Re: Cutting Taxes to Spur the Economy

From: Dossy (dossy@panoptic.com)
Date: Sun Jul 06 2003 - 18:11:21 MDT

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    On 2003.07.05, Lee Corbin <lcorbin@tsoft.com> wrote:
    > It's true that most people do not know how to save money, and this is
    > very bad for them. However, my questions are
    >
    > 1. when should government print money

    When it needs more new money, of course.

    I don't know much about this printing of money business. I hear it
    devalues the currency ... which might be good if your currency is strong
    and obviously bad if your currency is weak.

    > 2. when should it reduce taxes *in order to* stimulate growth".

    Define where you're measuring "growth" -- that's important. Raising
    taxes stimulates growth in the government agencies while reducing taxes
    stimulates growth in the private sector. I presume you're only
    interested in the private sector, so ... I think any time you reduce
    taxes, you are stimulating growth in the private sector.

    Is the tax reduction enough to overcome other forces that may continue
    to depress the economy? Perhaps not, but if you don't set things in
    motion, you'll never sink any balls. Doesn't mean every time you set
    things in motion, a ball will be sunk ...

    > > So, tax cuts really is an alternate form of taxation: instead
    > > of people giving their money to the government who then has the
    > > burden of budgeting
    >
    > "burden", yeah right ;-)

    There are folks who can't budget a $700-a-week paycheck to adequately
    cover their bills. How many people do you think have the skills to
    budget billions of dollars?

    (Obviously not most of our politicians, either ...)

    > > and distributing it out to government organizations, a tax cut
    > > effectively cuts out the government as the middle-man and sends
    > > that money directly back out into the economy.
    >
    > A nice generalization, but not always true. What about the
    > times that government projects, usually infrastructure, end
    > up creating wealth in the long run?

    Like which?

    -- Dossy 

    -- 
Dossy Shiobara                       mail: dossy@panoptic.com 
Panoptic Computer Network             web: http://www.panoptic.com/ 
  "He realized the fastest way to change is to laugh at your own
    folly -- then you can let go and quickly move on." (p. 70)

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