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Why do conservatives think small government and low taxes will work this time around?

Discussion in 'Political Discussion' started by Patters, Sep 4, 2010.

  1. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    In the 1920s Hoover cut taxes dramatically and kept government small. Add to that the facts that we had a much more libertarian society--weak labor unions, low wages, even lower wages for blacks, and legal child labor. But, nonetheless those policies ultimately led to the Great Depression. What did Hoover do wrong? He didn't raise taxes until 1932, well after the Great Depression began, in a desperate effort to address the economy.

    In 1937, Roosevelt, succumbed to Republican pressure and cut the federal budget and the country went into another recession (saved 2 years later by deficit spending for WWII).

    Why would things would be different this time? What's the evidence?

    http://en.wikipedia.org/wiki/Calvin_Coolidge
    http://en.wikipedia.org/wiki/Recession_of_1937–1938
     
    Last edited: Sep 7, 2010
  2. reflexblue

    reflexblue PatsFans.com Supporter PatsFans.com Supporter

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    #91 Jersey

    Re: Why do conservatives think small government and low taxes will work this time aro

    Pretty simple to me. The republicans look out for the rich, lower taxes means more money for them. This doesn't usually translate into increased jobs or income for the middle class.
     
    Last edited: Sep 4, 2010
  3. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    Re: Why do conservatives think small government and low taxes will work this time aro

    You're right, so let's leave rates where they are or increase taxes on our wealthiest citizens and cut taxes on the middle class. The middle class is by far THE most important to the health of our economy. Not the poor or the wealthy.
     
    Last edited: Sep 5, 2010
  4. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Re: Why do conservatives think small government and low taxes will work this time aro

    Yet the tax policies you want to go back to largely predate the middle class. The fact is that it was deficit spending that created the middle class with all the military training to gear up for WWII and the incredible GI Bills that gave a college education to a generation. Since that era, we have not provided the same level of help, but then again today most of those who need that kind of help are descendants those who were victims of discrimination during the 1930s and 40s.

    On another point, do you have any evidence that tax cuts and small government work for a capitalist system?
     
    Last edited: Sep 5, 2010
  5. apple strudel

    apple strudel Banned

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    Re: Why do conservatives think small government and low taxes will work this time aro

    Eat the rich.
     
  6. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    Re: Why do conservatives think small government and low taxes will work this time aro

    Given the rate of gov't corruption and ties to corp-America, why would anyone want our gov't to get bigger?

    I don't understand your point above on the middle class. Are you saying you do not support cutting the tax rate on them or are you saying they are not the most important relative to the health of our economy?
     
    Last edited: Sep 5, 2010
  7. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Re: Why do conservatives think small government and low taxes will work this time aro

    I'm fine with a tax cut for the middle class provided it's paid for by people of higher incomes. In fact, I'm for that. But, the health of our economy also depends as much on investing as we have done n the past in those who are struggling and unemployed so that they too can enter the ranks of the middle class.

    As far as government getting bigger, the fact is that the government is really transparent, certainly far more than any corporation. Not only that, it has a series of watchdogs -- the MSM, opposition parties, and special interest groups. The reason people are dissatisfied with politicians is because they can't hide things as easily and are forced to be far more honest than any corporate executive. Ignorance is bliss. Lastly, you have to consider the fact that when government spends, most of that money goes to private enterprises, not to new layers of government employees.
     
  8. patsfan13

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    Re: Why do conservatives think small government and low taxes will work this time aro

    Well Patters the entire premise of the thread is wrong in point of fact Hoover was very interventionist in his policies. He raised tariffs in 1930 (Smoot-Hawley tariffs) and his policies were much like Obama's are.


    Hoover's Attack on Laissez-Faire - Murray N. Rothbard - Mises Daily

    The rest of this article gives a good explanation of the role a meddling government played in the Great Depression just as we see the government worsening our current situation.



    President Hoover Worsens the Great Depression: Government Intervention Turns Economic Recession Into Catastrophe


    Sounds familiar just thing AUto workers Unions and Dem for republican .....




    Why Obanomics = Hoovernomics



    I would urge reading these articles, Hoover was anything but a conservative, just like a guy who murdered hundred of millions (Mao) was a nation builder.
     
