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Welcome to my blog. Essays on my thoughts on anything and everything, original photography, philosophical musings, spiritual beliefs, political rants, and shameless promotion of things I think are good for us individually, collectively as citizens of the United States of America and good stewards of the planet Earth. We must honor our higher lights and face our inner demons in the diverse forms they appear in our world. The more people with whom we can share common awareness, regardless of our egocentric perception, the larger our personal share of the Human Spirit.

Many of the photographs on the blog are original photography taken by me with my trusty cell phones and now BlackBerry. Some others have been with an array of off the shelf digital cameras. The subtle double rainbow on the title was photographed east of my home on 10/15/2010 at 6:23 PM on my BlackBerry. For a campy, tongue in cheek look at the meaning or non-meaning of double rainbows, check this out, or if you're more interested this...

Thanks for visiting. Feel free to leave comments, pro or con. It's how we learn from each other. Peace


-Gerard


6/29/2011

My Education in Conservative Supply Side Economics

A Friend's Attempt to Teach Me the Benefit of Supply Side Economics
                                                                       - No thank you, I'll pass.
Gerard J. Zarella 20011
                                                                                        with contribution from a Facebook friend.

     After I published the following post on my Facebook page, an admitted Conservative/Libertarian friend of mine thought that he should educate me in Conservative supply side economics.  This same friend in other posts thinks that people who haven't made it just haven't tried hard enough, which I've heard and read from other pundits on the Right.  What they just don't get, historically Reagan-esque supply side economics - trickle down economics - or the name I like - Voodoo economics - doesn't work!  History bears out the fact that after Republican tax cuts, the economy does not react in the manner that the high priests of Voodoo economics want us to believe.  Supply side economics is simply the manipulation of popular economic theory that doesn't pan out in practice.  I've only edited bad grammer and spelling in my comments.  Sometimes, writing quickly on forums like Facebook doesn't demonstrate our best writing ability in the name of brevity.

The original post:
Gerard Zarella  GOP-Tea Party Voodoo Economics Explained - Raise taxes lower revenues - lower taxes raise revenue. Really? YumaSun: http://bit.ly/mMg9Uj 
My friend, whose name I've redacted here to protect his privacy begins my enlightenment: 
****** Um, yes - really. Money doesn't have to pass through government hands in order to benefit the general population. And, lower taxes stimulate the economy, not artificial stimulus packages. More business and home sales and commerce means more collected in tax revenues. Has always worked this way and always will. You need to take an introductory economics course.
I'm always impressed by the way the Right seems to think we need educated - Even though I'm a liberal arts major, I studied economics in college and continue to read how economics affects us every day. 
Gerard Zarella   After EVERY tax cut since Nixon, the economy surged and then quickly slumped. Taxes were cut on upper earners and corporations and you're right it resulted in a quick surge in the economy, and then every tax cut was followed by a recession... - Reagan/Bush recession of the late 80's that by the way, Bill Clinton brought us out of while balancing the budget, the last recession that we've still not recovered from followed the Bush tax cuts. History does not bear out your theory ********. The stimulus package did seed several companies that are now doing real hiring. You need to take a history course *******. I understand macro and micro economics - studied it in college, and [moreover], I've seen what the GAO and other economic and financial writers have written about your idea that cutting taxes and regulation stimulates growth. It is a fact of history that the economy did well during the Clinton administration when taxes where at a higher rate and that the economy tanked every time a Republican president starts giving welfare to corporations and the small percentage of people at the top of the food chain.

Gerard Zarella  http://cedarcomm.com/~stevelm1/usdebt.htm With Reagan-Bush and Bush the national debt continued to rise. Fiscal conservatives that decreased revenue and increased spending. Under Clinton the debt disappeared when he balanced the budget that we all know that Bush II utterly destroyed within several months in office. Obama now has inherited the fiscal mess that Bush left and shouldn't be blamed for doing anything more or less than both Bushes and Reagan did. Get over it ******. Republican economics did not, do not and will not work.
***** Yeah, great quote. And bogus numbers. Under Reagan, the economy didn't 'spike', unless you call 10+ years a spike. 'Quickly slumped'? Nonsense. And national debt is a separate issue from corporate and personal tax rates, much more about government spending than tax revenues.  
Why do people resort to arguing that the information is "bogus" or worse, they try to discredit the reporter with disparaging descriptions of their political philosophy when they disagree with it.  But yet, they listen to FOX, Rush and Glenn and never question a thing they have to say?  In fairness, my friend claims to watch all sources of news, but refers to anything not FOX as the "MSM" or liberal (implied) mainstream media, a way to disparage the source.
Gerard Zarella No ****** not bogus numbers - go look at the sources before you dismiss something you only took a 2 minute look at.

