Bush tax cuts

[cilla4progress]

Answer me this: if the Bush tax cuts work so well according to the right they must not expire, then WHY IS OUR ECONOMY IN FREEFALL now?

[RandomThoughts]

1. Because it depends what 'working' is defined as.

[dkf]

2. They don't work well but the screwed up structural imbalance of our economy results

In our needing to keep them in til the economy recovers.

Basically the top 5% is responsible for 37% of consumption. You crimp that and the economy could get worse. We started improving earlier this year because the savings rate for the top earners went negative. The recent fall in the stock market scared them back into their hidey holes and the economy looks shaky again.

The way to wean us off dependence on consumption by the rich is to let the economy get into a groove where it looks self sustaining, then cut the Bush tax cuts, then start to figure out how to solve the imbalance problem. If we start by increasing taxes on our major consumers and that lands up decreasing spending that is when the average Joe loses his job.

In any case you cannot tax the major beneficiaries of the Bush tax cuts because they already escaped those taxes. The best solution is to make up for the Bush tax years through the Estate tax. If this leads to greater consumption while they are alive then great.

I am suspicious of this Billionaire charity thing though. I would think keeping the US solvent should be of importance too.

[cilla4progress]

3. I beg to differ --

instead of leaving that money in the hands of the wealthy where they are free to hold onto it, invest or spend it offshore or WHATEVER! -- you plow it back into the AMERICAN economy in the form of taxes.

Whose philosophy are you basing your explanation on?

[dkf]

4. Basic economic theory?

Someone has to consume to keep this economy running after all. Spending needs to be at higher levels to create jobs not lower levels

[cilla4progress]

5. Maybe that's why this economy isn't running!

Spending can be either by the private or public sector.

[Hannah Bell]

6. and if the gov't took their money & hired people to dig holes & fill them back in,

those people would spend it.

taxes go back into the economy as spending.

[Kat45]

7. Yes. Where are all the jobs they created while they had lower taxes?

<tapping foot> Still waiting to see them.