just curious...how does a $350 billion dollar tax cut even matter siginificantly in a rise of tens of trillions of dollars in debt?
Agreed. But even based on my limited understanding of economics, the administration does contribute to the problem. Remember, a crappy economy is one of the big things that got W's daddy ousted from the White House. They don't have to contribute directly for people to percieve that he has something to do with it, and perception is everything.
But Bush told us that his first round of tax cuts were going to provide a big stimulus to the economy. Investments and employment were all supposed to go up with those first tax cuts. So since they apparently had no positive effect on the enomy once we get more of them again? I'm not even going to go into the blame game, but as far as sollutions go, huge tax cuts that affect primarily the top wage earners don't seem to be working. I'd like to see a new plan proposed.
I think Bush was certainly BSing and obviously trying to get more votes in the next election by saying this tax cut would be a quick economic stimulus. However, I do really believe that cutting the dividend tax and capital gains tax will prove to be a huge benefit to the economy a few years down the road, especially to baby boomers who have money in the market and who might be living off of dividends. Also, all tax cuts effect the top wage earners the most since they pay the most in taxes. It's kind of unavoidable. You can't reduce the taxes of someone who isn't being taxed. I dunno...thats something that always bothers me when people make the arguments about tax cuts only being for the rich.
While his tax cuts will have an effect robbie, their effects will be long term, while most people seem to thing that a short term stimulus is necessary. Nobody argues with the fact that top earners pay more in taxes, and that a tax cuts in general make them save more, but Robbie it is the degree to which Bush's plan disproportionately cuts their taxes, for no valid economic purpose, that people are upset about. Many economists that criticize Bush' s plan advocate a federal payroll tax holiday rather than tax cuts for the super rich; this has two benefits: 1. the tax savings would NOT be concentrated at the top levels at anywhere near the degree of Bush's tax cuts,and 2. Since people in the lower income brackets are more likely than people in higher ones to spend the money they save by tax cuts, it would provide a greater economic stimulus, which is the whole point of a tax cut in the first place.
Arguably the best thing Bush could have done was to leave the economy alone. Quitye frequently in our history, governemental responses to an economic downturn have made the problem worse. The fly in the ointment is that if nothing is done, the public claims that the leaders don't care. So the governement enacts measures to combat the recession....and it gets worse. This is the same for ANY leader...regardless of party.
