the Right is going to complain about the one measure that is going to help pay down the deficit? That's pretty telling.
80 billion dollars hardly does anything to help the debt Kevin. I know you don't agree but IMHO spending is still out of control.
Kevin did say deficit, and 80 billion is relevant to that -- i'm assuming that's the correct figure as I don't really follow the news.
Since medotorg brought up Adam Smith, I'll bring up Milton Friedman.
The most extreme right-wing tax idea says that we must cut the taxes of the rich so they can create jobs, expand economic growth, and thus greater tax revenue will be earned as a smaller slice of a larger economy.
Less extreme is the idea that tax cuts across the board will generate the smaller slice of a bigger economy effect.
Friedman rejected both ideas, though, I'll have to look for a quote later. This is not free-market economics, but right-wing protecting their own interests through intervention economics.
Well, here's something to think about:
Assume that Keynes was wrong and the economy does not get stuck below "full employment" with a need for fiscal policy and "job creation" by the government to fix the problem. Assume Friedman's theory of crowding out is right, that fiscal spending might create jobs, but raises interest rates enough to crowd out private spending, thus subtracting the same amount of jobs in return and leaving the economy with no benefit.
So we're assuming Friedman is right and crowding out happens. A politician decides to cut taxes and reduce fiscal spending. What is the effect? The effect is that fewer government jobs are created, interests rates lower, and the private sector fills in the gaps with enough jobs to offset the loss on the government side. But the economy is not expanded. To believe the economy is expanded this way implies that there are market failures where labor is not at full output, and through stimulus via a "tax cut", full output can be restored. In other words, trickle-down tax cuts and tax cutting to "stimulate growth" are round about ways of believing in Keynes.
But trickle-down tax cutting in particular is really bad to believe in for someone who says God is a free-market capitalist.
Imagine succession and the resulting economy one that is a happy tea-party fest with no taxes. Hmm. If a regressive tax will stimulate the economy in a world with taxes, by disproportionally putting wealth in the hands of the "job-creating" rich, is there a way to translate the core principle at work here into the tea-party Utopia in order to make the Lord's chosen even richer? Why yes there is. Take money from the lower class and give it to the rich, who will invest in holier and holier capital, thus providing more and better jobs for the lower class and an even bigger pie for everyone. We won't call this wealth transfer a tax and we won't call the rich in this scenario central planners who can make capital allocations better than the market, and we won't say the economy pre-wealth transfer was stuck below full employment. hehe. But boy, will Droopy and BCSpace be surprised when the Lord comes down from the sky with his full anger on display to weed them out for being practicing Leftists and subscribers to the false doctrines of Keynes.