The Fallacy that Tax Cuts Stimulate Economies

[Havakasha]

Just so people reading this thread know what the original (hijacked) thread was about, here it is for the 3rd time. I quess it was too painful for "some" to focus on.


The fallacy that tax cuts stimulate economies
bykos

The tax cuts were supposed to stimulate Ohio's economy and create jobs. But that never happened once the economy tanked. Instead, the changes ended up costing Ohio more than $2 billion a year in lost tax revenue; money that would go a long way toward closing the state's $8 billion budget gap for fiscal year 2012 [...]
Across the country, taxpayers jarred by cuts to government jobs and services are reassessing the risks and costs of a variety of tax reductions, exemptions and credits, and the ideology that drives them. States cut taxes in hopes of spurring economic growth, but in state after state, it hasn't worked [...]

A 2008 study by Arizona State University found that that state's structural deficits could be traced to 15 years of tax cuts, mainly income-tax reductions that "were not matched by spending cuts of a commensurate size."

In Texas, which faces a $27 billion budget deficit over the next two years, about one-third of the shortage stems from a 2006 property tax reduction that was linked to an underperforming business tax.

In Louisiana, lawmakers essentially passed the largest tax cut in state history by rolling back an income-tax hike for high earners in 2007 and again in 2008.

Without those tax reductions, Louisiana wouldn't have had a budget deficit in fiscal year 2010, the 2011 deficit would've been 50 percent less and the 2012 deficit of $1.6 billion would be reduced by about one-third.

While states have destroyed themselves gifting money to their richest, don't forget George W. Bush's contributions at the national level:

There is no evidence that perpetual tax cuts stimulate any economies. Instead, GOP-fueled cuts end up decimating the kinds of assets that do attract businesses -- an educated workforce, infrastructure, and quality of life features (like parks and cultural facilities) that attract top talent. There's a reason that places like NYC and the SF Bay Area continue to attract new businesses despite their high taxes. A top-notch business environment costs money to maintain.

Republicans cut taxes in pursuit of their magical pony, decimating state budgets as they prattle on about "fiscal responsibility". The end result? Red ink as far as the eye can see, and economies further in the gutter.

[SiriuslyLong]

Just so everyone knows, it is a liberal talking point to say that tax cuts do not stimulate the economy. Here is empirical proof - http://siriusbuzz.com/forum/showthre...sh-vs.-Clinton.

Secondly, let's use a common sense example. Say the Federal Government helps itself to ~$25,000 of your hard earned income. Now they finally realize that taking ~$25,000 from a middle class family is too much, so they reduce that tax burden to half of that, $12,500. What do you think that family is going to do with that money?

a.) save it
b.) spend it
c.) a little bit of both

Are any of these bad choices?

[Havakasha]

Its a Conservative Republican talking point to say that tax cuts are the panacea of EVERYTHING economic. They are obviously not as my thread i believe demonstrates. Unfortunately S&L would prefer not to deal with the article i posted.

My thread was about Texas, Ohio, Louisiana etc. and their budget deficits caused by among other things tax cuts.
I know you dont want to face some of those facts i posted but why not give it the ole College try? lol

[SiriuslyLong]

I don't recall saying that tax cuts are a panacea for EVERYTHING. My example speaks for itself.

College try? Likewise. Bush collected more income tax revenue than Clinton did WITH a lower tax rate, and the rich paid more. No funny math Lloyd. And by the way, you haven't even come close to addressing this FACT of simple mathematics. Note to Lloyd, 2 + 2 will always = 4. Go to the IRS website (linked provided in the article) and try to add them differently.

If you want to deflect the conversation to TX, OH, LA, well then be my guest. I just wanted to correct you that tax cuts many times do have a positive impact.

The evil corporation I work for handed me this nice new Dell today. Man is it nice. Fast, meaning more posts per hour

[Havakasha]

You dont know that tax cuts are a panacea for everything? Do you actually follow Schiff and all the other Conservatives you quote.
I will produce a thread for you which will explain it.

