Do You Think That Supply Side Economics Is The Future?

[Donkeykick]

I mean with the tax cuts and all. If yes or no, why?

[Caution]

1. Is this a serious question?

Supply side economics is based on the assumption that the wealthy will effectively take care of the poor by spending the money they save on taxes or re-invest it into companies thus providing jobs and services for the poor. This has no chance whatsoever of working and is the most absurd economic "theory" in a long time. It's basically something completely invented by the wealthy to save them money on taxes.

If it worked the gap between the wealthy and the poor would shrink/. the gap has expanded greatly every time that rich republicans have had power and tried to sell us on this crap.

[ret5hd]

3. really, what IS the point of this question?

[Coastie for Truth]

2. No. It is Pure Bull.

You want to understand why - read this --Macroeconomics by Paul Krugman, Robin Wells


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[Donkeykick]

11. Thanks for the heads up on the book.

I think that I will.;-)

[Terry in Austin]

32. Ah, Krugman!

He describes supply-side theory as "crackpot economics." There's another Krugman book, for more general audiences, that goes into supply-side and other economic snake-oil: Peddling Prosperity. The subtitle is "Economic Sense and Nonsense in an Age of Diminished Expectations."

Apparently, there are no actual economists who are supply-siders; just some journalists, an ex-editor of the Wall Street Journal, and a handful of "policy entrepreneurs" (Krugman's term) who were able to get the ear of a grade B actor who was playing President at the time.

Terry

[burythehatchet]

4. Absolutely, because as you know

a high tide lifts all boats. Especially those 200 foot yachts.

Also, I believe the Edsel is going to be a huge automotive success.

[Toots]

13. Only if the boats have not been permenantly beached.

Not all boats are in or near the water. A lot are in back yards and garages and it would take a very high tide indeed. If you want all boats to float you must allow the boats to enter the water... High fuel prices put a huge damper on that. Only the wealthy float their boats in these days..

[burythehatchet]

15. I hope you detected the sarcasm in my post

the Edsel comment should give that away:)

[Toots]

18. Yes I was just spouting off and not at you, just in general

I have heard that rising boats comment too damn often. It isn't true now and never was. Some boats have holes in them that need fixing before they float. I know I am carrying the metaphor to an extreme but why not? It is a false metaphor...

[CatholicEdHead]

5. Maybe short term but not long term

it is unstainable. The worm will turn and this will be disgraced for another century.

[bvar22]

6. Just hop in the ole "Way Back" machine.

Have boy Sherman set the dials for 1910.
Take a look around. 1% live like kings, everybody else struggles to put food in their stomach.
Many DIE in the streets.
"Supply Side Economics" has already proved itself to be a miserable failure.
In Fact, Pure Capitalism has already proves itself to be a FAILED economic system.

[McKenzie]

7. oil prices are treated as a function of supply side economics

However, that is predicated on the erroneous paradigm of infinite supply. The market cannot allocate prices fairly in the context of finite supply of an essential resource because geopolitical considerations distort the free market.

Smith, Bentham et al, envisaged a free market where there was true competition amongst suppliers and providers. In effect, ease of access to, and egress from, the market based upon pure, market factors. Once political factors influence supply the market cannot operate as the 18th century authors intended.

That's macro-economic considerations, of course. At the domestic level supply side economics might allocate resources efficiently in the context of conventional, economic theory. Whether supply side economics distribute resources fairly is open to discussion. That discussion has to include moral factors but nowhere in conventional economic theory does morality enter the equation. That's what is wrong with our economic theory - we assume that efficiency equals best but best and moral have different definitions in the dictionary I use.

We are moral animals - economics does not take into account externalities and it assumes that we will all seek to maximise our utility - whatever the fuck that is supposed to mean and regardless of the human cost. Those apologists for market theory who also claim to be Christians might like to answer that (irreconcilable IMO) question.

In summation, economics is an abstract concept, devoid of the quality that makes us human, namely morality. Supply side economics might allocate resources efficiently. Whether supply side economics equates with fairness is another question altogether.

[Nikki Stone 1]

8. Why do some rely on 18th c. economic models, but not on 18th c. medicine?

Both fields have come a long way in 200 years.

[McKenzie]

9. good question...

18th century economics is based upon the assumption that resources are infinite. The most important resource of all - energy - is not and it does not allow for morality in the equation.

We are moral animals - economics is nothing more than an absract without the human factor. Your medical analogy is apt. Times change - economics is still rooted in the past. LOL.

[depakid]

17. It was the Neoclassicals (marginalists)

Who ousted resource use and ecological services from the equations in the 19th Century

By most definitions, liquidating and/or eroding natural captital is not income- though it's generally accounted for that way. Odd, considering that thermodynamics was developing around the same time.

