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[QUOTE=squealpiggy;4832735]
You are correct in saying cutting tax rates will not encourage people to buy American, but it does encourage people to buy. It also assuages the wealthy, whose spending powers the economy. Cutting taxes won't have an impact next week, but it does impact psyche. Obama is upping the top tax bracket from 35 to 40 percent, and the one below it from 33 to 36 percent. He proposes slashing the deduction on charitable contributions from 35 cents on the dollar to 28 cents per dollar. He is increasing payroll taxes. The top 1% will see their taxes increase by almost 20 percent(I can break this down).
This is a personal paradox for me. I don't like blatant materialism or the culture/opulent lifestyle of the rich. However, I realize the macro-economic necessity of this group. They provide the majority of tax revenue, and that trumps my own disdain for the way many of them live their lives. Adding to that, some wealthy people are philanthropists who do a lot of good with their money.
My main point is, how do you think this group of people will react to having their taxes raised tremendously in a beyond ****ty economy? Do you think it encourages them to invest and spend?
It depends how you slash it. The 400 dollar tax kickback for "working class" people that will be received in April is quite similar to the 600 dollar Bush stimulus check from last year. There was no salient effect from the latter.
The US war effort will go on regardless. Since Obama is pulling all troops out of Iraq by 2011, one would assume that the money needed for war efforts will decrease. I believe he will cut the military budget as well.
I won't get tit for tat here, but filtering money through a giant albatross is not always efficient. Most of this bill went to refill/expand the coffers of existing government programs. Every once of welfare reform achieved in 1996 under Clinton is reversed. States will now have an incentive to take on more caseloads, because there is a direct correlation between the amount of people on welfare and amount of funding a state gets. 46 billion of the bill is noted for infrastructure, this is what I think you mean by "public works" spending, but that definition is so vague that you could mean the entire 792 billion dollar bill.
The issue of bailing out banks is tricky. If you let them fail, other banks would suck them up. The idea of the initial bank bailout under Bush was so that we would not have a credit crisis during a recession. I know there is lots of talk of "nationalizing" banks. The administration has been using different terms to avoid frightening an American public who has an inherit fear of this.
GM and Chrysler need to go Chapter 11. They are already asking for more funds than what they received from a departing president Bush. The notion that the American Auto Industry will just up and vanish is rubbish. What will happen is the union contracts will be broken, and the revamped company will hire back the old/new workers under more reasonable terms. Let's not forget that Japanese and German companies have stayed afloat in the same market, and Ford has not taken/asked for bailout money.
There is 46 billion dollars alloted for infrastructure in the stimulus bill, around 4 percent of the entire bill.
Most everyone agrees that universal insurance is needed. The majority still do not want a government run system. Besides the ethical issue of universal care, it drives up costs to have uninsured people flooding the E.R. They could be taking ideas from both sides of the isle. Legislation should be passed capping medical malpractice lawsuits, allowing businesses to pool their money together to lessen costs, eliminate laws which bar interstate purchases when there is a price difference in treatement. The goverment could also step in and force private insurers to open coverage to the poor.
Obama is pledging 634 billion dollars over ten years to fund medicaid. If we are going to spend this type of money, make sure the program is efficient and works.
People still are not spending. Cutting tax rates isn't going to make the public buy American. It isn't going to save peoples' houses. It isn't going to stop the slide.
This is a personal paradox for me. I don't like blatant materialism or the culture/opulent lifestyle of the rich. However, I realize the macro-economic necessity of this group. They provide the majority of tax revenue, and that trumps my own disdain for the way many of them live their lives. Adding to that, some wealthy people are philanthropists who do a lot of good with their money.
My main point is, how do you think this group of people will react to having their taxes raised tremendously in a beyond ****ty economy? Do you think it encourages them to invest and spend?
Besides which, if you slash the tax rate what happens to the existing deficit? What happens to the US war effort?
The US war effort will go on regardless. Since Obama is pulling all troops out of Iraq by 2011, one would assume that the money needed for war efforts will decrease. I believe he will cut the military budget as well.
The best form of stimulus at this point in time is engaging in overdue public works type spending. It needs to create jobs and get the economy moving.
The banks need protecting. The auto industry is difficult because it is part of so many adjacent industries so there's an argument to be made for keeping it ticking along, though that makes me very uncomfortable.
GM and Chrysler need to go Chapter 11. They are already asking for more funds than what they received from a departing president Bush. The notion that the American Auto Industry will just up and vanish is rubbish. What will happen is the union contracts will be broken, and the revamped company will hire back the old/new workers under more reasonable terms. Let's not forget that Japanese and German companies have stayed afloat in the same market, and Ford has not taken/asked for bailout money.
Beyond that I would suggest that building transit systems and new roadways as well as repairing the the things you already have will create skilled jobs paying well and will also be of benefit in the long run.
Expanding public healthcare will also create jobs and be of long term benefit.
Obama is pledging 634 billion dollars over ten years to fund medicaid. If we are going to spend this type of money, make sure the program is efficient and works.
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