As spending by wealthy weakens, so does economy

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As spending by wealthy weakens, so does economy

WASHINGTON – Wealthy Americans aren't spending so freely anymore. And the rest of us are feeling the squeeze.

The question is whether the rich will cut back so much as to tip the economy back into recession — or if they will spend at least enough to sustain the recovery.

The answer may not be clear for months. But their cutbacks help explain why the rebound could be stalling. The economy grew at just a 2.4 percent rate in the April-June quarter, the government said Friday, much slower than the 3.7 percent rate for the first quarter.

Economists say overall consumer spending has slowed mainly because the richest 5 percent of Americans — those earning at least $207,000 — are buying less. They account for about 14 percent of total spending. These shoppers have retrenched as their investment values have sunk and home values have languished.

In addition, the most sweeping tax cuts in a generation are due to expire in January, and lawmakers are divided over whether the government can afford to make any of them permanent as the federal budget deficit continues to balloon. President Barack Obama wants to allow the top rates to increase next year for individuals making more than $200,000 and couples making more than $250,000. The wealthy may be keeping some money on the sidelines due to uncertainty over whether or not they will soon face higher taxes.

The Standard & Poor's 500 stock index has tumbled 9.5 percent since its high-water mark in late April. Home values fell 3.2 percent in the first quarter, according to the Standard & Poor's/Case-Shiller 20-city home price index.

Think of the wealthy as the main engine of the economy: When they buy more, the economy hums. When they cut back, it sputters. The rest of us mainly go along for the ride.

http://news.yahoo.com/s/ap/20100801/ap_on_bi_ge/us_wealthy_cut_back

explain to me again how taxing the wealthy more helps the economy....
 
Yurt said:
explain to me again how taxing the wealthy more helps the economy....
Click to expand...

Here's how. We can wait for the wealthy guy to hum and haw and finally purchase a new Jaguar with the majority of his money going overseas OR we can tax the guy and all his money will stay in the country and be spent by people requiring food, clothing, shelter, etc.

Which approach do you think will help the economy more?

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Yurt said:
As spending by wealthy weakens, so does economy

WASHINGTON – Wealthy Americans aren't spending so freely anymore. And the rest of us are feeling the squeeze.

The question is whether the rich will cut back so much as to tip the economy back into recession — or if they will spend at least enough to sustain the recovery.

The answer may not be clear for months. But their cutbacks help explain why the rebound could be stalling. The economy grew at just a 2.4 percent rate in the April-June quarter, the government said Friday, much slower than the 3.7 percent rate for the first quarter.

Economists say overall consumer spending has slowed mainly because the richest 5 percent of Americans — those earning at least $207,000 — are buying less. They account for about 14 percent of total spending. These shoppers have retrenched as their investment values have sunk and home values have languished.

In addition, the most sweeping tax cuts in a generation are due to expire in January, and lawmakers are divided over whether the government can afford to make any of them permanent as the federal budget deficit continues to balloon. President Barack Obama wants to allow the top rates to increase next year for individuals making more than $200,000 and couples making more than $250,000. The wealthy may be keeping some money on the sidelines due to uncertainty over whether or not they will soon face higher taxes.

The Standard & Poor's 500 stock index has tumbled 9.5 percent since its high-water mark in late April. Home values fell 3.2 percent in the first quarter, according to the Standard & Poor's/Case-Shiller 20-city home price index.

Think of the wealthy as the main engine of the economy: When they buy more, the economy hums. When they cut back, it sputters. The rest of us mainly go along for the ride.

http://news.yahoo.com/s/ap/20100801/ap_on_bi_ge/us_wealthy_cut_back

explain to me again how taxing the wealthy more helps the economy....
Click to expand...
 
let the wealthy buy what they want....clearly the article says that

we already tax them and feed the poor, that alone will not work, never has

unless you have some other authority....
 
apple0154 said:
Here's how. We can wait for the wealthy guy to hum and haw and finally purchase a new Jaguar with the majority of his money going overseas OR we can tax the guy and all his money will stay in the country and be spent by people requiring food, clothing, shelter, etc.

Which approach do you think will help the economy more?

//////////////////////////////////////////////////////////////////////////////////
Click to expand...


And what are you going to do, when those you want to tax decide enough's enough and leave for elsewhere??
 
Hey I'm all for letting the wealthy keeps as much of the jack they've earned, swindled and swiped. God bless them. Are you willing to cut millitary spending in half so that we can keep those tax cuts? Would you be willing to means test social security and or reduce benefits? Same with Medicare/Medicaid? Would the Republican party be willing to take responsibility for the public odium of making those decisions?

Cause if you're not. You're just blowing smoke.
 
USFREEDOM911 said:
And what are you going to do, when those you want to tax decide enough's enough and leave for elsewhere??
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Where would they go to? We have the lowest marginal tax rates for the wealthy in the industrialized world. You think they are going to some third world nation that doesn't have the infrastructure in which they can invest their capital? That doesn't have the security to protect their property? Not going to happen dude. That's an empty threat.
 
