Do tax cuts create jobs?

[zappasguitar]

We had a booming economy, a budget surplus and lots of jobs, then Bush cut taxes.


The Bush tax cuts are still in place.

• Now we have a faltering economy, high unemployment and a deficit.

The Bush tax cuts are still in place.

• The deficit is growing.

The Bush tax cuts are still in place.

• Unemployment is growing.

If tax cuts create jobs, where are the jobs the tax cuts created?

Not a one of them has anything other than their snarky non-response they keep standing by for when they don't have an answer.

 

[Damocles]

Clinton was smart enough to raise taxes into an expanding economy rather than a flatline or shrinking economy. It is fundamentally stupid to raise taxes into a recession. Jeebus, the whole reason for overspending in Keynesian theory is because he assumes nobody would be that stupid. It states that because we cannot raise taxes we need to deficit spend on infrastructure (the problem here is modern idiots never read that word "infrastructure") to forestall and hopefully overcome the downtrend.

There was a small dip in growth after Clinton's tax increase, but the wave we were riding at that time overcame the minute deceleration of the growth, Clinton raised taxes into a rapidly expanding economy that is the time to do it if you are going to. Bush faced 9/11 which was a direct attack on our economic foundation, that he was able to stave off the more serious recession for so long is actually quite amazing, but the piper will be paid, every time.

 

[Bonestorm]

Clinton was smart enough to raise taxes into an expanding economy rather than a flatline or shrinking economy. It is fundamentally stupid to raise taxes into a recession. Jeebus, the whole reason for overspending in Keynesian theory is because he assumes nobody would be that stupid. It states that because we cannot raise taxes we need to deficit spend on infrastructure (the problem here is modern idiots never read that word "infrastructure") to forestall and hopefully overcome the downtrend.

First, no one would be talking bout raising taxes in the absence of the deficit hysteria horseshit. Second, "infrastructure" spending is not a necessary part of Keynesian theory. It's just a smart way to spend money.

There was a small dip in growth after Clinton's tax increase, but the wave we were riding at that time overcame the minute deceleration of the growth, Clinton raised taxes into a rapidly expanding economy that is the time to do it if you are going to. Bush faced 9/11 which was a direct attack on our economic foundation, that he was able to stave off the more serious recession for so long is actually quite amazing, but the piper will be paid, every time.

Can you show me where the dip is? I'm not seeing it:

 

[Guns Guns Guns]

Clinton was smart enough to raise taxes into an expanding economy rather than a flatline or shrinking economy. It is fundamentally stupid to raise taxes into a recession. Jeebus, the whole reason for overspending in Keynesian theory is because he assumes nobody would be that stupid. It states that because we cannot raise taxes we need to deficit spend on infrastructure (the problem here is modern idiots never read that word "infrastructure") to forestall and hopefully overcome the downtrend. There was a small dip in growth after Clinton's tax increase, but the wave we were riding at that time overcame the minute deceleration of the growth, Clinton raised taxes into a rapidly expanding economy that is the time to do it if you are going to. Bush faced 9/11 which was a direct attack on our economic foundation, that he was able to stave off the more serious recession for so long is actually quite amazing, but the piper will be paid, every time.

Bush faced 9/11?

That was 10 years ago. Txes haven't gone up since, have they? Where are the jobs?

 

[Damocles]

First, no one would be talking bout raising taxes in the absence of the deficit hysteria horseshit. Second, "infrastructure" spending is not a necessary part of Keynesian theory. It's just a smart way to spend money.




Can you show me where the dip is? I'm not seeing it:

Ahh. I should have used slight decrease in growth, I can see what you are saying. Growth was at a higher rate in the months previous to the increase, it slowed slightly then returned to the rapid growth rate we saw previously. And it was slight. As I said, if you are going to increase taxes it should be done into growth, not into flatline or into negative growth. There is a reason that Clinton believes this tax hike is a bad idea, and unsurprisingly I agree with him. Anyway, in your chart it is represented in the slight turn to the right the chart makes in 1993 until about the end of the year, where the economic growth increased...

Secondly, Keynes theory says you should spend on infrastructure, that you keep repeating that it doesn't won't change that.

