Voodoo Economics

[Mythsaje]

I've touched on this before but I think it's time to try another round. Most Dems HERE, at least, seem to get it.

The Republican/Conservative ideology when it comes to economics is morally and intellectually bankrupt. They try to tell us that giving tax breaks to the capitalists somehow stimulates the economy when it's plain to any clear-thinking person that it doesn't.

Why not? Simply put, the richest Americans tend to hoard wealth. They don't spend it. They don't put it back into the economy by creating more jobs. "Trickle down" is a hoax. Always has been.

The ONLY way to stimulate the economy is by putting more spending power into the hands of those who NEED to spend money. People that NEED to buy a new washing machine, or NEED to buy more clothes for the kids than the two pairs of pants and three tee-shirts they can currently afford.

By giving more money to those who will spend it, it sends that money back into the economy. By raising the minimum wage, it provides an opportunity for these folks to go out and buy things they need, or that luxury item they've been eyeing for the past few years. As more people go out and buy things, more employees are needed by the manufactures to keep up with demand. More salespeople are needed in the stores that sell these items. Simply put--the more people buy, the more jobs that are created.

The Republicans have been shoving their broken ideology down our throat for the past several years, aided by a corrupt and complicit corporate media. We need to get this message out there, to shatter the myth they've built around it--the myth that promotes the idea that their tax breaks are good for the economy. They do next to nothing for the economy.

The People have already said they want to see a hike in the minimum wage. The people know they're not able to keep up with the rate of inflation and they're hurting.

It's simply not right that executives make millions of dollars a year in salaries, and stuff their pension funds with even more millions, when people who make it all possible have to struggle to feed and clothe their families. But not only is it not right, it's not sustainable. To allow this sort of dichotomy is harmful to this nation and its future. It deprives talented young people of a chance to make a meaningful impact on society because it limits their options.

It's time we banished Voodoo Economics to the dustbin of history. We need reality-based economics. And we need a spokesperson capable of explaining it to the People in a way that they'll understand. The Republicans/Conservatives are wrong. It's just another example of how they're wrong.

We will no longer swallow the lie of voodoo economics. We demand truth, justice, and real-world solutions. Not pie-in-the-sky sleight-of-hand.

[OPERATIONMINDCRIME]

1. Sympathy Kick

:kick:

On edit: Oh, and totally agree with your points too, by the way. :)

[Mythsaje]

2. LOL

Thanks for that.

I do think that we need to confront this crap from the Republicans directly. No one in the spotlight has been doing it very effectively at all. I blame the media, partly, but I'm not sure the message is getting out anyway. It's not a subject most people understand and they're willing to take the word of whoever sounds most credible. Unfortunately, up until now, it's been the conservatives. They're completely wrong, but they're convincing.

[valerief]

3. Double sympathy kick. nt

[texpatriot2004]

4. Trickle Down didn't work then and it doesn't work now. BTW

love that line about banishing voodoo economics to the dustbin of history ;-)

[katsy]

8. Not only that...

there hasn't been one successful working model of trickle down economics anywhere... in any country or any kind of government. Nada.

It's a license to steal.

[zanne]

5. I think the reason there haven't been more recommends is...

Everybody here has agreed with this theory for quite awhile. We know it's an elitist economy and we all want it to change.

[Mythsaje]

7. Yeah...I think you're right.

What I'm trying to do is boil down the theory to the absolute minimal expression so the average person might get it. I know WE understand it, but I'm not sure the average American does. The media and the conservatives have done too well at pushing their meme. Wrong as it is.

[katsy]

13. You already expressed it well...

"Simply put, the richest Americans tend to hoard wealth. They don't spend it. They don't put it back into the economy by creating more jobs. "Trickle down" is a hoax. Always has been."

You've stated the problem well.

[katsy]

6. Interesting article:

From 2003, but definately a good read: http://www.commondreams.org/views03/0922-10.htm


Your thoughts are spot on. :thumbsup:

I don't think the ruling class cares about country or constitution. They can live anywhere, do anything they want. They hold the power of government and media.

This is a feudal society for all intents and purposes.

[Mythsaje]

9. Good article...

Mildly amusing and well stated. Not too high-brow.

I think we should launch an all-out attack on the theory and do everything in our power to discredit it once and for all.

[katsy]

12. That's why I support the grass roots campaining

that Dr. Dean does. We need new blood (populist) in our government.

Most of these bastards in congress (some Dems also) could care less if the average person dies at their feet.

If my memory serves me right, most nobel prize winning economists have discredited trickle down.

It's unfair. It has never worked anywhere. It's the modern day enslavement of the unwashed masses.

