Everybody, at least those misinformed, think tax cuts are good, tax cuts help the economy, more money in the hands of the people who are going to create jobs. That couldn't be further from the truth. Tax cuts create something called "bubble growth" in which the economy fluctuates between job creation and job loss, as opposed to "steady growth" where the job market continues to grow. Bubble growth does not help the current state of the economy, but rather keeps it as it is, if it doesn't make it worse. Thom Hartmann recently stated that if Ronald Regan's tax cuts were never put into place, the people of the United States would be living a life of luxury right now.
That's fine and dandy, but why exactly do increased taxes help the economy? Well, let me explain:
Higher taxes help stimulate the economy simply because they dictate to the "job creators", the people higher up in corporations, to leave more money in the business rather than take it out of the business. This means more money for the business, more money for jobs, more money for the people that spend money. In addition to this, higher taxes also means more money for the government to use on public services that help people, such as the post office, public schools, emergency services, etc.
Tax cuts on the other hand tell these higher-ups that it's ok to take money out of the business and put it in their own pocket, leaving less money in the business, less money in the pockets of the people who are going to spend it, less money circulating in the economy.
Well that's great and all, but how do we make sure those "job creators" use that money to create jobs in the US rather than overseas?
Well, that's pretty simple really, increase tariffs on goods received from other countries, simply make it more expensive for these corporations to manufacture overseas than it is to manufacture in the US. These tariffs were once in place, but at some point, the US government decided to lower them, thinking it would stimulate the world economy. Well, it didn't do what they intended it to do, but rather it created an environment where large companies could swoop in and create something akin to slave labor in other countries.
The economy could be alot worse off, even from what it is right now, but if the Bush/Regan tax cuts were rolled back, it would be about a hundred times better than what it is right now.
So Scream Fascism to those who want to lower taxes!
--Matt Schultz
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