Maybe we should go back to 17th and early 18th Century medicine! The 20th Century variety seems like steriods, and its ending up killing the patient...

[Jayhawk Lib]

10. I need to get educated

How is raising the tax on the rich going to help the poor and middle class? It may lower the tax on the middle class which may help them some but will not really make them rich. It will not help the poor because they really do not have much, if any, tax burden.

You can raise corporate taxes but corporations just pass that tax on down to the price of their product and the customers end up paying that tax.

It seems, and I very well may be wrong on this, but it seems like you need the rich to invest and buy things to provide jobs for the rest of us.

I am probably all wet on this but I would like to get enlightened.

[Donkeykick]

12. Well...

it would seem to me that businesses are already doing that anyways. What about when prices go up on their expenses? They just go ahead and pass that on to the consumers.

But we have the right to shop somewhere else for a better bargain.

Now there are a lot of businesses that will receive those tax cuts, and then take their business overseas too.

[Jayhawk Lib]

27. Better bargain??

That better bargain will be some foreign made product. Raising taxes on business only encourages them to go overseas.

Business does not pay taxes it only collects taxes.

[rman]

21. raising tax on the rich

can help finance such things as universal health care, social security etc.

"you need the rich to invest and buy things to provide jobs for the rest of us."

That has been done for some 30 years now, and the result is the opposite of what was promised. The rich got richer and the poor got poorer. Wealth does not trickle down, it trickles upward.

[Jayhawk Lib]

26. Can Help

Sure taxing them can help but not finance health care or Social security. You can really raise the tax on the rich a lot but when you tax them to where they are not buying boats planes cars and not investing money, how are the rest of us going to have jobs.

An example when Clinton and the congress put a huge luxury tax on the boat business the rich and affluent quit buying boats and it put thousands in the boat building industry out of work.

Raising the tax on the rich has never ever brought the poor out of poverty.

[rman]

28. Neither has lowering taxes helped the poor

Bush's tax cut is no more the a few bucks for the poor, but many thousands for the rich.

Fact is that European countries have a progressive tax, and social services there are better then in the US.
Even Castro takes better care of the poor among his people. "Poor" there means that you still have housing, food, health care and education.

[Jayhawk Lib]

30. Why are poor Cubans risking their life to get over here.

As a matter of fact why do we have such an illegal immigration problem here? All the poor people in the world want to come here.

[rman]

33. Relatively few Cubans try to go to the US

Being poor in the US at best means holding multiple part time jobs and then still not being able to make ends meet. Many of the poor in the US don't have enough to eat and have no health care. Why would "all the poor people in the world" want to go to the US?

[Jayhawk Lib]

34. I would suggest you read this post

http://upload.democraticunderground.com/discuss/duboard.php?az=view_all&address=364x91291

[rman]

39. I already knew some Cubans try to get to the US. It does not prove

that "All the poor people in the world want to go to the US".

It's interesting that you not deny the poor state of US care for its poor.

[Commie Pinko Dirtbag]

37. Let me keep it simple for your benefit.

There is such a thing as an ideal tax rate. I assume you don't believe it is equal to zero. (Might be a BIG assumption here, I know, but bear with me)

If for some people the current tax rate is below that -- it needs to be raised.

If for some people the current tax rate is above that -- it needs to be lowered.

Capisce?

[BlueManDude]

14. Demand-Side, Trickle-Up Economics is the future

just need the Dems to get their act together and push it.

[justabob]

22. Agreed, but I call it economic populism nt

[BlueManDude]

24. It's about policies geared toward "the people",

the great mass that call themselves "middle class" as opposed to policies geared towards the corporations that sell things to the middle class. The feds need to make it easier for folks to afford education, housing and health care as opposed to what they're doing with say the student loans rates which will go up soon. It's not a handout it's just a re-focussing of priorities. If people feel better about the ability to deal with the 3 biggies (health, housing and education) then they'll go out and spend that money on the cars and computers and plasma screens - but it needs to come from the bottom up not top down.

Point is - if people can barely afford the necesities then they surely can't afford the gizmos and this is no good for anyone. All the corporate tax breaks in the world (and labor cutting moves) will do no good if no one can afford the gizmos.

[justabob]

25. Right

I really don't understand why no one, or very very few, leaders take up this cause. I know the super wealthy don't want to see the masses happy, but really, they benefit and get richer too.... Probably far richer than cutting taxes etc make them. This is so very simple and should not be controversial at all. If people on the bottom can pay their bills they can buy more stuff, so more stuff has to made, so more people have jobs, so more people can buy stuff, so more needs to be made..... Who loses here?