[denverbill]

10. Also, cutting taxes does NOT increase government revenue.

If it does, then the problem of fixing Social Security and Medicare should be to cut SS and Medicare taxes, but you NEVER hear a Republican suggest that as a solution.

[Mythsaje]

11. A response on Gather

I see you have no facts, like economists, histories, etc. This is just a one sided ramble of a left leaning individual who wanted to ramble on about how terrible the republicans are.

To be taken seriously, try finding facts to back your words. I can find several facts to disolve your arguments into dust my friend.

******

I told him "then use them."

Still waiting.

[NobleCynic]

14. Your economic arguments aren't completely accurate

"Hoarding money" as you put it does in fact put money into the economy. The question is whether or not the amount of economic benefit gained by the capitalist class, and more specifically the increase in taxes returned to the government by additional investments made by possible by such tax cuts outweigh the loss in revenue to the government. It doesn't. Tax cuts do not pay for themselves. Trickle down economics is also a joke. Any such benefit to working class from tax cuts to the capitalist class must inherently be less then the benefit that would have been accrued to the working class from a tax cut given directly to the working class.

The issue is not whether or not tax cuts to the capitalist class benefit the working class. The issue is that it is an incredibly inefficient and wasteful method of benefiting the working class. And as it seems to be financed solely through debt, rather than spending cuts, it is done at the expense of future generations.

The conclusion is absolutely correct. The details need a little work.

"Hoarding money", or saving capital, puts capital into a bank or other form of investment. The only circumstance where that does not benefit the American economy as a whole is when the investment capital flows overseas. If the money is extradited then indeed the tax cuts to the capital class have been utterly pointless. While this does happen, it is usually not the case. Either way though, money saved and not spent still benefits the economy, provided the money at least finds its way to a bank account.

[Mythsaje]

20. Okay...

Maybe it would be more accurate to say that it's a far less efficient way to put money into the economy than spending it would be.

[citizen snips]

15. Good analysis

I believe that the government should impose high taxes on the rich.

[populistdriven]

16. zfacts.org zfacts.org zfacts.org zfacts.org zfacts.org zfacts.org zfacts.org zfacts.org

Sorry but EVERY DU'r needs to use this site - the data is straight from whitehouse.gov - and it isnt flattering of republican administrations.

click on the Debt chart half way down the page
http://zfacts.com/p/318.html

[Selatius]

17. That's a very powerful site. How did you stumble onto it? n/t

[populistdriven]

18. I found it after Bush made the tax cuts - in 2001

I am distributing copies of this chart to my neighborhood this weekend

[Cerridwen]

19. A kick, a recommend and a quote for your enjoyment...

"They call it "the American Dream" because you have to be asleep to believe it" George Carlin

[NanceGreggs]

21. Pssstttt, Mythsaje!

"We need a spokesperson capable of explaining it to the People in a way that they'll understand."

I think you just did.

Simple, well-stated, to the point.

K&R.

[HamdenRice]

22. Correction for post 1930 economics

I agree with the overall thrust of your post that trickle down economics are ineffective, but I have to disagree with part of your analysis.

You wrote, "Simply put, the richest Americans tend to hoard wealth. They don't spend it. They don't put it back into the economy by creating more jobs."

This was indeed true during the Great Depression and other depressions of the 19th century and first half of the 20th century that were caused by drops in consumption. At that time, it was true, wealthy people tended to hoard their money in local savings banks or worse in their mattresses.

But the economy has completely changed since then, particularly in terms of the vehicles available for recycling wealth through the economy. Wealthy people invest their money. That means that their wealth is available for others to use (borrow) as investment capital.

Whether money is channelled to the middle class or wealthy has a big effect on the economy, but not because the wealthy keep their money idle. When money is channelled to the middle class and poor, the money is used for consumption, which tends to generate manufacturing jobs. When money is channelled to the wealthy, the money is invested in various kinds of investment funds and vehicles where it is borrowed and used for business investment, which tends to generate jobs in industries such as machine tools, business machines and commercial real estate. But either way, the money is used and not simply hoarded.

Given the globalization of industry, it's not really clear that money channelled to the poor and middle class will generate domestic jobs to the degree they used to because so much of what we consume is now manufactured overseas. So middle class tax cuts may generate jobs in Canton, China rather than Canton, Ohio.

[never cry wolf]

23. Jobs follow supply and demand

You are absolutely correct. Corporate profits do not generate jobs, demand for their product or service does. If a business owner has 100 employees making 1M widgets a year that he sells at a profit he won't hire just because he made a profit if he does not need more employees unless those new employees can sell more product or increase efficiency, the latter of which is likely to result in net job loss.