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There is evidence, its just that the evidence is weak and mere co-relations. All of macro economic theory is like that - just models explaining aggregate human

by ksk 8y ago

There is evidence, its just that the evidence is weak and mere co-relations. All of macro economic theory is like that - just models explaining aggregate human behavior. Anything people propose can probably be shown to work in some model or another. On the flip side, higher taxes also don't "lead to" any wage increases or economic growth. Given the massive waste and inefficiency in most government programs, very little of our taxes actually go to anything useful. Most of it goes towards war and to pay government contractors invoicing a $200 "military spec" screwdriver.

dnomad 8y ago
> Given the massive waste and inefficiency in most government programs, very little of our taxes actually go to anything useful. There is very convincing evidence that higher taxes and greater government spending do lead to long term economic growth. These days even the old fuddy duddies at the IMF have been forced to admit that higher taxes don't lower growth [1] and that many times the fiscal multipler is greater than 1 [2]. Certainly from 2008-2015, despite all the austerity hawks going on and on about inefficient government spending, actual evidence indicates the fiscal multipler was nearly 2! [1] https://www.independent.co.uk/news/world/politics/inequality-imf-international-monetary-fund-high-tax-rich-jeremy-corbyn-a7995826.html https://www.independent.co.uk/news/world/politics/inequality... [2] https://www.washingtonpost.com/news/wonk/wp/2013/01/03/an-amazing-mea-culpa-from-the-imfs-chief-economist-on-austerity/?utm_term=.8b9c2def2ad0 https://www.washingtonpost.com/news/wonk/wp/2013/01/03/an-am...
- ksk 8y ago
  If you wanted to, you could fill a cup of water by dumping a gallon bucket on top of it. The point here is that the government has never been efficient in allocating resources. Also FYI: I'm not a representative or a supporter of the IMF. The fact that some of their people have said things which didn't turn out to be true doesn't concern me. In fact I'd probably expect that most bold predictions don't come true, especially on economic matters.
bobwaycott 8y ago
This is ideology and attempted political point-scoring, not evidence. There aren’t even a preponderance of correlative data that shows a link between tax cuts and economic growth—except where economic growth is defined as a disproportionate increase in wealth concentration in ever smaller percentages of the population. The opposite has been shown—and quite conclusively—with decades of data (that tax cuts do not spur economic growth). Moreover, seeing as how you’re dragging out the old government waste trope—its notable that you conveniently neglect to directly indict those on the receiving end of this “waste”. It cannot be solely the government’s fault that private corporate contractors happily pocket this waste. If waste is something you find especially onerous, shouldn’t we start by pointing the finger at the private companies who submit “wasteful” bids/invoices? If the government is paying too much and wasting public funds on contractors, doesn’t the fault lie with those submitting the bids/invoices? If there is nothing at all wrong with their bids, and we want to say it’s acceptable to bid any amount so long as the bidding is, say, fairly open to all comers, then how exactly can the government be guilty of “waste”? Seems every time the government is criticized for waste, it’s always a one-sided critique. Meanwhile, attempting to reign in this alleged waste with regulations, bid caps, stronger negotiating power, or some form of (gasp!) price control mechanism for public projects is rather uniformly met with charges of abuse of power, not playing by the rules, crippling free markets, or some other such nonsense. If there is waste, it starts with exorbitant bids/invoices for that $200 screwdriver. Seems to me the government is simply playing by the rules and paying what is demanded. There’d be a shit storm if they didn’t.
- ksk 8y ago
  >There aren’t even a preponderance of correlative data that shows a link between tax cuts and economic growth—except where economic growth is defined as a disproportionate increase in wealth concentration in ever smaller percentages of the population. I can re-define economic growth to mean the size of my checking account. Income inequality has its own definition. You re-defining it to mean something its not doesn't mean much. >Moreover, seeing as how you’re dragging out the old government waste trope Its not a trope. Your personal ideology might or might not allow you to recognize this. I would recommend keeping an open mind. >its notable that you conveniently neglect to directly indict those on the receiving end of this “waste”. Once you create the means for someone to obtain wealth, you cannot fault the individual for maximizing their gains under a capitalist system. Look, if you don't believe that the government does a very poor job of allocating resources, then our disconnect is large enough that realistically no consensus can be reached. The motivations of the people lobbying for their piece of the government pie only exist in a context where (1) people are greedy and (2) the government has tons of money to spend. We can't do anything about #1, but maybe something about #2. >The opposite has been shown—and quite conclusively—with decades of data (that tax cuts do not spur economic growth). Nothing of the sort has been conclusively demonstrated, primarily because macro economics deals with aggregate human behavior - and humans are not automations. To every example of a low-tax low-growth economy is a counter example of high-tax still low-growth economy.

