Re: LVT dustup over at AngryBear

"ruetheday@xxxxxxxxxx" <ruetheday@xxxxxxxxxx> wrote in
news:1122770809.635030.113360@xxxxxxxxxxxxxxxxxxxxxxxxxxxx:

> Really? I found his comment that a high and steeply progressive income
> tax is the ultimate solution for unemployment to be completely
> misguided and illogical. While there is definite merit to the use of
> traditional Keynesian fiscal policy as a countercyclical stabilization
> mechanism, the idea that chronic unemployment is a problem best solved
> through the application of higher taxation on productive activity (such
> as labor itself) is absurd.


Not at all.

If anything is absurd, it is the insistence of supply-siders that there
is an inverse correlation between taxes and economic growth. Supply-
siders continue to cling to the fantasy that lower taxes automatically
boosts GDP even when shown data that refutes their argument.

1951 to 1964: the top marginal rate was 91% for incomes of $200,000 or
more. During the same period GDP rose from $329 Bil to $563 Bil (today's
dollars), or about +4.6% annual growth. Today, with the top marginal rate
of 35%, we are averaging about +3.5% annual GDP growth. Supply-side
theory always falls apart when tested with real data.

Supply-siders are wrong, there is no statistical correlation between
economic growth and taxation. Growth happens despite taxation. I believe
taxation spurs economic growth because the government always spends
taxes, which in turn disperses money among corporations, supply chains
and individuals, who in turn purchase goods and services, which
stimulates more hiring, spendings, taxing, and so on. OTOH, supply-side
economics concentrates money into few hands, drying up demand among the
lower-income population and ultimately causing economic contraction.

.

Relevant Pages

  • Re: LVT dustup over at AngryBear
    ... While there is definite merit to the use of traditional Keynesian fiscal policy as a countercyclical stabilization mechanism, the idea that chronic unemployment is a problem best solved through the application of higher taxation on productive activity is absurd. ... it is the insistence of supply-siders that there is an inverse correlation between taxes and economic growth. ... Supply-side theory always falls apart when tested with real data. ...
    (sci.econ)
  • Re: LVT dustup over at AngryBear
    ... it is the insistence of supply-siders that there ... >is an inverse correlation between taxes and economic growth. ... Growth happens despite taxation. ...
    (sci.econ)
  • Re: LVT dustup over at AngryBear
    ... it is the insistence of supply-siders that there ... >>is an inverse correlation between taxes and economic growth. ... income from capital gains taxed at 28%. ...
    (sci.econ)
  • Re: LVT dustup over at AngryBear
    ... >>Supply-siders are wrong, there is no statistical correlation between ... >>taxation spurs economic growth because the government always spends ... In truth there is an enormous pool of funds comprising the ... 2003 real incomes: ...
    (sci.econ)
  • Re: US unemployment worse than UK, Holland, Norway, Austria, Luxembourg, Lithuania, Cyprus, Japan an
    ... A Monkey wrote: ... but actually depends on periods of unemployment ... And is the blueprint for the free movement of labour within the EU. ... Economic growth can be stunted by a lack of labour supply... ...
    (uk.politics.misc)