Mott the Hoople said:
Hey I'm all for letting the wealthy keeps as much of the jack they've earned, swindled and swiped. God bless them. Are you willing to cut millitary spending in half so that we can keep those tax cuts? Would you be willing to means test social security and or reduce benefits? Same with Medicare/Medicaid? Would the Republican party be willing to take responsibility for the public odium of making those decisions?

Cause if you're not. You're just blowing smoke.
Click to expand...

If that's the only way you can see this occuring, why aren't you willing to eliminate food stams, Section 8 housing, and Medicare/Medicade to the poor??

You really need to start seeing some gray.
 
Mott the Hoople said:
Where would they go to? We have the lowest marginal tax rates for the wealthy in the industrialized world. You think they are going to some third world nation that doesn't have the infrastructure in which they can invest their capital? That doesn't have the security to protect their property? Not going to happen dude. That's an empty threat.
Click to expand...

I'm sure that there's plenty of countries that would love to have the influx of wealth and would be willing to cut them slack.
 
Mott the Hoople said:
Hey I'm all for letting the wealthy keeps as much of the jack they've earned, swindled and swiped. God bless them. Are you willing to cut millitary spending in half so that we can keep those tax cuts? Would you be willing to means test social security and or reduce benefits? Same with Medicare/Medicaid? Would the Republican party be willing to take responsibility for the public odium of making those decisions?

Cause if you're not. You're just blowing smoke.
Click to expand...

this is why i laugh at jpp awards....you're one of the worst debaters here

yeah....all wealthy people swindle AND swipe their money

you're blowing nothing but hot air
 
AssHatZombie said:
Im not sure pleasing fascists should be the litmus test for good governance.
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Then why are you promoting it?

This also seems to suggest that the only countries they could relocate to, are those ruled by facists.
Faced with staying here and losing most of what they have strived for, or taking chances elsewhere.
You're the one that is promoting creating a situation that might just turn out to be not what you expected.
 
USFREEDOM911 said:
Faced with staying here and losing most of what they have strived for, or taking chances elsewhere.
Click to expand...
That's a sentence fragment. What are you saying here?

You're the one that is promoting creating a situation that might just turn out to be not what you expected.
Click to expand...

I always tailor my promotions with my expected situations guaranteed. doy.
 
AssHatZombie said:
That's a sentence fragment. What are you saying here?



I always tailor my promotions with my expected situations guaranteed. doy.
Click to expand...


Some possible options.

Some people would choose to give away what they have, as opposed to being forced to turn the same amount over.
 
USFREEDOM911 said:
If that's the only way you can see this occuring, why aren't you willing to eliminate food stams, Section 8 housing, and Medicare/Medicade to the poor??

You really need to start seeing some gray.
Click to expand...
You could eliminate those and wouldn't even scratch the surface. If you're going to address our budget deficit with out raising taxes you will have to be willing to cut millitary spending and cut benefits, i.e. spending, on social security and medicare/medicaid. If you're not willing to touch one of those golden rails you're blowing smoke.
 
So the big news here is that the rich are people too and spend less money when the economy isn't strong. I'm overwhelmed. Truly.
 
Mott the Hoople said:
You could eliminate those and wouldn't even scratch the surface. If you're going to address our budget deficit with out raising taxes you will have to be willing to cut millitary spending and cut benefits, i.e. spending, on social security and medicare/medicaid. If you're not willing to touch one of those golden rails you're blowing smoke.
Click to expand...

Well, we could stop giving aid to 90% of the countries we send it to.
That would be a big gain.
 
Yurt said:
this is why i laugh at jpp awards....you're one of the worst debaters here

yeah....all wealthy people swindle AND swipe their money

you're blowing nothing but hot air
Click to expand...
...and you're showing why you're one of the worst. When presented with hard facts you try to change the subject and avoid answering the question(s) you've been asked.

Which of the golden rails of politics are you willing to cut spending on and are you and your party willing to take that political price? Please try to answer that question instead of running away from it like you usually do.

My guess is your not going to answer that question cause you're not going to want to take that political hit.

Well that's the boat were in. We either reduce spending on those three programs to within in our current means or we raise taxes to pay for them. The choice is yours. Which one do you pick?
 
USFREEDOM911 said:
Well, we could stop giving aid to 90% of the countries we send it to.
That would be a big gain.
Click to expand...
Dude you could cut all of environmental spending, farm subsidies and foreign aid out of the discretionary budget spending all together and you're only talking about 3% of the Federal budget. That's chump change and doesn't even begin to address the problem. You need to get serious if you want balance our budget.
 
Yurt said:
let the wealthy buy what they want....clearly the article says that

we already tax them and feed the poor, that alone will not work, never has

unless you have some other authority....
Click to expand...

When have WE tried that? Yes, other peoples and other countries have tried but when have WE?
 
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