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The University of Chicago surveyed 42 leading economists and found exactly one who believes the Republican claim that their tax bill will grow the economy. In the second question, they were asked If the US enacts a tax bill similar to those currently moving through the House and Senate — and assuming no other changes in tax or spending policy — the US debt-to-GDP ratio will be substantially higher a decade from now than under the status quo, none disagreed. http://www.igmchicago.org/surveys/tax-reform-2
I'm a tax attorney and for years have been pro-tax reform, but I'm not sold on this incarnation. It just adds WAY too much to the federal deficit, and I don't believe that the "dynamic scoring" is going to come to fruition. The end result is that we'll need to borrow another 1.5 trillion, and for what?
Some of the provisions are pro-business, I'll give them that. But without spending cuts, how can any entity (whether it be government, business, or even a family budget) voluntarily reduce its income? I hate taxes just as much as the next guy, but you solve that issue by addressing the SPENDING, not the taxing.
Taxes should flow from spending, and not the other way around. Want to cut taxes? Cut spending. And stop borrowing for routine annual budgets.
1. When the military gets bigger and drops more bombs, uses more fuel and pays off more people.
2. When health care costs go up completely through the roof. When vast number don't have insurance, causing high prices at the ER.
3. The Opiate Crisis - billions are already being spent and many more billions will.
4. Real Estate Bubbles and High prices - when you pay more (for less) the GDP goes up..
This is "growth" - higher prices, more suffering in many cases, etc.
With just health care and the Security State being 1/2 our economy, it's hard to argue that Growth is Good. Growth usually means more traffic, more pollution and more stress also.
Can you provide a factual rebuttal to this?
Oh, remember, much of the "Growth" is free printed money - that 1.5 Trillion of additional debt they want to create. This is like me stealing 100K from your bank account and then bragging how good things are!
There's nothing that would lead me to believe it can not be done. We have a dynamic economy that's being crushed by the weight of government just waiting to be unleashed. Hopefully it gets done.
The government is NOT stopping employers from raising wages. They keep wages where they are because they are able to get away with it.
1. When the military gets bigger and drops more bombs, uses more fuel and pays off more people.
2. When health care costs go up completely through the roof. When vast number don't have insurance, causing high prices at the ER.
3. The Opiate Crisis - billions are already being spent and many more billions will.
4. Real Estate Bubbles and High prices - when you pay more (for less) the GDP goes up..
This is "growth" - higher prices, more suffering in many cases, etc.
With just health care and the Security State being 1/2 our economy, it's hard to argue that Growth is Good. Growth usually means more traffic, more pollution and more stress also.
Can you provide a factual rebuttal to this?
Oh, remember, much of the "Growth" is free printed money - that 1.5 Trillion of additional debt they want to create. This is like me stealing 100K from your bank account and then bragging how good things are!
You can grow by providing heretofore-undersupplied health care, by converting the energy grid to cleaner power sources to reduce pollution, or by hiring more regulators to oversee banks and prevent another recession, to name a few. There are all kinds of growth that would be positive, even if none of them are related to the current proposed tax plan.
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Quote:
Originally Posted by cttransplant85
There's nothing that would lead me to believe it can not be done. We have a dynamic economy that's being crushed by the weight of government just waiting to be unleashed. Hopefully it gets done.
Not sure if you understand how business works but there is zero 'crushing' going on outside of the regulation of heavily abusive (think banks) or polluting industries (think power plants, fossil fuel extraction, etc). Economic growth, as we measure the GDP, goes up when consumers buy more stuff, government makes a major investment in public infrastructure, health care spending rises, or there is a natural disaster that must be remediated. There is a minor impact if companies invest in capital infrastructure but it is not great. Unless this tax savings goes directly into the middle classes pockets for them to spend then the economy will not grow much if any. In fact, it may recede if tax revenue drops enough that government borrows more money (because they can't seem to cut the big items in the budget) on the open market, driving up interest rates. So, I guess we'll see what happens although history will say that these kinds of cuts do nothing but enrich wealthy people like me and screw the middle class like you.
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.
I read the link, and I do not see a prediction of 5-6% long term growth.
Where did you get your number from?
You did not say over what period of time, but I guess you're talking about 5-6% annual growth.
5-6% over 10 years would be bad.
Whenever anyone talks about economic growth, they must say over what period of time.
Without a period of time the statement is meaningless.
From the article:
"If the expensing rules were made permanent, we estimate that GDP would be 3.0 percent higher than baseline under both bills. If the expensing rules were to expire, we estimate the House bill would increase GDP by 2.3 percent and the Senate bill would increase GDP by 2.6 percent"
The problem is that the playing field for effective corporate Federal income taxes isn't level. Some large corporations have bought and paid for politicians who have given them enormous loopholes so they avoid most or all of the tax. Companies with mostly US-centric business who can't hide profits offshore and who don't have the big writeoffs get slaughtered. Walmart. Verizon. Home Depot. United Technologies. They're paying big taxes. It would be much better to stop distorting the market and lower the rate while closing the loopholes. Keep it revenue-neutral. If you do that, there will be big losers. Energy companies. GE. They'll have to start paying their fair share instead of manipulating politicians to escape paying Federal corporate income taxes.
I basically agree with everything you have stated...especially the bolded part.
Woooosh.... that's the sound of my point flying over your head. I am not arguing that tax rates for US corporations are too high, too low or will or will not create jobs.
The only point I am making is that if the domestic and foreign corporate tax rates are different -- regardless of what they are -- the very existence of a differential can create an incentive for corporations to change their mix of domestic vs. overseas operations. That is all.
Sorry, my bad. Ok, I see....
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