Lord High Executioner
Join Date: Jan 2009
Location: The Killing Fields
Re: Romney says Obama won by showering black, Latino & young voters with big gifts.
Originally Posted by joe
An explanation for what I said requires theory to understand. There is evidence to back it up, but evidence can be very misleading. That's something I've learned 1,000 times over on this site alone. I see the Great Depression as evidence of central banking failure, government stimulus failure, and I see the wonderful year we had in 1946 (when government finally cut spending) as great evidence that the government needs to cut spending today.
But do other people see that? No. If they're predisposed to economic beliefs like yours, they see the exact opposite. The Great Depression is evidence that the free market inevitably causes economic chaos, and that government stimulus of all kinds is good for the economy. What the hell is up with that? Two entirely opposite conclusions drawn from the same evidence.
So how can you know which of these two viewpoints is correct? You need theory. You need a solid theory first, and then you re-examine the facts through the prism of your theory. Your theory is your flashlight in the dark hallways of "evidence."
I'll give you what I consider good evidence for why lower taxes is good for the economy. America in the 19th century. America became an economic superpower in the 19th century, with zero income taxes for most of the century (some income taxes were levied to fund war, but much less than today and not for as long a period). The 19th century saw tremendous rises in living standards for Americans, as we transformed our economy from agricultural to industrial. It was this century that saw the invention of the Steamboat, the price of steel drop tremendously, Railroads enabled country-wide travel, the invention of the sewing machine, and the telegraph. Gas stoves become more common than ever.
What spurred on these inventions was the low amount of regulations and taxes, which enabled entrepreneurs to easily start new businesses. This created the first batch of "retail workers" in America. Instead of farming, you could work the payment booth for the Railroad. You could get a job as a clerk for a local grocery store. This new division of workers is what created the American middle class. Instead of either being born into royalty or being a sustenance farmer, there was something inbetween. And instead of being born a farmer and dying a farmer, there were chances for promotion. If you worked hard, you could become a manager. You could earn a pay raise.
We take these things for granted today, but prior to the 18th-19th century, that simply was not how the world worked. 99% of the people were born poor, they worked their asses off just to survive, and then they died.
Now clearly, 19th century Americans lived much less luxuriously than we do today. They worked in sometimes dangerous conditions, with low pay compared to today's standards. But compared to prior centuries, the truly relevant measure, life had never been better. People moved to the cities, industry boomed, and immigrants flooded our borders in droves- searching for economic freedom that they could only find in the US. Unlike the rest of the world, anyone could become rich here. The governments role wasn't to expropriate and control the people, but to protect them, and otherwise leave them alone.
I have watched the first video you posted, I may get to the second one later but I need to rest my brain a little. I took some notes so I won't forget my thoughts so far.
So you took the long way to say what anyone with common sense already knew- there is no factual basis to back up the idea that tax cuts for the wealthy is beneficial to our whole economy. The only place where that works is in theory, which was put into action by Dubya... and failed miserably.
Now, I've given you what I believe is evidence for lower taxes creating prosperity. In return, explain to me theoretically why higher taxes on the rich would work?
No need for theory. Here are some proven facts:
BOMBSHELL: New Study Destroys Theory That Tax Cuts Spur Growth
Rachel Maddow provides facts about 'Trickle Down' leading to the ever-increasing wealth gap
One economic theory has been repeated so often for so long in this country that it has become an accepted fact:
Tax cuts spur growth.
Most Americans have gotten so used to hearing this theory that they don't even question it anymore.
One of our two Presidential candidates is so convinced of the theory that he has built his entire economic plan around it--despite the huge negative impact additional tax cuts would likely have on our debt and deficit.
But is the theory true? Do tax cuts really spur growth?
The answer appears to be "no."
According to a new study by the Congressional Research Service (non-partisan), there's no evidence that tax cuts spur growth.
In fact, although correlation is not causation, when you compare economic growth in periods with declining tax rates versus periods with high tax rates, there seems to be evidence that tax cuts might hurt growth. But we'll leave that possibility for another day.
One thing that tax cuts do unequivocally do--at least tax cuts for the highest earners--is increase economic inequality. Given that economic inequality is one of the biggest problems we face in this country right now, this conclusion is very important.
Before we go to the charts, a few observations.
First, this topic has become highly politicized, so it's impossible to discuss it without people howling that you're just rooting for a particular political team. Second, no one likes paying taxes. Third, everyone would like a tax cut, including me.
So I think we can all agree that everyone would prefer that tax cuts actually did spur economic growth.
Well, the bottom line appears to be that low taxes do not spur economic growth and DO cause greater economic inequality.
So, although it sounds like heresy, presidents and Congress-people who actually want to fix the economy might want to consider raising taxes rather than cutting them. Or, at the very least, keeping them the same.
Read more: http://www.businessinsider.com/study...#ixzz2CP2lsjny
So in summary, as you can clearly
see- the theory that tax cuts for the wealthy spur economic growth and everyone reaps the benefits of 'trickle down' wealth is a lie. The facts show that the times of highest job creation, highest gross domestic product (gdp), wealth parity, etc coincide with the times of the highest top tax rate.