by ksk 8y ago

dnomad 8y ago

> Given the massive waste and inefficiency in most government programs, very little of our taxes actually go to anything useful. There is very convincing evidence that higher taxes and greater government spending do lead to long term economic growth. These days even the old fuddy duddies at the IMF have been forced to admit that higher taxes don't lower growth [1] and that many times the fiscal multipler is greater than 1 [2]. Certainly from 2008-2015, despite all the austerity hawks going on and on about inefficient government spending, actual evidence indicates the fiscal multipler was nearly 2! [1] https://www.independent.co.uk/news/world/politics/inequality-imf-international-monetary-fund-high-tax-rich-jeremy-corbyn-a7995826.html https://www.independent.co.uk/news/world/politics/inequality... [2] https://www.washingtonpost.com/news/wonk/wp/2013/01/03/an-amazing-mea-culpa-from-the-imfs-chief-economist-on-austerity/?utm_term=.8b9c2def2ad0 https://www.washingtonpost.com/news/wonk/wp/2013/01/03/an-am...

ksk 8y ago
If you wanted to, you could fill a cup of water by dumping a gallon bucket on top of it. The point here is that the government has never been efficient in allocating resources. Also FYI: I'm not a representative or a supporter of the IMF. The fact that some of their people have said things which didn't turn out to be true doesn't concern me. In fact I'd probably expect that most bold predictions don't come true, especially on economic matters.

bobwaycott 8y ago

This is ideology and attempted political point-scoring, not evidence. There aren’t even a preponderance of correlative data that shows a link between tax cuts and economic growth—except where economic growth is defined as a disproportionate increase in wealth concentration in ever smaller percentages of the population. The opposite has been shown—and quite conclusively—with decades of data (that tax cuts do not spur economic growth). Moreover, seeing as how you’re dragging out the old government waste trope—its notable that you conveniently neglect to directly indict those on the receiving end of this “waste”. It cannot be solely the government’s fault that private corporate contractors happily pocket this waste. If waste is something you find especially onerous, shouldn’t we start by pointing the finger at the private companies who submit “wasteful” bids/invoices? If the government is paying too much and wasting public funds on contractors, doesn’t the fault lie with those submitting the bids/invoices? If there is nothing at all wrong with their bids, and we want to say it’s acceptable to bid any amount so long as the bidding is, say, fairly open to all comers, then how exactly can the government be guilty of “waste”? Seems every time the government is criticized for waste, it’s always a one-sided critique. Meanwhile, attempting to reign in this alleged waste with regulations, bid caps, stronger negotiating power, or some form of (gasp!) price control mechanism for public projects is rather uniformly met with charges of abuse of power, not playing by the rules, crippling free markets, or some other such nonsense. If there is waste, it starts with exorbitant bids/invoices for that $200 screwdriver. Seems to me the government is simply playing by the rules and paying what is demanded. There’d be a shit storm if they didn’t.

ksk 8y ago
>There aren’t even a preponderance of correlative data that shows a link between tax cuts and economic growth—except where economic growth is defined as a disproportionate increase in wealth concentration in ever smaller percentages of the population. I can re-define economic growth to mean the size of my checking account. Income inequality has its own definition. You re-defining it to mean something its not doesn't mean much. >Moreover, seeing as how you’re dragging out the old government waste trope Its not a trope. Your personal ideology might or might not allow you to recognize this. I would recommend keeping an open mind. >its notable that you conveniently neglect to directly indict those on the receiving end of this “waste”. Once you create the means for someone to obtain wealth, you cannot fault the individual for maximizing their gains under a capitalist system. Look, if you don't believe that the government does a very poor job of allocating resources, then our disconnect is large enough that realistically no consensus can be reached. The motivations of the people lobbying for their piece of the government pie only exist in a context where (1) people are greedy and (2) the government has tons of money to spend. We can't do anything about #1, but maybe something about #2. >The opposite has been shown—and quite conclusively—with decades of data (that tax cuts do not spur economic growth). Nothing of the sort has been conclusively demonstrated, primarily because macro economics deals with aggregate human behavior - and humans are not automations. To every example of a low-tax low-growth economy is a counter example of high-tax still low-growth economy.