should increase the $106,800 ceiling on FICA taxable income, and I think the tax code should be scrubbed to eliminate or reduce deductions, loopholes, breaks, and credits that are obsolete, ineffective, or otherwise undesirealbe. Most of these things benefit the wealthy, but in any case revenue would go up.
Other than that, I would continue the Bush tax custs until the economy is on solid footing and unemployment has dropped below 7% or so.
What you wrote makes a great deal of sense, and is supported by historical data:
1. Federal spending went from 2.5 % in 1929 to 9 % in 1936: Washington’s portion of the economy increased by 360 % in just seven years- with no benefit to the economy.
2. Arthur Schlesinger, Jr., liberal New Deal historian wrote in The National Experience, in 1963, “Though the policies of the Hundred Days had ended despair, they had not produce recovery…” He also wrote honestly about the devastating crash of 1937- in the midst of the “second New Deal” and Roosevelt’s second term. “ The collapse in the months after September 1937 was actually more severe than it had been in the first nine months of the depression: national income fell 13 %, payrolls 35 %, durable goods production 50 %, profits 78% .
3. In 1935, the Brookings Institution (left-leaning) delivered a 900-page report on the New Deal and the National Recovery Administration, concluding that “ on the whole it retarded recovery.”
4. "America’s greatest depression fighter was Warren Gamaliel Harding. An Ohio senator when he was elected president in 1920, he followed Woodrow Wilson who got America into World War I, ...Harding inherited the mess, in particular the post-World War I depression – almost as severe, from peak to trough, as the Great Contraction from 1929 to 1933, that FDR inherited and prolonged. Richard K. Vedder and Lowell E. Gallaway, in their book Out of Work (1993), noted that the magnitude of the 1920 depression "exceeded that for the Great Depression of the following decade for several quarters." The estimated gross national product plunged 24% from $91.5 billion in 1920 to $69.6 billion in 1921. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921.
Compared to FDR, Harding had a much better understanding of how an economy works. Harding, wrote historian Robert K. Murray, in The Harding Era (1969), "always decried high taxes, government waste, and excessive governmental interference in the private sector of the economy. In February 1920, shortly after announcing his candidacy, he advocated a cut in government expenditures and stated that government ought to ‘strike the shackles from industry.’ ‘We need vastly more freedom than we do regulation,’ he said. Surprisingly, big business took very little notice of him at the time."
Federal spending was cut from $6.3 billion in 1920 to $5 billion in 1921 and $3.2 billion in 1922. Federal taxes were cut from $6.6 billion in 1920 to $5.5 billion in 1921 and $4 billion in 1922. Harding’s policies started a trend. The low point for federal taxes was reached in 1924. For federal spending, in 1925. The federal government paid off debt, which had been $24.2 billion in 1920, and it continued to decline until 1930."
America’s Greatest Depression*Fighter by Jim Powell
Not-So-Great Depression - Jim Powell - National Review Online
The second crash in 1937 happened because budget hawks swooped in and stopped government support which caused the economy to back slide.
Second, the Bush tax cuts did nothing except create and enormous deficit Republicans further built up with two unpaid for wars and Med Part D. Since both the tax cuts AND Part D were passed through "reconciliation", they can hardly be denied.
Rightwingers talk about "cutting" but haven't a clue about "investing". To them, investing means throwing money into the stock market or giving tax cuts to the rich who will then, because they are so charitable, "create jobs"... Yea, in China. The right needs to stay away from the economy, from science, from education, from foreign policy, from social policy. Everything they touch, they infect with their backward and embarrassing ideology. If only they had some small success to build on. Anything they can point to as an achievement. Creating an enormous deficit is NOT an achievement. Creating another Iran out of Iraq is NOT an achievement. Slandering Democrats is NOT an achievement. Throwing the elderly under the bus is NOT an achievement. Tax cuts for billionaires is NOT an achievement.
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