WTF! Bush's solution to the recession is a $145 Bil tax cut!

What is Supply Side Economics?
By Paul Craig Roberts
February 27, 2006

Supply-side economics was a major innovation in macroeconomic theory and economic policy. It was a correction of an oversight, not a magical formula. A quarter century ago before the days of the high speed Internet and US offshore outsourcing, supply-side economics revitalized the economy’s ability to grow without having to pay the price of rising rates of inflation. This battle was fought and won long ago. Re-fighting it is a waste of time and energy in an era of new serious problems.

The George W. Bush regime was faced with no stagflation and no worsening trade-offs between employment and inflation. The Bush administration did not use changes in the marginal rate of taxation to correct a mistaken policy mix or an oversight in economic policy. Moreover, global labor arbitrage is causing American jobs to be outsourced abroad. As Americans are experiencing declining opportunities to work, the response of labor supply to better incentives is small. Similarly, US companies are locating their investments in plant and equipment abroad. The substitution of foreign for American labor and the relocation abroad of US plant and equipment prevent reductions in marginal tax rates from having any appreciable effect on aggregate (job) supply in the US.

I am not a partisan of Dubya’s tax cuts. Income distribution is a legitimate issue. This is especially the case when offshore production and jobs outsourcing are destroying the American middle class.

Just as Dubya hides behind "freedom and democracy" to wage wars of naked aggression, he hides behind supply-side economics in order to reward his cronies. There seems to be no American value or legitimate principle that the Bush regime is incapable of despoiling.

http://www.vdare.com/roberts/060227_economics.htm