General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsGothmog
(145,464 posts)unblock
(52,283 posts)obviously it's possible that tax rates are stiflingly high, in which case lowering them would help.
but we're talking really high numbers, well over 50% tax rates.
think about it. if taxes are 60% and they cut it to 50%, that changes your take-home pay from 40% to 50%, i.e., you're effectively making 25% more for the same work. but is that really going to make you put in more hours or start a business you otherwise wouldn't? for most people the answer is no. for some it is yes, but for most it is no. certainly not enough yes's to make up for the loss in revenue from the government's point of view.
cutting from 95% to 90%, on the other hand, that's a clear winner. the government isn't losing much from cutting rates (just over 5%) but your take-home pay doubles from 5% to 10%. that's a huge incentive and it actually would cause more work for many people.
otherwise, tax cuts for the rich only really work when there's a shortage of investment capital. if they have more money to play with, and there are good investment opportunities but little capital, then a tax cut could help make these investment ideas happen. but that's a very specific condition that hasn't existed in this country in a long time, probably not since about 1960. if the rich already have more than enough to invest, then any extra they get is certainly not going to be invested. it will be spent or saved, possibly leading to asset inflation (i.e., bubbles in existing investments, not new ones).
tax cuts for the *working class* on the other hand, very often have a good return, because it's usually spent largely locally, so mostly in the u.s. rich people benefit, too, but only after they *work* to extract that money from the working class in the form of profit in exchange for goods and services....
this works whenever the working class is demand-starved, which is pretty much all the time.
Baitball Blogger
(46,753 posts)This is what most Liberals think it is. It's actually far worse. There is trickle down, but it is patronage inducement money. Simply put, there's not enough to go around so those at the top, which tend to be autocratic, use it to reward those that do not challenge them.
BigmanPigman
(51,618 posts)during their golden years, that is for sure! There is no giving away their fortunes or being philanthropists from these brothers of self interest and greed.
Bernardo de La Paz
(49,027 posts)The 1% drop money in a non-productive black hole by inflating the price of real estate and art works.
dalton99a
(81,564 posts)BillyBobBrilliant
(805 posts)plumbing systems for forty years, and there is only one thing that consistently 'trickles down.'