Gerard Zarella Corporate and personal tax rates are what pay the national debt down. WTF are you talking about.

*********  I can find numbers to support the opposite viewpoint. These numbers are slanted to support the argument, of course. Yes, tax rates pay the national debt, my point is the government should be buying less. Raising taxes isn't going to solve any problem, never has and never will. Letting working citizens keep more of their salaries will.

Gerard Zarella Find them and show me *******. 
He didn't show me any numbers - I thought teachers brought their sources with them - but I looked for something to support his case and found it here, referenced a little farther on in our exchange.  And apparently he missed the evidence I provided that both the Reagan and Bush tax cuts led to recessions, not economic booms like predicted.
Gerard Zarella Yes the government should be buying less corporate support and quit selling off the poor, underprivileged and disenfranchised.

**********  Yes, agreed. Governments historically are only good at 2 things : making war and collecting taxes. Everything else should be out of their purview, and the latter should be done as little as possible.
 That would be Republican governments.  The last few Democratic governments did as much as they could to keep us out of wars and to keep our military actions as limited as possible.  And yes, even Republican governments raise taxes, ask President Reagan and GHW "Read my lips..." Bush.
Gerard Zarella Here ******- supply side economics explaiined - the Laffer curve (an apt name by the way) http://en.wikipedia.org/wiki/Laffer_curve Even this that is supposed to support your theory, actually says that it's not really true given the infinite possibilities that can satisfy the boundaries defined [within] the curve. 
 Gerard Zarella http://www.dollarsandsense.org/archives/2011/0611reuss.html http://rricketts.ba.ttu.edu/Tax%20Rates%20and%20Revenues.htm As you can see *******, it's easier to find evidence to refute the popular belief that tax cuts increases revenue. It just isn't born out by the facts and practice.
I think our exchange speaks for itself.  I think we're still friends, though. We both live to debate another day!

Voodoo Economics - The Beginning
Picture Credit


3 comments:

  1. I would offer that no one seems to be able to predict the future. Both Keynesian and Austrian extremes (I use the word extreme knowing it may grate) can predict it; although they both offer “proof” that they can.

    No camp seems to have sufficient information to plan economic recovery. They think they do but I don’t believe it. Many of us are simply tired of failed economics being forced on all of us under rhetoric that the smart people are in office now.

    In my view, the 'correct' education has never allowed those in power to predict the actions of hundreds of millions of individuals that affect market reactions.

    ReplyDelete
  2. Thanks again KP for the comments. I think our ability to predict the future is even worse now than it ever was. The economy and government seem to be more unpredictable now than ever. There is extreme partisanship on both sides, but I maintain that when the right goes to its extreme, where we've been for the last 6 months, nothing good comes of it. Conservatives claim the left does more damage with their partisanship, but history would tend to refute that.

    My friend, who claims to be a conservative libertarian, seems to be sold on Reagonomics. He is an avowed capitalist who posits that the economy will right itself if the government gets out of the way.

    My only point is that since Nixon, we've tried that several times and every time we've ended up with some kind of knot in the economy, stock market falling, prices rising, interest rate instability, and a lot of people telling us they know how to fix it, but...

    I'm sure there is a balance somewhere in this mess, but returning to failed policies isn't the way. The point of this post was to say, like the rest of the conservative movement that believes, "we the people" need to be educated by to their ways in order to save the country. When governments start to educated us, especially when the education divides, instead of unites, us we're in trouble.

    The first thing that totalitarian governments do is to "educate" the people that the rest of the world is out to get them. I get that feeling from the Right. They seem to be wanting to pit us against each other, particularly based upon the distribution of wealth - i.e., class warfare.

    ReplyDelete

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