On Feb 9, 2009, at 9:08 PM, Lance McCulley wrote: > CLAIM: Corporate tax rate cuts and capital gains tax rate cuts would > provide substantial stimulus > > In a January 29 speech at the Heritage Foundation, Sen. Jim DeMint > (R-SC) attacked the economic recovery plan and offered his own "Jobs > Plan That Works," saying, in part: "Just as we cut taxes for > families and small businesses, we need to cut them for corporations > as well, from 35 percent to 25 percent. And we shouldn't be afraid > to say so. Our corporate tax rate is one of the highest in the > world, driving investment and jobs overseas. Lowering this key rate > will unlock trillions of dollars to be invested in America instead > of abroad." On the January 21 edition of Hannity's Fox News show, > Michael Steele, now chairman of the Republican National Committee, > said: "You want -- if you want to stimulate this economy, eliminate > the capital gains tax for two years and see what happens. See what > happens on Monday morning if you eliminate it today." Like DeMint > and Steele, Limbaugh, in his January 29 Wall Street Journal op-ed on > how best to stimulate the economy, wrote: "I say, cut the U.S. > corporate tax rate -- at 35%, among the highest of all > industrialized nations -- in half. Suspend the capital gains tax for > a year to incentivize new investment, after which it would be > reimposed at 10%." On the January 27 broadcast of his radio program, > Hannity attacked the tax cuts in the recovery package as "anemic" > because "They don't cut corporate tax rates. They don't cut capital > gains tax rates." > > However, as Media Matters has noted, many economists do not view > corporate tax rate cuts and capital gains tax rate cuts as > particularly effective methods for stimulating the economy. Mark > Zandi -- the chief economist and co-founder of Moody's Economy.com, > who was reportedly a McCain campaign economic adviser -- included in > 2008 written congressional testimony a table stating that every > dollar spent through a "Cut in [the] Corporate Tax Rate" produces a > GDP increase of only $0.30 -- the third least-efficient provision of > the 13 he studied. A 2003 Congressional Research Service (CRS) > report stated that a "capital gains tax cut appears the least likely > of any permanent tax cut to stimulate the economy in the short run; > a temporary capital gains tax cut is unlikely to provide any > stimulus." >
Tax Rate Cuts are a way to stimulate the economy without all the mess government's create when they try to do it themselves thru Stimulus Bills. And unlike most stimulus plans, they do not crowd out private investment (they encourage it) nor do they create massive amounts of government debt. The CBO estimates Obama's stimulus plan will actually hurt the economy and GDP in the long term. > > On the January 23 edition of Hannity, former New York City mayor and > 2008 Republican presidential candidate Rudy Giuliani said: "[T]he > actions of the New Deal, which may have had other reasons for them, > did not work from the point of view of solving the Depression. In > fact, by 1936, '37, '38, the Depression was arguably just as bad as > it was in 1929." Hannity and Limbaugh have also worked attacks on > the New Deal into their criticisms of the economic recovery package, > with Limbaugh stating as fact that the New Deal "didn't work," and > "prolonged" the Great Depression. Such claims have been flatly > rejected by prominent economists, including Nobel laureate Paul > Krugman, who has said that President Franklin Delano Roosevelt did > not go far enough to end the crisis and that it was actually > Roosevelt's reversal of New Deal policies -- in an attempt to > balance the budget -- that hindered recovery. Once again, the government tried to intervene with the New Deal, screwed it up (author thinks by not making it big enough; which makes me laugh), and failed to bring about a quick and decisive end to the depression. Notice how even when the causes are different, the ultimate outcome of government stimulus is always the same. FAILURE to bring about quick and decisive ends to economic downturns? > CLAIM: Fiscal stimulus in Japan failed during the "lost decade" of > the 1990s > On October 22, 2008, the Republican caucus of the House Budget > Committee released a report citing "Japan's policy responses during > its so-called 'lost decade' of the 1990s" as evidence that economic > stimulus plans supported by Democrats in Congress would be > ineffective. Both Limbaugh and Hannity have similarly cited Japanese > fiscal policy in the 1990s in arguing against a large-scale economic > recovery plan to combat the current recession in the United States. > However, prominent economists have stated that economic conditions > did improve when Japan undertook fiscal stimulus policies but that > reversals of those policies hindered Japan's recovery. On February > 6, for example, Krugman said: "[I]t's clear. The Japanese -- when > they were really pushing hard, when they had strong programs, when > they spent a lot on trying to buck-up their economy -- it actually > did grow. What happened was they chickened out very early in the > process, said, 'OK, let's cut back, let's raise interest rates, > let's raise taxes, let's cut back on those public works.' And they > lost momentum, and they never got it back." Similarly, Adam Posen, > deputy director of the Peterson Institute for International > Economics, wrote in his September 1998 book, Restoring Japan's > Economic Growth, that Japan's "1995 stimulus package ... did result > in solid growth in 1996, demonstrating that fiscal policy does work > when it is tried. As on earlier occasions in the 1990s, however, the > positive response to fiscal stimulus was undercut by fiscal > contraction in 1996 and 1997." He concluded: > > Similar contractions undertaken both openly and by hidden means in > 1994, 1996, and 1997, with reference to announced but unimplemented > spending, had destructive effects. Future government packages must > recognize that when the Japanese government paid for fiscal stimulus > in 1995, it got economic growth, and that when it mistakenly pursued > fiscal austerity in most of the remainder of the 1992-97 period, it > got economic contraction. > CLAIM: Economic recovery bill amounts to spending more than $200K > per job created > CLAIM: $4 billion for ACORN > --http://mediamatters.org/items/200902070003 > I've been over this one before as well. The 12 stimulus plans of the Japanese government implement failed to bring about a quick and decisive end to their 10 year recession. The causes are different (supposedly says the authors) from those that failed the New Deal. In Japan's case they didn't spend it fast enough, then reversed policies to quickly, they increased taxes when they shouldn't have, blah blah blah....END RESULT: 12 STIMULUS PACKAGES FAILED TO QUICKLY AND DECISIVELY BRING THE COUNTRY OUT OF THEIR 10 YEAR RECESSION. Hopefully you see the trend. Jarrad > -Lance > > > --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "Politically Opinionated Outspoken People Expounding Religion" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/pooper?hl=en -~----------~----~----~----~------~----~------~--~---