"if you want to deflect the conversation to TX, OH, LA well than be my quest." Hilarious. Here is the THREAD which I started.
Its only the 4th time i posted it.

The fallacy that tax cuts stimulate economies
bykos

The tax cuts were supposed to stimulate Ohio's economy and create jobs. But that never happened once the economy tanked. Instead, the changes ended up costing Ohio more than $2 billion a year in lost tax revenue; money that would go a long way toward closing the state's $8 billion budget gap for fiscal year 2012 [...]
Across the country, taxpayers jarred by cuts to government jobs and services are reassessing the risks and costs of a variety of tax reductions, exemptions and credits, and the ideology that drives them. States cut taxes in hopes of spurring economic growth, but in state after state, it hasn't worked [...]

A 2008 study by Arizona State University found that that state's structural deficits could be traced to 15 years of tax cuts, mainly income-tax reductions that "were not matched by spending cuts of a commensurate size."

In Texas, which faces a $27 billion budget deficit over the next two years, about one-third of the shortage stems from a 2006 property tax reduction that was linked to an underperforming business tax.

In Louisiana, lawmakers essentially passed the largest tax cut in state history by rolling back an income-tax hike for high earners in 2007 and again in 2008.

Without those tax reductions, Louisiana wouldn't have had a budget deficit in fiscal year 2010, the 2011 deficit would've been 50 percent less and the 2012 deficit of $1.6 billion would be reduced by about one-third.

While states have destroyed themselves gifting money to their richest, don't forget George W. Bush's contributions at the national level:

There is no evidence that perpetual tax cuts stimulate any economies. Instead, GOP-fueled cuts end up decimating the kinds of assets that do attract businesses -- an educated workforce, infrastructure, and quality of life features (like parks and cultural facilities) that attract top talent. There's a reason that places like NYC and the SF Bay Area continue to attract new businesses despite their high taxes. A top-notch business environment costs money to maintain.

Republicans cut taxes in pursuit of their magical pony, decimating state budgets as they prattle on about "fiscal responsibility". The end result? Red ink as far as the eye can see, and economies further in the gutter.

P.S. You work for an "evil corporation"? Wow you better get of there quick.

[SiriuslyLong]

Also note in your article that one compelling reason for the cuts not benefitting is that SPENDING wasn't reduced (aka policitians catering to their constituants). It seems as if the aweful folks who wanted to save middle class people like myself a buck were unable to compell others that government spending needs to be reduced as well. Yet another failure of Government as a whole (and the list goes on......................).

[SiriuslyLong]

And lastly,

"Instead, GOP-fueled cuts end up decimating the kinds of assets that do attract businesses -- an educated workforce, infrastructure, and quality of life features (like parks and cultural facilities) that attract top talent. There's a reason that places like NYC and the SF Bay Area continue to attract new businesses despite their high taxes. A top-notch business environment costs money to maintain."

Nice thought, but low cost is the driver. You should have learned that from the story of Evergreen Solar. And I would argue the comment about SF and NYC. Who the phuck makes anything there? How do those locations help the middle class? The article is a liberal pump piece. Be informed.

[SiriuslyLong]

Priceless!!! Great discourse Lloyd.

[SiriuslyLong]

Now do you see how fast this new Dell is? I have to go eat some salmon - coho.

[Havakasha]

Wow. S&L is actually addressing something in my thread. Too bad he is distorting it to his own rigid beliefs.

Umm how do we let S&L in on the secret fact that right now as we speak Govt is working to cut spending?
Yes we spent a lot in the last 10 years or so( sometimes on very necessary things and sometimes on wasteful
things) Kind of like what individuals and families did.
And we reduced taxes too much on the wealthy.
And we are going to have to reduce some of that spending and continue some of that spending and we are going to have to raise revenues in some areas and reduce in some other areas.
Oh my.
But of course its all some entity separate from us citizens that is responisbile for ALL our problems. Wah!

P.S. Im really starting to worry that S&L might secretly be an anarchist.