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Old 11-21-2017, 11:08 AM
 
698 posts, read 383,163 times
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Quote:
Originally Posted by k374 View Post
Markets are up 1.5% just in the last 2 days based on tax reform... if it does not pass there will be mayhem in the markets, as Trump himself would say "believe me"!!!
Bush's "tax cuts for the rich" led to a recession, as resources were shifted away from those who spend quickly and toward those who spend slowly. What is it that they say about doing the same thing over again while expecting different results?
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Old 11-21-2017, 11:14 AM
 
8,305 posts, read 8,580,329 times
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What if we did have 5% economic growth?

It wouldn't be a good thing.

What goes up must come down. It would be a sign of the economy overheating. Five percent growth one year would likely lead to a bust followed by a recession.

I prefer an economy that grows at 2% continuously for a decade or longer than one that grows at 4% or 5% and goes into a recession after two years.
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Old 11-21-2017, 11:28 AM
 
Location: Oregon, formerly Texas
5,242 posts, read 3,395,295 times
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Quote:
Originally Posted by markg91359 View Post
What if we did have 5% economic growth?

It wouldn't be a good thing.

What goes up must come down. It would be a sign of the economy overheating. Five percent growth one year would likely lead to a bust followed by a recession.

I prefer an economy that grows at 2% continuously for a decade or longer than one that grows at 4% or 5% and goes into a recession after two years.
Precisely. Tax reform as it's currently constructed at this point would put the U.S. on a path toward another crisis.
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Old 11-21-2017, 11:29 AM
 
Location: Hartford County, CT
815 posts, read 383,928 times
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4-5% economic growth in a mature economy like ours would not be sustainable, nor would it be wise to hit those levels. This tax "reform" will probably drag down the economies of the high-income tax and high-property tax states once the people who write those off their Federal taxes no longer has the money to spend. Corporations and the rich won't go out and build factories and hire thousands of more people or raise wages because of this.
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Old 11-21-2017, 05:31 PM
 
Location: Anchorage
278 posts, read 120,735 times
Reputation: 557
Quote:
Originally Posted by FrankMiller View Post
Exactly. If you want to know how to grow the GDP, it's a question of who would spend the money they got. Corporations already have loads of cash they're sitting on, a tax cut will just get thrown on the pile. They aren't holding back for lack of funds, but lack of customers with enough money to buy more of their products.
Ding, ding, ding, winner winner chicken dinner. How many times have you heard that 70% of the US economy is consumer spending? It's not rocket science that the way to grow the economy is to get more spending money in the hands of the people - consumers - that will spend it. Slashing corporate taxes while preserving their write-offs (loop holes) while giving individuals minor tax reductions but eliminating their write-offs ain't the way to do it.
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Old 11-21-2017, 05:44 PM
DKM
 
Location: Thousand Oaks, CA
2,060 posts, read 671,463 times
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Quote:
Originally Posted by VendorDude View Post
Bush's "tax cuts for the rich" led to a recession, as resources were shifted away from those who spend quickly and toward those who spend slowly. What is it that they say about doing the same thing over again while expecting different results?
Factually incorrect. Stick with the facts please.
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Old 11-21-2017, 05:47 PM
 
33,046 posts, read 20,714,185 times
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Quote:
Originally Posted by cttransplant85 View Post
According to Heritage. I believe it; Q4 is pacing around 4% and this is before anything is done on the tax side. There are no obvious bubbles like we had in 08. This would put major upward pressure on wages. Lets hope it gets done.


How the GOP Tax Bill Will Affect the Economy | The Heritage Foundation

Won't do much for the lowest-wage workers, but it will put major upward pressure on rents - as if there weren't already enough upward pressure on rents. I don't think burger flippers can afford this tax cut.
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Old 11-21-2017, 06:02 PM
 
146 posts, read 60,529 times
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Quote:
Originally Posted by DKM View Post
Factually incorrect. Stick with the facts please.
Sounded about right to me. Greenspan promising to keep rates at 1% suggested that he was reading downside tea leaves as well.
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Old 11-21-2017, 06:04 PM
 
Location: USA
7,456 posts, read 5,444,530 times
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Quote:
Originally Posted by subaru5555 View Post
Lol...let's not pretend that Heritage isn't an ultra-biased think-tank....
Exactly. There's no magic to making the economy grow like that. And let's not forget the Housing Bubble as an example of how failed polices - like whatever tax nonsense the far-right is proposing this week - can produce fake growth. But that's exactly what the far-right loves. Again, look at the idiocy under Bush, then the economy crashes (how badly he hoped it would hold out until 2009 to blow up!), Democrats have to fix the problem, and then the far-right blames the left for their own screw-ups. It's a great system.

Mark my words, if this latest round of right-wing handouts to the rich passes, whatever "growth" you see will soon be crushed by assorted economic crisis that come out of this stupid tax plan. The far-right will do nothing about it, of course, and the left will have to clean up the mess - again - while being blamed for it by the troublemakers on the right.
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Old 11-21-2017, 08:10 PM
 
961 posts, read 921,475 times
Reputation: 1194
I think your premise is flawed from the start. 5-6% sustained cannot happen. Perhaps a blip of 4-6% is doable, but nothing about the economy will be sustained for long, and there's no way this tax reform as it stands will sustain 5-6%. Corporations will benefit the most and the GOP assumes their gains will result in business expansion, higher wages, and everything will trickle down. In my opinion, businesses are in comparative competition with each other and so accelerated revenue growth, margin expansions, and reduced input & labor costs will always be the focus. Tax cuts will not result in expansion because companies will not expand beyond the cautious demand of the consumer base. Wages could improve, but those increases will be seen at the middle to upper tiered levels and technology will continue to reduce the ranks at the bottom.

If you ask me, they really should start over. I'm really not sure how many people who support this bill are being disingenuous versus how many people really believe the pitch that they are spouting. If I could make some suggestions, I would say to focus on the middle class and focus on pathways for the lower class to attain access into the middle. I would also put conditions on the corporate tax cuts and allow companies who pledge to reinvest in American jobs to repatriate at a different rate for a set number of years. I don't understand why the GOP leaving this all up to assumptions and not getting corporations to promise on paper.
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