Comment by ayaros 17 hours ago
Why is this so horrible. Put more resources in the hands of the average person. They will get pumped right back into the economy. If people have money to spend, they can buy more things, including goods and services from gigantic tax-dodging mega-corporations.
Gigantic mega-corporations do enjoy increased growth and higher sales, don't they? Or am I mistaken?
The framing of X or Y are job creators is idiotic. Its literally the most basic fact of economics that you need producers and consumers, otherwise you don't have an economy.
The more economically correct way to express this would be that entrepreneurs and companies who innovated increase productivity and that makes the overall economy more efficient allowing your country to grow.
> Or maybe it was trickle down economics. Trickle up economics still end up with the rich getting the money since we all buy things from companies they own, it just goes through everyone else first. Trickle down cuts out the middleman, which unfortunately is all of us.
This just sounds like quarter baked economics ideas you have made up yourself. Neither 'trickle down' nor 'trickle up' are concepts economist use. And that you confidently assert anything about the social outcomes of these 'concepts' is ridiculous.
Because the entire western culture has shifted to instant gratification. Yes, what you suggest would most likely lead to increased business eventually. But they want better number this quarter, so they resort to the cheap tricks like financial engineering/layoffs to get an immediate boost.
Because government is always a fight about resources. More resources in the hands of common people and to make their lives better is less money in the hands of powerful corporations and individuals, be it in the form of higher taxes for the rich or less direct money going to their enterprises.
One of the big issues is money in politics. Our congresspeople make a killing off of legal insider trading, they take huge donations from companies, and the supreme court has even said that it's cool to give "gratuities" in exchange for legislation or court rulings you like.
Corruption is killing this country.
I'm not saying you are wrong that some redistribution can be good, but your analysis is simplistic and ignores many factors. You can just redistribute and then say 'well people will spend the money'. That's literally the 'Broken Window' fallacy from economics. You are ignoring that if you don't redistribute it, money also gets spend, just differently. Also, the central bank is targeting AD, so you're not actually increasing nominal income by redistributing.
Take a million dollars, give 1,000 poor people $1,000 and every dollar will be spent on goods and services. The companies running those services and making those goods will need to have their employees work more hours, putting more money back in poor people’s pockets in addition to the money the companies make. Those employees have a few extra dollars to spend on goods and services, etc.
Give a rich person a million dollars, and they will put it in an offshore tax shelter. That’s not exactly driving economic activity.
You are simply disagreeing with 99% of economists.
Money in tax shelter doesn't go threw a portal in another universe. Its either invested or saved as some kind of asset and in that form is in circulation. And again, even if you assume it increases monetary demand (decreases velocity) the central bank targets AD and balances that out.
Based on your logic, a country that taxes 100% of all income and redistrubtes it would become infinity rich. Your logic is basically 'if nobody saves and everybody spends all income' everybody will be better off.
This is not how the economy works even if it feels good to think that. Its a fallacy.
Where you could have a point is that potentially the tax impact is slightly different, but that's hard to prove.
There are many ways of spending money in the population that don't include just "distribution of money", as it's portrayed nowadays. Child care, free and high quality schools, free transportation, free or subsidized healthcare, investment is labor-intensive industries, these are all examples of expenditures that translate in better quality of life and also improve competitiveness for the country.
Stock buybacks don't build anything. They're just a way to take money from inside a company and give it to the shareholders.
The shift in the US to the idea of “job creators” being business owners is part of it. It was just a way to direct money to the already rich, as if they would hire more people with that money. When it is plainly obvious that consumers are job creators, in that if they buy more goods and services, businesses will hire more people to make or provide more of those things.
Or maybe it was trickle down economics. Trickle up economics still end up with the rich getting the money since we all buy things from companies they own, it just goes through everyone else first. Trickle down cuts out the middleman, which unfortunately is all of us.