Contrary to some critical characterizations of it, Keynesianism does not consist solely of deficit spending. Keynesianism recommends counter-cyclical policies.[17] An example of a counter-cyclical policy is raising taxes to cool the economy and to prevent inflation when there is abundant demand-side growth, and engaging in deficit spending on labor-intensive infrastructure projects to stimulate employment and stabilize wages during economic downturns. Classical economics, on the other hand, argues that one should cut taxes when there are budget surpluses, and cut spending—or, less likely, increase taxes—during economic downturns. Keynesian economists believe that adding to profits and incomes during boom cycles through tax cuts, and removing income and profits from the economy through cuts in spending and/or increased taxes during downturns, tends to exacerbate the negative effects of the business cycle. This effect is especially pronounced when the government controls a large fraction of the economy, and is therefore one reason fiscal conservatives advocate a much smaller government.

Note how Clinton followed this. Tax into growth. Also note how the deficit spending should be done in a counter-cyclical policy.. On infrastructure....

http://en.wikipedia.org/wiki/Keynesian_economics

Bush desperately tried to use the tax cuts to deter the negative effects of 9/11, but was unable to hold them off for his full term. My guess is the Administration thought they could hold them off until the next administration who would then hold the "blame"... But they were unable to hold them off for the whole of the second term.

I still remember when it was the "worst economy for jobs since the great depression" when Bush had 6.5% unemployment...

 

[Bonestorm]

Ahh. I should have used slight decrease in growth, I can see what you are saying. Growth was at a higher rate in the months previous to the increase, it slowed slightly then returned to the rapid growth rate we saw previously. And it was slight. As I said, if you are going to increase taxes it should be done into growth, not into flatline or into negative growth. There is a reason that Clinton believes this tax hike is a bad idea, and unsurprisingly I agree with him. Anyway, in your chart it is represented in the slight turn to the right the chart makes in 1993 until about the end of the year, where the economic growth increased...

Here's a closer look at the 1993 -1995 period. Can you show me again where the slowed growth is following the Clinton tax increases? Keep in mind that they were passed in September 1993:

Secondly, Keynes theory says you should spend on infrastructure, that you keep repeating that it doesn't won't change that.


Note how Clinton followed this. Tax into growth. Also note how the deficit spending should be done in a counter-cyclical policy.. On infrastructure....

http://en.wikipedia.org/wiki/Keynesian_economics

Um, the portion you quoted doesn't support your claim, nor does the linked referenced (which is an interview of Larry Summers by Ezra Klein). Infrastructure spending is just a good way for the government to spend money, but it isn't the only way. The classic example is WWII spending. That wasn't infrastructure spending. It was basically spending money to destroy shit but it worked to finally pull the country out of the Great Depression. Paul Krugman sarcastically writes about pretending we are at war with aliens and spending shit loads of money to get the economy going. He knows a thing or two more about Keynesian theory than you.

Bush desperately tried to use the tax cuts to deter the negative effects of 9/11, but was unable to hold them off for his full term. My guess is the Administration thought they could hold them off until the next administration who would then hold the "blame"... But they were unable to hold them off for the whole of the second term.

Bush's tax cuts were the policy regardless of the economic facts. They had nothing to do with 9/11. Unless Bush was some sort of Pre-cog. The 2001 tax cuts were passed in May 2001.

I still remember when it was the "worst economy for jobs since the great depression" when Bush had 6.5% unemployment...

I don't remember that. But, I remember Bush was on track to be the first president since Herbert Hoover to have net job losses over his first term.

 

[Cancel 2018. 3]

Here's a closer look at the 1993 -1995 period. Can you show me again where the slowed growth is following the Clinton tax increases? Keep in mind that they were passed in September 1993:

Um, the portion you quoted doesn't support your claim, nor does the linked referenced (which is an interview of Larry Summers by Ezra Klein). Infrastructure spending is just a good way for the government to spend money, but it isn't the only way. The classic example is WWII spending. That wasn't infrastructure spending. It was basically spending money to destroy shit but it worked to finally pull the country out of the Great Depression. Paul Krugman sarcastically writes about pretending we are at war with aliens and spending shit loads of money to get the economy going. He knows a thing or two more about Keynesian theory than you.





Bush's tax cuts were the policy regardless of the economic facts. They had nothing to do with 9/11. Unless Bush was some sort of Pre-cog. The 2001 tax cuts were passed in May 2001.



