Bush's Taxing Stupidity

[Linette]

Bush's Taxing Stupidity

From James Kroeger's blog entry today:

"Try to listen carefully, George: you need to raise taxes if you want to stimulate the economy, not cut them. How can this be true? It's very simple, actually. It all depends on whose taxes you are raising/lowering."

"If you raise the income tax rates of rich people, the predictable result is an increase in aggregate spending, greater economic growth, and lower unemployment. This is because such a tax hike ultimately takes money that would have been saved (by rich people) and spends it, instead. That creates jobs. Always remember, all jobs in the economy owe their existence to the spending of others (consumers, businesses, or the government)."

"The only reason why we ever have any level of unemployment in the economy is because too much saving is taking place. The only reason why recessions ever occur is because there is a decrease in spending. Sales drop. People are laid off. Why does spending drop? Because some people---who have a choice to either spend or save their money---decide to not spend (i.e., save)."

"If your country has an unemployment problem, it can be eliminated by increasing the amount of taxes that are collected from the wealthiest members of society. This is because large amounts of the money that they would be handing over to the government would have been saved by them otherwise. When you take money that would have been saved and spend it, it causes an increase in sales and that leads directly to more hiring by businesses."

"If the government were to increase the taxes of average folk, it wouldn't have the same positive effect on the economy. This is because the increase in the government's spending would be offset by the decrease in consumers' spending. Because spending is spending, this means that it would have neither a positive nor a negative effect on total spending in the economy. It is only when you increase the taxes of rich people that increasing taxes will stimulate the economy and create jobs."

"In spite of all the Wall Street propaganda you've heard to the contrary, America does not suffer from inadequate savings. Remember, any time your economy is suffering from any level of unemployment, it is because too much saving (by rich people) is taking place. They are the ones who can afford to give up some of their excess savings for the good of their country. (Instead of saving $5,000,000 this year, see if you can get by with only an additional $500,000 in savings.)"

"More spending, less saving by the Uber-Rich. That's how you fix your country's economy when people need jobs."

Why haven't Democrats been explaining this to the public?