My friend and I are currently in a debate regarding economic policies and taxes.

[bigboii121]

My friend gave me an essay defending trickle down and cutting taxes on the rich, i myself hold a more liberal view . So I would like y'all to fact check his essay and possibly share your own opinions. Cheers

 

[Aunt Antifa]

My friend gave me an essay defending trickle down and cutting taxes on the rich, i myself hold a more liberal view . So I would like y'all to fact check his essay and possibly share your own opinions. Cheers

Why don’t you offer an opinion so we can know what you think too. Your friend isn’t here to defend his arguments.

 

[bluesmoke]

Trickle-down does not work, except for the rich and large corps, and, being regressive, is antithetical to our tax system as designed, being a progressive one, that the Republicans have been rather successful at regressing at every possible turn with the Dems looking on. Hence, wages have not kept up with either productivity or COL while the rich and large corps accumulate wealth and widen the wealth gap btx the lower and highest income levels, with the lower levels NOT accumulating appreciable wealth.

 

[AliHajiSheik]

Don't viruses sometimes get distributed through PDF's?

 

[Common Sense 1]

You probably should fact check the document. I doubt anyone here wants to
fact check for you.

 

[ttwtt78640]

Why don’t you offer an opinion so we can know what you think too. Your friend isn’t here to defend his arguments.

Hmm... is the OP perhaps trying to get help with their homework? Just asking for a friend.

 

[Peter]

So if the theory of trickle down works then giving me $100B will somehow magically make everyone richer as I'll immediately go on a hiring and spending spree?

Sure, I'll buy a big house but how much stuff do I need?

 

[ttwtt78640]

So if the theory of trickle down works then giving me $100B will somehow magically make everyone richer as I'll immediately go on a hiring and spending spree?

Sure, I'll buy a big house but how much stuff do I need?

The theory is based on private spending/investment being better for GDP growth than public “safety net” spending. Of course, that assumes a reduction in federal taxation revenue would result in a reduction of (specific?) federal spending - which does not happen.

 

[Peter]

The theory has always seemed silly to me.
All it does is concentrate wealth in the hands of a select few who will chuck most of it in the bank rather than spreading it out over a larger amount of people who will spend it.

Giving 100 people $1k each is better than giving 1 person $100k.

 

[ttwtt78640]

The theory has always seemed silly to me.
All it does is concentrate wealth in the hands of a select few who will chuck most of it in the bank rather than spreading it out over a larger amount of people who will spend it.

Giving 100 people $1k each is better than giving 1 person $100k.

Taking $100K from one person and giving $1K to 100 people is certainly likely to generate more votes.

 

[Rexedgar]

When is the assignment due?

 

[code1211]

My friend gave me an essay defending trickle down and cutting taxes on the rich, i myself hold a more liberal view . So I would like y'all to fact check his essay and possibly share your own opinions. Cheers

"Trickle down" is a biased and propagandistic reference to describe market driven forces dictating out comes.

So, under Trump, about 11,000 jobs are created to build the Keystone XL Pipeline. pipelines make transport of gases and fluids far more efficient. Biden stops this putting 11,000 high paid workers out of work.

Also eliminated will be the 4 to 5 support jobs that exist as a by product of the wages paid and then spent by folks in this sort of base industry.

The oil will still be taken from the ground, the oil will still still be shipped and the oil will still be refined.

Biden's stupid plan will end up raising costs for that oil, increasing CO2 produced in the process of transport by either truck or train and do NOTHING to help the environment.

Biden's plan is based on political deception, cronyism and expected pay backs to his campaign funds. Trump's plan was based on Market Driven Forces to deliver the same product as a better cost with less effort.

Which plan makes more sense to you?

 

[Aunt Antifa]

Hmm... is the OP perhaps trying to get help with their homework? Just asking for a friend.

Not the worst plan in the world! Might even work too. -_-

 

[Luce]

My friend gave me an essay defending trickle down and cutting taxes on the rich, i myself hold a more liberal view . So I would like y'all to fact check his essay and possibly share your own opinions. Cheers

Yeah, I have friends like that. One guy is a Nigerian prince, and he won't shut up about his money.

 

[SimpleTom]

My friend gave me an essay defending trickle down and cutting taxes on the rich, i myself hold a more liberal view . So I would like y'all to fact check his essay and possibly share your own opinions. Cheers

May I ask what class (and level of school) did your friend write this for, as there are some significant issues.

 

[rickc]

Art Laffer's trickle down economic theory has worked fabulously for those who it was designed to enrich. Now for the rest of us we got pissed on. The results are quite obvious in the following graphs

 

[rickc]

 

[SimpleTom]

My friend gave me an essay defending trickle down and cutting taxes on the rich, i myself hold a more liberal view . So I would like y'all to fact check his essay and possibly share your own opinions. Cheers

Just to be clear, I didn't read the entire thing, when you got to the Laffer curve I stopped, however, if this paper were submitted by one of my students I would not give it high marks.

First, the Laffer curve has nothing to do with the optimal tax rate. It is just a statement on revenue collections and in OECD countries that curve is shifted pretty far to the right. Our current estimation is that the optimal tax rate is around 70%. It shouldn't be used to describe the value of economic policies to stimulate the economic output which is the optimal tax rate. That is a completely different thing. So the Laffer curve was never used by anyone to really explain the supply side focus of Reaganomics, because it is inadequate to do so. It is essentially like using a thermometer to measure the volume of water, it is simply the wrong tool for the job.

