National Debt

[Kasz216]

mirgro said:

Kasz216 said:

 

Your second paragraph is argueing against your first paragraph.  The rich know how to keep their money... because they invest it.  They won't be buying private planes... they'll be investing in new buisnesses and stocks.  Creating supermarkets, malls and theatres.

You give the cut to the rich because it's faster.

Rich people create buisnesses, jobs and GDP growth.  Everyone else gets money from the buisnesses, jobs and GDP growth becomes richer and buys more stuff... which in turn creates more buisnesses, jobs and GDP growth.

 

Give it to the poor, and you have to wait for them to spend the money before you get the buisnesses, jobs and GDP growth.  By getting money you lose out on the first round of GDP growth which actually ends up putting the poor in a hole.

Also do you know who it REALLY puts in a hole.  The REAL poor.  IE those who aren't paying income taxes anyway and only pay social security and sales taxes.

While the "poor" are out spending their new cash... the "real" poor have to wait months and maybe years for that money to get to the rich to create new jobs for them... the unemployed or those only working part time. 

Not only are they not getting those new jobs right away, you've probably cut their benefits just to give the other poor their jobs.  Either that or your running up the deficit like Reagan.

I understand where you are coming from. But it's as I said in the first paragraph, the money will end with the rich anyhow it's just a question of when. Also by cutting the taxes on the rich there are indeed less taxes collecting, therefore helping out the real poor less.

And in turn.. the money will end up with the poor anyhow... through the investments... it's just it will effect the economy positivly more quickly.

Also, less taxes are being collected either way... the difference is... the real poor get helped sooner by the GDP growth quicker.

 

Let me set up a quick hypothetical to drive home the point.

 

January Earth A - The rich Get a tax cut... the rich start investing.   Unemployed/Underemployed beneits are cut.

January Earth B - The poor get a tax cut... the poor start buying.  Unemployed/underemployed benefits are cut.

March Earth A - The investments take hold.  The Unemployed/Underemployed numbers shrink.  The base of people being taxed grows as the poor taxed growns.  Now only do the poor taxed grow but so do middle level management positions.  Not only are less people poor, but more people are paying income, sales and federal taxes.  So your making back that money you lose in taxes.  The GDP grows say... 10%

March Earth B - The money is reaching the hands of the rich... who start investing it.

July Earth A - The money is reaching the poor start buying. 

July Earth B - The investments take hold.  The Unemployed/Underemployed numbers shrink.  The base of people being taxed grows as the poor taxed growns.  Now only do the poor taxed grow but so do middle level management positions.  Not only are less people poor, but more people are paying income, sales and federal taxes.  So your making back that money you lose in taxes.  The GDP grows say... 10%/.

 

Now if we expand this out forever... Earth B's GDP is going to constantly be behind Earth A's GDP... including per captia.

EVERYONE in earth A is better off then Earth B... INCLUDING the poor who would of gotten the tax cuts because in the long run the GDP growth likely outweighs the short small term gain.