I was thinking about my remarks about the tax cuts for individual taxpayers that I wrote in my article on bank credit yesterday. I said:
One can argue about the necessity for budget cuts, but the fastest way to balance the budget is to reduce expenditures and reduce taxes which would ultimately yield more revenue for the government from a growing economy. It is still my opinion that growth will be flat and that we will be facing inflation, assuming the Fed continues to monetize federal debt. But money in our pockets will be more “stimulative” than if given to the government to spend. This is a huge, complex issue, which I will deal with soon in another article.
I will stand on those remarks but with a bit more explanation. The reality is that there is no tax decrease at all. Pretty obvious. It just continues the Bush tax cuts. While beneficial in an economic sense, it puts no new money into people’s pockets. I think I zoned out a bit when I wrote the above statement. It is still true that “money in our pockets will be more ‘stimulative’ than if given to the government to spend.”
On a similar topic, I am galled when I hear politicians despair over the fact that the rich are not paying their fair share or that this “cut” will cost we taxpayers money. What a crock. Two crocks actually. Here is the truth. The really rich, the top one percenters, pay 38% of all individual income taxes. The top 10% pay 70%. And tax cuts cost us? No, it is federal spending that costs us. When are these people going to understand that we don’t want our taxes raised? Cut the damned spending.