Next, the Laffer curve was a thought experiment on the two end points of the system and not the curve in between. Even those two points require a fairly massive assumption. So the statement really works best as, if no incentives are provided, a 0% and 100% tax rate generate the same tax revenues. Add in a few incentives and the Laffer curve crashes. You can tax people 100% and give benefits based on some value of their work and the tax rate will never drop to zero. There have been hundreds of examples of subsistence living under a 100% tax rate that produced economic activity. If you can't think of a single time in American history where a certain group of people had 100% of the labor productivity taken from them and still produced fairly substantial labor productivity, then you are not trying real hard.

I only skimmed beyond the Laffer curve part as this was a fatal flaw in the paper.

 

[mrjurrs]

My friend gave me an essay defending trickle down and cutting taxes on the rich, i myself hold a more liberal view . So I would like y'all to fact check his essay and possibly share your own opinions. Cheers

Sorry, I read enough papers. However, I will give you an example that I feel accurately describes 'trickle-down' policies.

Feeding time at the trough...
Each day the bulls would come to the feeding trough to eat their corn. The farmer fills the trough with corn (national tax revenue). The bulls (rich folk) get to eat all the corn they want. The sparrows (the rest of us) fly around, and some of them get kernels of corn. The majority of the sparrows are left to eat the corn that has passed through the bull.

 

[bluesmoke]

The theory is based on private spending/investment being better for GDP growth than public “safety net” spending. Of course, that assumes a reduction in federal taxation revenue would result in a reduction of (specific?) federal spending - which does not happen.

And the gdp growth is never more than w/o tinkle-down and not shared with the general pop evidenced by the widening wealth gap and lack of real (accounting for inflation) mean (not avg) wage growth, while worker productivity has increased over the last, over the last 70+ yrs.

 

[rickc]

And the gdp growth is never more than w/o tinkle-down and not shared with the general pop evidenced by the widening wealth gap and lack of real (accounting for inflation) mean (not avg) wage growth, while worker productivity has increased over the last, over the last 70+ yrs.

According to Republicans tax cuts are supposed to create GDP growth. Massive tax cuts and little to no change in GDP growth. In fact the inverse may actually be true.

 

[ttwtt78640]

And the gdp growth is never more than w/o tinkle-down and not shared with the general pop evidenced by the widening wealth gap and lack of real (accounting for inflation) mean (not avg) wage growth, while worker productivity has increased over the last, over the last 70+ yrs.

One odd thing about GDP is that it seems totally unrelated to ‘productivity’. Note that DC has, by far, the highest per capita GDP in the nation - what, exactly, does DC ‘produce’ so much of?

D.C. tops the list of the US states ranked by GDP per capita. The state’s GDP per capita is a soaring $178,442 and over two times more than the 2nd highest GDP per capita of $75,258. As for its GDP in US dollars, D.C. is among the 20 states with the lowest GDP by state. Still, D.C. saw its economy grow from $144 billion in Q1 of 2019 to $148 billion in Q1 of 2020.

GDP by State — A Full Rundown 2023 | Balancing Everything

See how American state economies have slowed down as knowing the GDP by state is essential for forecasting the US economy's future trends.

balancingeverything.com

 

[NWRatCon]

The theory is based on private spending/investment being better for GDP growth than public “safety net” spending. Of course, that assumes a reduction in federal taxation revenue would result in a reduction of (specific?) federal spending - which does not happen.

Sentence one is a gross misrepresentation of reality, is premised on government as sugardaddy, but does accurately describe the insanity of trickle down theorists. The second sentence does represent reality. The problem of trickle down economics has always been its complete disconnect from reality, which is why it has never ever worked economically, and can't.

I believe in the incredible power of the private sector to generate GDP (a very artifical measure of productivity, the topic for another discussion), but decoupling that from the operation of government and the raising of revenue to support it is just plain nuts. Moreover, the theory completely ignores the purposes of government, based instead upon the supposition that "government is bad" without elaboration or nuance. It's a Libertarian fantasy and a realist's nightmare. Government has real purpose - including providing for the general welfare - has real needs, and provides real value to the stability and profitability of the private sector.

 

[ttwtt78640]

Sentence one is a gross misrepresentation of reality, is premised on government as sugardaddy, but does accurately describe the insanity of trickle down theorists. The second sentence does represent reality. The problem of trickle down economics has always been its complete disconnect from reality, which is why it has never ever worked economically, and can't.

I believe in the incredible power of the private sector to generate GDP (a very artifical measure of productivity, the topic for another discussion), but decoupling that from the operation of government and the raising of revenue to support it is just plain nuts. Moreover, the theory completely ignores the purposes of government, based instead upon the supposition that "government is bad" without elaboration or nuance. It's a Libertarian fantasy and a realist's nightmare. Government has real purpose - including providing for the general welfare - has real needs, and provides real value to the stability and profitability of the private sector.

It seems to boil down to whether government is choosing to subsidize private production or private consumption. Borrowing (from future generations?) to allow increased production makes sense, while borrowing to simply support current consumption is foolish.

 

[NWRatCon]

I have always found it a laugher that those who most often reference the Laffer curve understand it the least. There's a lesson in that, somewhere.