DISQUS

caphillprof · 11 months ago

It's a depression, not a recession. At present, the economy is not fundamentally sound. People are hoarding and not spending, Business are getting smaller, closing divisions, laying off workers. Local governments are going out of their way to make things even worse, they are reducing forces, stopping services, backing off capital investments. Banks have plenty of money and they are sitting on it, not lending it.

Under these circumstances, tax cuts are ineffective, The recipients either use it to reduce their debt or it is so small and comes in such dribs and drabs that it really isn't seen.

What is effective is government taking money, begged, borrowed or stolen, and invests it in productivity. Only productivity can regrow the economy.

In lieu of tax cuts, there should be debit cards, good only for goods and services in the US, not good for existing debt, use it within 90 days or lose it, it's worthless. That also would boost the economy.

Steve_in_CNJ · 11 months ago

maybe the government could take bids from retail stores to provide gift certificates in lieu of tax cuts.

renegademom · 11 months ago

I am SO not an economist, but it seems to me that the $800 billion number has to get bigger, no? I am borderline working/middle class, single mom with three kids, and even $20 more per paycheck would help me. It would pay for my kids school lunches. So, is the end game to make the total figure grow so adequate spending AND an immediate tax cut could both happen?

p.s. I'm spending what I can, doing my part as a citizen.......clothes for kids, art supplies......it doesn't have to be garbaaage........spend to enrich.

onceler · 11 months ago

hmm, it was my understanding that their rationale was that there aren't enough 'ready-to-go' infrastructure and spending projects to actually receive a trillion dollar infusion in a way that would be effective, so the leftover $$ went into tax cuts. the problem is that they're just way underestimating what they could spend and on what, and then tax cuts become an easy placeholder which keeps Republicans quiet in the mean time.

I think personally the tax issue and the stimulus issue should remain as separate as possible. repeal the Bush tax cuts, and give the middle class relief, as Obama proposed to do. MORE than pays for itself. spend the stimulus money on massive infrastructure projects, school rebuilding, levees in New Orleans which would actually work against another Katrina, tons and tons and tons of green energy projects, national power distribution & storage improvements, environmental cleanup, putting more teachers to work. right now we have hundreds of thousands of empty houses worth half of what they used to be worth. those properties will continue to decline in value as they lay fallow and fall into disrepair. since the holders of the mortgages are being bailed out with our tax $, it makes sense for the government to employ people specifically to maintain the value of these properties - ie quantify their locations and monitor their status until sold.

tax cuts as stimulus doesn't work, few economists disagree about this, not sure why Obama would cling to them over better ideas. hopefully he won't, and is just setting up the Repugs so that they're on board until the last minute when the tax cuts dwindle as a percentage of the plan, forcing the 'pugs to either vote with him or greatly disappoint their constituents by voting 'no', which would be fine.

Lib4Life · 11 months ago

Obviously, Obama's lying again.

onceler · 11 months ago

well I wouldn't go that far, I just think he chose very un-exceptional, conventional-wisdom obsessed beltway retreads for economic advisers, and that this will prove to be a crucial mistake if he f's up this recovery package. if he does this wrong, he will be a 1 term pres.

Akaison · 11 months ago

I said the same thing. He needs to think boldly for his own sake , not ours.

Older_Wiser · 11 months ago

I'm against tax cuts. Leave all the money in infrastructure and put some incentives in it to include new hiring, esp among minorities, training, benefits, such as decent medical insurance, etc. Don't let this thing become as wasteful as the privatization schemes cooked up in Bush's wars.

If I were out of work, I'd much rather have a job than a crummy little tax cut, although to help those below the average wage in the US, it might help to raise the limit on the earned income credit (something already proposed), which would help the lower 50% of wage earners; after all, there is simply no comparison between a family struggling on, say $40K a year and a single person with a higher income closing on six figures. That would help more people than you might think, esp. in this era of high unemployment--even some of those making good salaries, if unemployed for a period of time, could take advantage of that kind of tax cut.

With unemployment at a 6.6% rate for whites and 11.9% for blacks (official figures, which I don't trust), with Hispanics not far behind them, we know who is suffering the most through this horrible time. And inflation has also eroded the buying power of those at the bottom 50% as well, particularly in housing, food, energy and medical coverage areas--you know, the stuff of life.

My adult son and I live OK right now, but if he lost his job, there would be no way I could keep this place up on a SS payment. We would be wiped out in a matter of a few months unless he could find employment. And we don't even owe anything except his mortgage and monthly expenses. But there is little disposable income left.

Jobs, people, jobs. At least that's what people in this area need--and lots of them, along with training for the future.

And cut out tax cuts for the wealthy, esp. since there are absolutely no incentives for them to create jobs. In fact, there are no restrictions on those tax cuts whatsoever. I'm tired of the wealthy just lining their own pockets; we see what that's accomplished in the last 8 years.

Dianne_in_DC · 11 months ago

I so agree with you about tax cuts vs. job. I got my "stimulus" check while I was unemployed. It went to pay my mortgage.

Dianne_in_DC · 11 months ago

Yes, but the tax cuts did not result in less government spending. We are spending all the money on Iraq. That does not benefit anyone here. Perhaps it benefits the GI's etc but they are all Over There. We need government spending here in the US to knock this thing out.

James K. Sayre · 11 months ago

Hmm, did FDR lobby for tax cuts in the middle of the Republican-created depression in the 1930s? I don't think so. The unemployed don't pay many taxes, since they don't have any money to spend. Obama needs to create a modern version of the WPA, and create millions of American jobs rebuilding our failing infrastructure (bridges, roads, highways, schools, ports, hospitals, parks). Using American-made steel and American-made cement.

Tax cuts help destroy America, by giving the wealthy more money, and hence more financial power to control the elections. Tax cuts also require that the government cut services, which often benefit poorer people. Imagine that...
We need to raise the income taxes on the wealthy. We need to end our wars of imperial aggression against the people of Afghanistan and Iraq. We need to cut our bloated imperial military budget in half. We need to stop outsourcing our good manufacturing jobs and high tech jobs to overseas locations. We need to raise our tariff walls so that Chinese-made shoes cost as much as American-made shoes.