MemePolice

[jbartas]

Stimulate the Economy with "Cattle Prod Economics".

Starting in the 1980s I began to hear the argument that tax cuts can "stimulate the economy". The idea was that if you left more money in the hands of individuals or businesses, they would spend it in such a way that it would cause more economic growth than if the government spent it. In other words if I buy a pencil, that's somehow better than if the government buys a pencil. No one's ever explained to me how the identity of the spender makes the spending more "stimulating", or for that matter what happens if people save their tax rebates (like I do) instead of spending them. (Is that legal?)

The truth is that economics is at best a sloppy science, so only one thing is sure from a Republican tax cut - billions will go to to the wealthiest moneyholders, usually the same businesses and investors who funded the Republicans. What a coincidence!

Historically there is no evidence that tax cuts help anything but rich people getting richer. See the graph under "small government" and see if you can spot the tax cuts.

Long term that sort of stimulation does more harm than good. It widens the gap between the haves and have nots, and undermines the middle class - the very backbone of American society.

Doctors once tried to cure psychological depression with electrical shocks. It didn't work; it just hurt people. Causing random jolts to the economy and pretending it might help is just as cruel. No doctor would use a Cattle prod on a patient (except maybe Bill Frist), but that's what the tax-cut whackos keep doing to the economy. It may fit with Cheney's pro-torture philosophy, but it's dishonest, self serving and bad financial policy.

Cattle Prod Economics - the truth is shocking!

[KimCooper]

There is a website wherein a guy who understands these things (economics and how it works) explains it all in ways the are pretty understandable. So, if you want to understand how it REALLY works, I suggest you check it out:

http://taxwisdom.org/

ADMINS NOTE: Kim, the web page seems to have moved. I think this is the same article:
http://nontrivialpursuits.org/collectivist_schemes.htm

The author, James Kroeger, makes a lot of sense. His conclusions are non-traditional, but I had year of Economics in College and I can't fault his reasoning. He may be the next Adam Smith. I wish He'd learn a bit more HTML though

[tcanfield]

It was Bush Senior who called Reagan's tax cuts "Voodoo Economics", and now Bush Junior is the Voodoo Master. Right now I am living through the nightmare of the Bush tax policy. My employer has decided that because of the tax cuts, it is time to take the money to run. So, he is selling off all of his real estate holdings in Maine, and will retire to Florida with a Swedish wife who is 20-years younger. He is selling the business I work for, but he is asking such a high price that the new owner will not be able to afford to keep me on. So, thanks to the Bush tax cuts, my ex-boss will be living high on the hog, and I will have to scrape by with unemployment checks. I just hope I won't need food stamps, since that service is being cut as well.

[KimCooper]

tcanfield: and you didn't try to sabotage the sale?

[tcanfield]

What would be the point of trying to sabotage the sale? The only person who would be hurt is the business manager, who has been wanting to buy the business for years. If the sale were sabotaged, the business would probably be sold to someone else, and we both would be out of a job.
I have nothing but sympathy for my manager at this point because she is going to be taking on a mountain of debt and she will have to do all of the work herself. I am hoping to find another job, which I may or may not stay with. She, however, is going to be chained to this job for years to come, and it may be very painful.

[KimCooper]

I just noticed your use of the term "Voodoo Master" for Bush. I like it.

Voodoo Master Bush

[jbartas]

I just noticed that James Kroeger has an article up that directly relates to this meme:

Do Tax Cuts Stimulate the Economy?

...It seems they don't.

See also Tax Cut Zombies - A link to a great Paul Krugman article.