Do the realities of the marginal propensity to consume...

Just get a flat 18% consumption tax out there, and be done with it.

DD

 

Yes.

 

Agreed. Yes.

 

Maybe.

 

What "reality" are you referring to?

If you give people money they spend it. Whter they make $6/hour or $250k they spend it.

 

Yes it does, but that isn't the only reason it puts the Kabosh on trickle down economics. If someone makes 500K a year, whether or not they get a tax cut doesn't determine whether they have spending money or investment money. They do. Less of a tax cut won't change that.

Obviously the less a person makes the more important that tax cut is toward discretionary spending.

 

No.

 

Does this mean that people who have more money than they can spend will not spend more when given a tax break? But the president's well paid, partisan economists disagree!!! A real conundrum here.

 

I can speak for myself in that my wife and I are DIWYK's to be in the bellyhooed middle-income bracket. We just got a house as many have in 2004, and any kind of tax break or tax cut will assuredly lead to more discretionary spending...

 

Yes they do. But, it was a failure when Reagan tried it, and Bush's more aggressive appliance will only fail worse. If I have 8 million lying around and I'm not investing it, having more will not help me invest either.

 

I don't think they disagree, they can't because empirical evidence shows otherwise.

They generally finesse or avoid the argument whenever it is shown to them rather than disagree with the numbers.