response on taxes and economy...

Anonymous said...
Jim

You say look at what made our economy the greatest in the world. If you don't believe in the FairTax fine. Now look at what is ruining our economy in relation to the tax laws of other nations. We are becoming more and more uncompetitive.

Exactly! This is the consequence of our move away from Keynesian economics towards the back of a napkin supply side economics. The Laffer curve is laughable! But the impacts of cutting taxes at the expense of our infrastructure and making the middle class.. and future generations pay for it has hurt us dramatically.

I'll quote myself...

The impacts of the Bush tax cuts have been huge. And it has hurt our business competitiveness around the globe. That is reason--as the book, "the politics of Bad Ideas" points out--that the World Economic Forum the deterioration of the US public finances has begun to damage US competitiveness. This is a business research institute in Switzerland. The US experienced the most dramatic drop in rankings of ALL nations.

Also there is a myth that American businesses are being strangled by taxation at the expense of competitiveness. I'll outsource to Economist Mark Thoma at U. Oregon "The Greek Menace" who brings together some stuff around the web... I'll quote the larger point--aside from conservatives once again manipulating with hyperbole rather than data...

Economist Dean Baker:

Washington Post Misleads Readers to Push for Lower Corporate Tax Rates

Today, the preferred policy is further reductions in corporate income taxes. To advance this agenda the Post tells readers that, "U.S. companies operating abroad already labor under a bigger tax burden than most foreign competitors."

That's not what the OECD says. Data from the OECD show that in the average member country corporate taxes are equal to about 3.5 percent of GDP. In the United States, corporate taxes have generally been between and 1.5 percent and 2.5 percent of GDP over the last two decades, according to the Congressional Budget Office (Table F-4).

But more broadly this decline comes from the conservative revolution. The Regan myth--keep in mind he raised taxes twice to try to correct the harm done from his tax cut at the beginning of his term--of taxes cuts creating economic growth was considered flawed by many economist in theory... and now we have the data to back it up. But the propaganda has remained useful. Our society has become less equitable with the reductions in the top economic bracket. Disparities of wealth over the long term have a huge impact in undermining the market system. We haven't seen such disparities of wealth since the 20's. And we have Regan and the pathology of tax cuts.


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Jim Nichols
A Speculative Fiction
www.JimNichols4.com