I will start.
I reject the economic theory commonly called “supply-side economics.” If I understand it correctly, the idea is if you reduce taxes on the wealthy, they will invest the extra money (start new businesses, expand existing businesses ect) and that will create more jobs.
My econ professors were always fond of using hypothetical situations to explain economic theories so I will do the same.
Let’s say that you own a restaurant. Now let’s say that there is a recession. Because of this recession there are less people than normal in your restaurant, and as a result you lay off most of your waitresses. Now let’s say that someone gives you a bunch of money, $100,000 is a nice round figure. Now this is more than enough money to pay a waitress for a year, but as a smart business owner you know that if you hire a waitress she will just stand around in the restaurant because there is no one to serve.
My point is that investment is only viable when the economy is doing well.
If the economy is doing well, and your restaurant is full nightly, then you should be seeing a healthy profit. If this is the case then you don’t really need the government’s help. You already have the money to start hire more servers.
It seems to me that the economy is driven by demand rather than supply. More customers make your restaurant more profitable not more servers.
I believe that the tax cuts would work better on the middle and lower classes than on the upper classes.
I guess this would be trickle-up?
Discuss.
I reject the economic theory commonly called “supply-side economics.” If I understand it correctly, the idea is if you reduce taxes on the wealthy, they will invest the extra money (start new businesses, expand existing businesses ect) and that will create more jobs.
My econ professors were always fond of using hypothetical situations to explain economic theories so I will do the same.
Let’s say that you own a restaurant. Now let’s say that there is a recession. Because of this recession there are less people than normal in your restaurant, and as a result you lay off most of your waitresses. Now let’s say that someone gives you a bunch of money, $100,000 is a nice round figure. Now this is more than enough money to pay a waitress for a year, but as a smart business owner you know that if you hire a waitress she will just stand around in the restaurant because there is no one to serve.
My point is that investment is only viable when the economy is doing well.
If the economy is doing well, and your restaurant is full nightly, then you should be seeing a healthy profit. If this is the case then you don’t really need the government’s help. You already have the money to start hire more servers.
It seems to me that the economy is driven by demand rather than supply. More customers make your restaurant more profitable not more servers.
I believe that the tax cuts would work better on the middle and lower classes than on the upper classes.
I guess this would be trickle-up?
Discuss.