[Maestro]

16. Nope. See this thread

of mine from a few days ago. The Boom That Wasn't.

[yella_dawg]

19. "Supply Side" is to economics

is what "Intelligent Design" is to biology. It's a rationalization of the desires of the powerful into a pseudo-theory that allows them to pretend it's something other than naked greed.

[ZombieGak]

41. what did Galbraith once say.....

Something along the lines that trickle-down economics was merely the latest attempt to infuse human greed with some nobility?

[mantrid]

44. right on- well said.

n/t

[rman]

20. 30 years of it have shown it is a scam

It results in the opposite of what it was promised to do.
The rich got richer and the poor got poorer.
The tax cuts do not offset the increasing cost of health care, heating, property tax etc. To the rich this is of little consequence, but to the poor it is of much consequence.

[MikeNY]

23. The government is too unstable to handle it

OK, there can never be a “fair” economic model. There can never be a merit system, or meritocracy (ala Star Trek or something…) until humans evolve. I mean big time evolve. Supply side economics might be a good idea, in moderation, if the government could actually afford to give tax cuts to corporations and the wealthy, let alone anyone. If the government itself was not a train that is about to derail at any given moment because it is overburdened by corruption, debt, and an absence of ethical leadership it might be a good idea. But the level of corruption in this party is remarkable. Somehow the Republican vision of creating smaller government by “starving the beast” got turned into spending trillions of dollars and increasing the size of government more than any Democrat would have ever planned. They don’t even have to write the laws anymore; they have the lobbyists do it for them. And in this case rather than increase the size of the deficit for some socially useful purpose most of it is going to kickbacks, special interest groups, and the Defense Department… who knows.

When Republicans talk about supply-side economics they are talking about giving public money (that we can't really afford to spend) into the hands of the benefactors that got them into power.

[leftofthedial]

29. it is the current ideology

but it can't last because it doesn't work. it bankrupts whatever economy organizes around it and that economy collapses. so it can't last long enough to be anything "of the future." It is just dogmatic, ideological wishful thinking by a bunch of stupid, ignorant people being led by the few who prosper temporarily under the trickle down hocum.

[long_green]

31. It IS the future

the future cause of death, that is.

[baldguy]

35. There used to be another term for "supply-side economics" -

We used to call it "feudalism"

[triguy46]

36. As a canard of the right, only as long as we allow them to continue

to steal elections. It is make believe, a failure. Has the original poster been living in a vacuum or off planet for a while?

[sweetheart]

38. A progressive future?

I don't care for labels, as any economist looks at both supply and demand in
a market, all market changes are wholistic.

A progressive future will see the rise of public-goods exchanges, where credits
are sold for increasingly scarce public goods contracts, and these will, if
institutied properly, be a major way towards dealing with global warming and all.

But at the core, we have a problem, the financial monopolists have created an
ineffecient system of the issuance of currency, the maintanance of the core of
the capitalist system. I'd say that a progressive future would make the supply
side reform of founding the bank of the united states, finally, that public
credit be issued without the corruption of today.

Another reform of the supply side is to institute strong enforcement of market
monopoly rules. The mergermania has created a fat, price fixed set of unchecked
oligopolies in most every market sector. It is blocking economic progress.

For peets sake, 1 IRS website could take every citizens tax return online without
a list of intermediaries and faux tax attournies and all thata whack... would
they finally take back the public common of public taxation and the information
tools of filing. The existing system is so corrupt that entire false industries
exist for the lack of reform, and tax filing is one of these industries.

The overhead of an unreformed economy is leaving the US weak as other world nations
that are more adaptive, are able to reform their supply-side institutions.

FOr all the talk, there has not been a supply side economist in power doing
any serious engineering since FDR... and before him, Teddy. R...
.. maybe i missed one... maybe not.

[ZombieGak]

40. supply side is insidious right wing propaganda

There's just no consistent evidence that tax cuts do what the Right claims.

But then those claims are just a smokescreen to cover the true intent of the Right... that the REAL intent of tax cuts is to sabotage government revenue and provide massive tax breaks to those who support the Right.

[kentuck]

42. Not for much longer....unless you believe....

Ronald Reagan proved deficits don't matter, as Cheney said. It's as obvious as the nose on your face, there is no free lunch. Even if they print dollars to pay for the debt, we still pay. And the people at the bottom pay more. It's just a matter of time before the bubble bursts. We just don't know where the breaking point is...

[yurbud]

43. Yes--the future of a Third World United States. I'm already staking out..

a good cardboard box a refrigerator came in and a ditch to shit in.