I don't remember that. But, I remember Bush was on track to be the first president since Herbert Hoover to have net job losses over his first term.

did 9/11 have anything to do with job losses?

 

[Damocles]

Here's a closer look at the 1993 -1995 period. Can you show me again where the slowed growth is following the Clinton tax increases? Keep in mind that they were passed in September 1993:

Again, you can see as it takes a right turn then sharply back up as the tax went into effect in 1993. It's not that difficult. (Again I said it was "slight" and that it wasn't a "dip" I used words a bit lazily there. I corrected. Your chart shows what I am saying. In the first one it was difficult to see the quarters like you could in this one. You should include the previous quarter.

Um, the portion you quoted doesn't support your claim, nor does the linked referenced (which is an interview of Larry Summers by Ezra Klein). Infrastructure spending is just a good way for the government to spend money, but it isn't the only way. The classic example is WWII spending. That wasn't infrastructure spending. It was basically spending money to destroy shit but it worked to finally pull the country out of the Great Depression. Paul Krugman sarcastically writes about pretending we are at war with aliens and spending shit loads of money to get the economy going. He knows a thing or two more about Keynesian theory than you.

Um... Yes. It does. I even bolded the important bit for you. It's not that hard to read "infrastructure", it was even spelled the same in ancient 20th century American English. (Note for the eternally sarcastically limited left, this is sarcasm. You have to be obvious with that, it really isn't in "ancient" American English...)

Bush's tax cuts were the policy regardless of the economic facts. They had nothing to do with 9/11. Unless Bush was some sort of Pre-cog. The 2001 tax cuts were passed in May 2001.



I don't remember that. But, I remember Bush was on track to be the first president since Herbert Hoover to have net job losses over his first term.

I remember it. And it wasn't really precog, but really more of a "wow, just in time" kind of thing. With that and the "go shopping" with an easing of credit he sped up the fall that came with the credit crisis, but was able to push it off for a bit as we were spending, and much of our economy is consumption. Anyway the credit crisis, you know, the one that has been expanded with Obama's policy, has been extended due to misapplication of Keynes' theory and an idiotic assumption that you can spend on "anything"... It isn't what the theory says.

The problem is trying to misapply Keynes' theories after we have overspent for 50 years without regard to the other portion of the theory (paying it down so we could afford the overspending during the downturns) is causing more than a hiccough...

 

[Bonestorm]

Again, you can see as it takes a right turn then sharply back up as the tax went into effect in 1993. It's not that difficult. (Again I said it was "slight" and that it wasn't a "dip" I used words a bit lazily there. I corrected. Your chart shows what I am saying. In the first one it was difficult to see the quarters like you could in this one. You should include the previous quarter.

The chart I have there shows all of 1993 and all of 1994. The tax increases were enacted in September 1993. The rate of growth increased immediately thereafer.

Um... Yes. It does. I even bolded the important bit for you. It's not that hard to read "infrastructure", it was even spelled the same in ancient 20th century American English. (Note for the eternally sarcastically limited left, this is sarcasm. You have to be obvious with that, it really isn't in "ancient" American English...)

I love it when you get all condescending while you are completely wrong. It cracks me up.

I remember it. And it wasn't really precog, but really more of a "wow, just in time" kind of thing. With that and the "go shopping" with an easing of credit he sped up the fall that came with the credit crisis, but was able to push it off for a bit as we were spending, and much of our economy is consumption. Anyway the credit crisis, you know, the one that has been expanded with Obama's policy, has been extended due to misapplication of Keynes' theory and an idiotic assumption that you can spend on "anything"... It isn't what the theory says.

Dude, the tax cuts were passed in May 2001. They had nothing to do with 9/11. Just say you misremembered. It's not that difficult.

The problem is trying to misapply Keynes' theories after we have overspent for 50 years without regard to the other portion of the theory (paying it down so we could afford the overspending during the downturns) is causing more than a hiccough...

Whatever. You're really good at pretending you know what in the hell you are talking about.

 

[Damocles]

The chart I have there shows all of 1993 and all of 1994. The tax increases were enacted in September 1993. The rate of growth increased immediately thereafer.

No, it turns right slightly then returns to the rapid growth rate. I can see it there. In actual numbers it went from 2.6% to 2.1% growth... then back up... (I did say it was slight).

