Do you support the Obama infrastructure-tax cut plan?
Topic: Do you support the Obama infrastructure-tax cut plan?
June 18, 2019 / By Adison Question:
Apparently this is the situation:
An 820 billion dollar plan, some of it tax cuts and some of it government spending.
Do you think it's a good plan? I wish it were more focused on GOOD spending and not tax cuts....when the American consumer saves money [lower marginal propensity to consume, MPC] and does not consume it, a tax cut is likely to be ineffective as the American consumer will take a greater percentage of the tax cut and save it.
I would rather the government spend the money, and do it on long-term things like high speed rail, mass transit, infrastructure projects, and NO pork or goodies.
Are we witnessing the long term consequences of short term thinking?
Best Answers: Do you support the Obama infrastructure-tax cut plan?
Temple | 1 day ago
You're 100% right -- and both Republicans and Democrats have raised the issue.
Obama responds by saying "I won".
Tax cuts won't help -- people will save...not spend.
Long term infrastructure project will create some jobs -- but not nearly as many as we'd like.
This was evidenced by one of Obamas economic advisers having no clue how many jobs the program would create -- not even an estimate.
You should read it. There's some good stuff and some stuff that'll likely make your face turn red:
The logic behind the plan:
Consumers no longer have the credit lines they once enjoyed, banks aren't loaning, they no longer have the home equity lines, many have lost jobs and don't have the income and are living off of savings. Add all of that together and consumers aren't spending.
How do you plug the leak in potential business revenue? When consumers are saving instead of spending, how do your rescue businesses that have lost their revenue stream or do you even want to cross that bridge?
The idea is to pump in 600 Billion of government money (our money) to help some of the businesses maintain, or at least minimize, revenue losses. If businesses are unable to maintain revenues, they'll continue to scale back (increased unemployment) until the market dictates their size -- for many, that means closing the doors. That's always a possibility -- but until we hit an equilibrium, people will continue to lose jobs and will continue to save...furthering the losses in revenue and leaving us in the dark to how long and how deep this will go.
If people keep losing their jobs -- more people stop spending -- businesses continue to fail further and release more employees -- unemployment continue to go up -- more people stop spending....it's a vicious cycle until we hit some sort of bottom...an equilibrium.
The other option is to pump money into the system and help maintain some token businesses until we transition into some growth and consumers take over in spending. The problem again with this plan is we don't know how long that will be. So the only real benefit is to create an artificial bottom by pumping money into the system. If the stimulus is too small, all we'll do is prolong the problem and when the money runs out, the economy will tank anyhow until we hit a free-market equilibrium...and eventually start to expand from that base.
It's a crap shoot. A lot of people are saying the stimulus is too small. A lot of people are saying let the free-market correct itself...and if you combine those two -- we'll get exactly what I think is going to happen. We'll inject the money into the economy and in 2011 when the money runs out, people will still be clutching their money, not spending -- at which point congress comes back and asks for more money, or we withdraw government support and the free-market takes over...tanks and then corrects.
The question really is -- what do you think is best? How long do you think it'll last? Are tax-breaks a good idea when people are saving--(if they won't spend what's the point)? Is building infrastructure a good idea when economists can't dictate how many jobs it'll produce? Is there anyone talking about the massive number of jobs that'll be lost regardless -- those companies that don't benefit from the stimulus? Is it big enough -- 800 billion? Do we double up on that when the initial "jolt" runs out in 2011?
Lots of questions that need to be asked if you're to understand the burden of this beast.
I personally would want to see the market take over as government has a very short resume when it comes to successes and taxpayer money -- military, irs...umm..
I also think it'll end up costing trillion(S) if the intention is to maintain some kind of artificial bottom for a reasonable amount of time.
(On the upside -- if the government was to step in and fund some of these innovative companies...one innovation/invention could actually stick and be responsible for massive growth. It's a crap shoot though -- and any banker I know wouldn't be willing to drop 800 billion on the luck of the draw.)
Edit: In response to your second question, the answer is yes. You can't possibly sell a home to somebody who can't afford it - a simple understanding in budgeting. At some point we were going to run into a wall w/ massive foreclosure but nobody of consequence took a stand along the way. World-renown economists were warning us of the consequences back in 1996 -- screaming by the time we got to 2000 -- and buried in politics by the time the bottom fell out. Too much greed...all around...government, free-market and consumer. We knew it was coming and didn't do anything.
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Originally Answered: obama supporters what would obama have to do to get you to not support him?
I figured when he was shown belonging to a black racist church and referred to his mother as a whore in his autobiography was enough
Then I thought it would be that he voted to keep funding the Iraq War and Voted against a time table for withdrawal and only votes based on which lobbyist pays him.
Then I thought it would be that he was still smoking.
But it seems he can do anything he wants and gullible people will continue to support him
Wait, I have to stop laughing... Neither of them have an economic plan of any substance or value. Did you forget they BOTH voted for the Bailout???! Oh, that was a real smart economic plan wasn't it? Bailout the banksters so more people can go further into debt. And they voted for it AGAINST THE WILL OF THE PEOPLE!!! They essentially gave us the finger! The stock market is crashing, WORLD WIDE... this isn't just about America, but the entire world is involved. You simpletons that have fallen for the right/left paradiagm of politics are soon going to have a rude awakening to what is really going on. The real economists have been trying to warn you people, but you are listening to the wrong people. The economists that support McCain are idiots. They are dumber than either McCain or Obama. It is obvious, can't you see it? McCain and Obama are not economists, they have no clue how a economy is run. It certaintly isn't doing well under the present manipulation of the government, now is it? Governments can't run an economy, they don't know how and they aren't suppose to. The people and the free market determines the economy. DUH! Why do you people think government is here to save your sad butts? That is not the role of government. You run crying to the fricking government the minute you scrape your knees. So to shut you up they put a bandaid on it and kiss your sorry butts and promise everything will be fine. When they should've said, "You're Ok, you'll heal, brush yourself off and try again." Grow up America! Wake Up! Take responsiblity for yourselves!
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I would rather the goverment spend the money to create manufacturing jobs. Alternative energy, solar cars, Food, Drugs or something that the world needs. If you dont produce goods all you are is a consumer, at some point we are going to have to pay the piper.
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I would support making the death tax elimination permenant and all tax margins cut, including corporate taxes.
Businesses can get the economy going again, not the government.
Why in God's name would we want a $1 trillion bail out when we can leverage $250 billion in tax cuts against a $13 trillion commercial production economy?
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Where will the 820 b. come from? What you are saying is that we should just let govt. take our money and decide for us how to spend it. Shouldn't the Consumer be able to decide what he/she does with the money earned. The entire plan is pork.
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