If I remember my macroeconomics class correctly, isn’t any tax cut a keynesian stimulus, just as any government spending is a stimulus. According to the theory, in both cases shouldn’t either one have some type of temporary multiplier effect on GDP as whoever gets the tax cuts spend the money on goods which then goes to pay workers which then spend the money, etc.?
It seems to me that dems should be for the tax cuts purely because the deficit spending should boost GDP. Wasn’t Krugman worried that if we don’t spend more that the economy will tank and that we shouldn’t worry about deficits right now? Where is he out there championing all these tax cuts?
And why haven’t I heard anyone in the GOP make these points? Also, why haven’t I heard them talk about how much the ‘rich’ pay in taxes relative to their income? I think the top 5% earn 40% of the income and pay something like 60% of income taxes. That seems to me about 50% more than their fair share.
Moe Lane
PG DeFreese
Victoria Coates
Daniel Horowitz
Dan Spencer
Because They Had To
Repair_Man_Jack (Diary) Tuesday, December 7th at 3:28PM EST (link)How could we need more Keynesian Stimulus after the glorious Recovery Summer after all?
Mr. Obama is pretending that an economic “recovery” is underway when he knows damn well that the banking system is just blowing smoke up the shredded *** of what’s left of that economy – James Howard Kunstler
Logic!
Cargosquid (Diary) Tuesday, December 7th at 4:10PM EST (link)It burns!
Then again, if you do believe that Keynesian economics works…..
They only champion targeted redistribution
Jeff Mericle (Diary) Wednesday, December 8th at 3:17PM EST (link)The left prefers to take the money out of the economy and then direct it to where they see fit, rather than allowing the money to flow naturally and by the choice of the individuals who earned it in the first place. Their particular favorite is targeted stimulation of their voting constituencies. So since folks are still able to keep their money and spend it as they see fit, the left is upset.
I read in yesterday’s Wall Street Journal that some of these cuts are not paid for and therefore will be deficit spending. So you bring up a good point about Krugman: He ought to be glad that we will continue deficit spending and extend unemployment benefits.