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Congressional Research Service Finds Tax Cuts as Policy Don't Lead to Growth

Discussion in 'Political Discussion' started by DocHoliday, Oct 24, 2012.

  1. DocHoliday

    DocHoliday In the Starting Line-Up

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    http://graphics8.nytimes.com/news/business/0915taxesandeconomy.pdf

    Linked to the NYT's hosted version, but it's from crs.gov

    Here's an opinion article on NYT that digests it further for those of you too lazy to read.
    http://www.nytimes.com/2012/09/16/opinion/sunday/do-tax-cuts-lead-to-economic-growth.html?_r=1&hp

    When will trickle down be laid to rest?
     
    Last edited: Oct 24, 2012
  2. IcyPatriot

    IcyPatriot ------------- PatsFans.com Supporter

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    #24 Jersey

    I'd much rather see corporate taxes cut for companies that locate and employ in the USA.
     
  3. DocHoliday

    DocHoliday In the Starting Line-Up

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    Effective tax rate is already pretty low. Nominal tax rate seems high, but nobody pays that. We should just lower the tax rate to the nominal rate, since the only people paying that high rate are the medium sized businesses that are too big to file as a person (owner) but can't afford an army of lawyers to shuffle funds to obscure mail boxes in Dubai using complex schemes.
     
    Last edited: Oct 24, 2012
  4. Gainzo

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    #11 Jersey

    Federal tax rates are at an historic low so I don't understand the need to cut them anymore.

    State tax rates are down as well.....................but local tax rates are sky high.

    The Republicans not only preach trickle down economics, they preach trickle down taxes.

    When Romney was the Governor of Massachusetts he pushed the tax burden down to the Cities and Towns by cutting State funding. That is the only way he could balance*$ the budget.

    *The Massachusetts constitution requires a balanced budget.

    $Thanks for raising all of the fees at the Registry
     
  5. DarrylS

    DarrylS PatsFans.com Supporter PatsFans.com Supporter

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    I am still waiting for that wealth to trickle down, as promised by Reagan....

    Should I give up????
     
  6. Drewski

    Drewski In the Starting Line-Up

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    You should Darryl absolutely.

    As a theory - it "should work". But the theory doesn't account for one critical input, human beings.

    In a previous post here (discussing this topic with WP) I likened trickle down wealth (taxes) to taxes levied on cigarettes.

    In each case, taxes are being used as a vehicle to induce a desired behavior. In the case of trickle down wealth, the theory (as we know) is to tax the top less, and their gains will be passed on down the line. In the case of cigarettes, you tax them more to drive people to smoke less.

    In both cases, the desired outcome can work for some, but wont for all. I'm a smoker....and the taxes used to raise a pack of cigarettes to 8.40 a pack here in MA have had zero impact on my consumption. Am I dumb/selfish/[enter your term]? One could say that. But what I do know is I am is an example of where taxing (or not taxing) a behavior just doesn't work....because at the end of the day, my addiction/desire/wants/needs outweighs the "cost" of doing so.

    I think the same idea can be applied to trickle down. Sure, if you lessen the tax burden on some folks, they will turn around and "pay it forward" which jobs, increased investment etc etc etc. But there are just as many (if not more) who will just take that increase and use it for their wants/needs.

    Obviously I my view is somewhat simple...and people are anything but.

    D
     
  7. IllegalContact

    IllegalContact Pro Bowl Player

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    no....keep trying
     
  8. wistahpatsfan

    wistahpatsfan Pro Bowl Player

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    #75 Jersey

    The BIG LIE
     
  9. PATSNUTme

    PATSNUTme Paranoid Homer Moderator Staff Member PatsFans.com Supporter

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    #75 Jersey

    Tax increases certainly do not lead to economic growth. Or is there a study, like this one, that claims that it does.

    I guess that it was just a coincidence that under Reagan 22 million jobs were created? Clinton had jobs created with slightly higher tax rates but that could be have due to the .com bubble. And W had jobs created with the current tax rates but that could have been due to the housing bubble.

    I do know when they passed a tax on "luxury items", the middle class lost jobs and small business hurt, but the rich still were rich.

    It's really not about rates anyway. It's about revenue and spending. I'd like to see a flat tax and a small national sales tax.
     
  10. DocHoliday

    DocHoliday In the Starting Line-Up

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    Correlation does not equal causation.

    If it did, you'd concede that Republican policies lead to massive economic failure. (00-08)

    Right?
     
  11. alvinnf

    alvinnf In the Starting Line-Up

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    We currently have a spending problem. Started with Bush and perpetuated by the current administration. Policy uncertainty and spending. Fatal! Most people dont pay taxes. If we spent less dough even less people would have to pay tax, look at it that way.
     
    Last edited: Oct 25, 2012
  12. DocHoliday

    DocHoliday In the Starting Line-Up

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    Let's start with the military.
     
  13. The Brandon Five

    The Brandon Five Experienced Starter w/First Big Contract

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    #75 Jersey

    What is the mechanism by which tax policy leads to skewed distribution of income? We may be dealing with correlation vs. causation. I think a larger contributor to declining wages as a percentage of GDP and the concentration of wealth is that our current environment heavily favors both big business and big government.


    Federal pay ahead of private industry - USATODAY.com
    Centralization ---> Concentration
     
  14. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    "Congressional Research Service Finds Tax Cuts as Policy Don't Lead to Growth"

    Neither does stimulus'/stimuli (?)....do you support either one?
     
  15. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    How would you suggest we deal with the massive job losses that we know would result from cutting defense spending?

    Keeping in mind that job losses ALWAYS result in declines in tax revenues.
     
    Last edited: Oct 25, 2012
  16. Drewski

    Drewski In the Starting Line-Up

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    Could the argument be made that by cutting the Military Budget by $X, that those Federal Dollars would be invested into another sector of the country/economy?

    If so, then wouldn't there be an increased demand in those sectors?

    I'd much prefer spending $$ on creation/improvement than destruction.
     
  17. The Brandon Five

    The Brandon Five Experienced Starter w/First Big Contract

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    #75 Jersey

    Beyond that we are at the point where the entire defense budget is funded by borrowing. If the majority of that borrowing comes from other countries (currently the majority comes from money printed by the Fed) that puts us in a pretty vulnerable position.
     
  18. wistahpatsfan

    wistahpatsfan Pro Bowl Player

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    #75 Jersey

    The Military is NOT a jobs program!
     
  19. IllegalContact

    IllegalContact Pro Bowl Player

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    Like what?

    the one side effect of much of what is spent on defense is the jobs that get created at defense contractors. I'm not saying it shouldn't be cut, but I'm not sure there is some other place in government to spend the money that will produce any kind of return on investment

    spending it on entitlements is not the answer.......that's a zero ROI
     
  20. Drewski

    Drewski In the Starting Line-Up

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    I was thinking about bigger things....like an "Energy Race".

    I wouldn't spend it on Entitlements.

    Finding a true replacement for fossil based fuels would have wide ranging positive impacts for us.

    Cold Fusion, Hydrinos, Helium 3 and the like. Turn Science Fiction into Science Fact (cheesy I realize).
     
    Last edited: Oct 25, 2012

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