I love it when you get all condescending while you are completely wrong. It cracks me up.

I love how you have zero evidence that I am wrong other than your insistence that I am while I was able to link up to the theory and bold the portions that were salient for you.

Dude, the tax cuts were passed in May 2001. They had nothing to do with 9/11. Just say you misremembered. It's not that difficult.

I didn't though. I was imprecise. I'm good with that. It's too late to fix it...

Basically what I was trying to say is that the tax cuts coupled with the "go out and shop" with easy credit was able to temporarily stave off the full effect of the downturn that came from 9/11.

Whatever. You're really good at pretending you know what in the hell you are talking about.

Right, and you are incapable of actually reading a paragraph that says exactly what I said, and just admitting you were flat wrong. Keynes' theory most definitely spoke of spending on infrastructure... Then incapable of taking your old econ classes and applying it just like your professor asked you to back in the day. I'm good with that. I am sorry I was imprecise with Bush's cuts, however my meaning is sound. The cuts helped in just the right time to help push out the full negative effect of 9/11 on the economy. Other policies exaggerated those effects by adding to the credit crisis (not the tax cuts here, the "cheap and easy credit" policies). I believe that the attempt was to "punt" the problem into the next Administration. Which would have worked if he had been a one-termer, and almost worked even though he was a two-termer. I believe that he didn't expect to win a second term.

 

[signalmankenneth]

No they do not!

 

[Guns Guns Guns]

 

[Bonestorm]

Here's Dean Baker:

We know how to get out of this mess, we have known how for 70 years. We just need the government to generate demand. That means spending money. Ideally it would spend money on useful things like education, health care, and infrastructure, but even if it spent money in wasteful ways it would still create jobs and put people to work.

In the 30s we got much of the way back to full employment with the Works Progress Administration and other programs. Much of what was done was useful -- look around, you won't have to go far to find infrastructure built by depression-era programs. However, it took the massive spending associated with World War II to get the economy back to full employment. There is no magic associated with war that makes military spending more effective in creating jobs. The only difference was that the threat to the nation from the Axis powers removed the political obstacles to the necessary spending.

The same situation applies today. We just need to spend money. That applies to both the United States and the euro zone countries. The problem is that we have more people in political leadership positions who want to be morality cops and lecture about balancing budgets rather than focus on policies that will restore economic growth. This includes the top officials at the European Central Bank, many of the voting members of the Federal Reserve Board's Open Market Committee and much of the political leadership in the euro zone countries, the United Kingdom and of course here.

Like I said, infrastructure is a good way to spend money because it is useful, but it isn't necessary under Keynesian theory.


http://www.cepr.net/index.php/blogs...ampaign=Feed:+beat_the_press+(Beat+the+Press)

 

[Guns Guns Guns]

Here's Dean Baker: Like I said, infrastructure is a good way to spend money because it is useful, but it isn't necessary under Keynesian theory. http://www.cepr.net/index.php/blogs/beat-the-press/robert-samuelson-is-half-right-china-could-save-the-world?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+beat_the_press+(Beat+the+Press)

Why don't any of the 'slash spending and taxes' crowd seem to realize that governments are the largest customers of many enterprises?

 

[Damocles]

Here's Dean Baker:




Like I said, infrastructure is a good way to spend money because it is useful, but it isn't necessary under Keynesian theory.


http://www.cepr.net/index.php/blogs...ampaign=Feed:+beat_the_press+(Beat+the+Press)

This first assumes that military infrastructure is somehow not infrastructure. Secondly it actually ignores the portion of the theory that I posted. That others deploy the theory incorrectly doesn't change the actual theory.

Buy "things", because what we make matters. Spending on research is not infrastructure, tanks is. So long as we make them here it will benefit us in the end.

 

[Bonestorm]

This first assumes that military infrastructure is somehow not infrastructure. Secondly it actually ignores the portion of the theory that I posted. That others deploy the theory incorrectly doesn't change the actual theory.

Buy "things", because what we make matters. Spending on research is not infrastructure, tanks is. So long as we make them here it will benefit us in the end.

OK. You know more about Keynesian economics than Keynesian economists. Got it.

 

[Cancel 2018. 3]

yes, tax cuts create jobs.

that is all.