  9. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Re: Why do conservatives think small government and low taxes will work this time aro

    patsfan13, there's no dispute that Hoover's interventionalist policies (which involved tax hikes and some baby steps in terms of government spending) were a disaster, but he was trying to address the huge disaster he created by lowering taxes and shrinking government. The Mieses institute is disingenuous when it fails to emphasis that Hoover's policies did not fundamentally shift until two years after the depression and begun and his policies are generally regarded as being too little too late. The way conservatives today try to revise Hoover's history is to use his 1932 budget, but that was anomalous, a result of the utter failure of conservative economic policies.
     
  10. patsfan13

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    Re: Why do conservatives think small government and low taxes will work this time aro

    Citations for that assertion? I see no facts to support massive cuts in government spending and tax cuts from Hoover, it was of course the first financial crisis where the Federal Reserve got involved.


    Again Hoover was anything but a conservative. This is why conservatives reject his and Obama prescriptions. Of course many republicans in office are not conservatives unfortunately. However this seem to be a good chance that a number of conservatives from the Tea Party endorsed group could be elected this november, that will b a good thing but just a start.
     
  11. apple strudel

    apple strudel Banned

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  12. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Re: Why do conservatives think small government and low taxes will work this time aro

    Hoover was Coolidge's Sec'y of Commerce, during which time were cut from their WWI highs (60% or so) to 25%. Hoover also proposed tax cuts of his own, but I don't know if they were approved, and can't find much info about them. Hoover raised taxes back up in 1932, and he did some increase spending, but by that time the social cost of the Great Depression was becoming morally untenable to many people. After all, when you consider that Hoover sent out troops armed with bayonets and tanks to confront WWI veterans demanding their bonuses, it was pretty clear that Hoover had to do something. By 1932, people were vastly more upset than anyone in the Tea Party. It's pretty obvious that low taxes did not prevent the Great Depression and there's no reason to believe that further tax cuts would have ended it shortly. As Obama's record tax cuts show, much of that money is being used by people to pay down debt, not to stimulate the economy.
     
  13. patsfan13

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    Re: Why do conservatives think small government and low taxes will work this time aro

    Point is Patters is that the policies Obama is using will keep the economy in the thank and unemployment at the current high levels.
     
  14. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Re: Why do conservatives think small government and low taxes will work this time aro

    I don't think there's historical evidence to support that. Roosevelt and Reagan both bought their way out of recessions. In fact, when FDR responded to Republican demands and started to reign in government in 1937, the economy went into another recession, which it did not come out of until a year later when it started gearing up for WWII. Really, what we need for this recession is more stimulus and fewer tax cuts because the evidence I've read suggests that Obama's tax cuts mostly went to reducing debt, which means less money for investment by the banks. I think we may need another stimulus, but certainly returning to the days of Coolidge and Hoover will not work now; it didn't even work during the vastly more libertarian days (when discrimination and child labor was legal) of true conservativism.
     
  15. PatriotsReign

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    Re: Why do conservatives think small government and low taxes will work this time aro

    ONe thing that advanced mathmatical econometric models show is that "Balance" can't be forced or even coerced. Capitalism needs to find balance in markets; supply & demand, wages and prices, interest rates vs. demand for credit and so on. There are far too many variables for anyone on this earth to calculate how much money, where to spend the money and when to spend it regarding gov't "pump-priming". The largest variable that no economic model has ever come close to predicting, is basic human behavior.

    I think one thing we can ALL AGREE UPON is that we can't just "Throw" money at a problem and HOPE it works. So, "if" our gov't wants to spend more money to help our economy, they MUST know EXACTLY how, when, where and why it will work. Anyone believe that's possible?

    BTW....it is my honest belief that Roosevelt's policies did nothing to correct the depression other than easing the pain & suffering of Americans. Our current gov't has already tried most what Roosevelt did. We even have food lines in the form of food stamps....same exact thing.
     
    Last edited: Sep 5, 2010
  16. patsfan13

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    Re: Why do conservatives think small government and low taxes will work this time aro



    Reagan slashed taxes and grew government revenue, doubled it actually sadly congress p*ssed it all away. The economy grew and so did employment.
     

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