5 ms·

It's almost like you are encouraging supply side economics... aka... trickle down We need to massively cut corporate taxes, investment taxes, regulations, and

It's almost like you are encouraging supply side economics... aka... trickle down We need to massively cut corporate taxes, investment taxes, regulations, and all manner of things to increase supply. The government has been attacking business for so long we are in quite the hole.

waythenewsgoes 4y ago
This doesn't work, when we tried this most recently all it did was increase stock buybacks by large corps. It's just effectively a wealth transfer to those already at the top of the food chain.
- bronco21016 4y ago
  This exactly. Look at airlines. They lit tens of billions on fire in stock buy backs rather than pouring it into their businesses from 2015-2020. Who got the first corporate handouts when COVID decimated travel? Individual actors will act in their best interest according to the incentive structure in place.
  - landemva 4y ago
    USA handouts of money to airlines and foreign cruise ship operators was disgusting. Americans are soft and didn't do anything about it.
CoffeeCollector 4y ago
You are getting down voted for telling the truth. Every inflation discussion starts with the supply side economics or companies raising taxes, but inflation only happens in reality because of government spending, borrowing, and deficit spending.
- sandworm101 4y ago
  Inflation happens too in markets without governments. Government therefore cannot be the one cause.
  - CoffeeCollector 4y ago
    What markets exist outside of government authority? No, black and gray markets don’t count because the increased money supplies created by governments will affect the overall amount of money chasing goods in any market.
- d4mi3n 4y ago
  > but inflation only happens in reality because of government spending, borrowing, and deficit spending. This is incorrect. Note that governments around the world are also experiencing record levels of inflation and each has their own fiscal policy. Inflation is an aggregate economic effect driven by a variety of factors—including but by no means limited to government spending. Other things that contribute to inflation: 1. Supply shortages 2. Cost of living 3. Abundance of capital (low interest rates, high wages, etc) 4. Speculation Basically anything that contributes to groups of people assigning a higher value to the same set of goods or services. Supply is the most immediately noticeable cause and COVID has disrupted supply chains for some time. It is entirely unsurprising we've seen inflation as a result. Government policy has certainly played a part, but blaming everything on government spending is misleading in that ignores the larger realities of inflation beyond the borders of any nation state.
  - CoffeeCollector 4y ago
    Most of your ‘refutation’ is dishonest, Keynesian, MMT nonsense. Fiat doesn’t get introduced unless printed or borrowed by the government. Full stop. Companies raising prices is not inflation and conflating that with government monetary policy is outright disinformation.
    - kelnos 4y ago
      > Companies raising prices is not inflation Given that we base inflation numbers on CPI, inflation exactly is companies raising prices -- well, companies that produce the goods that are included in CPI, anyway. Yes, we still have to consider the reasoning behind why they are raising prices. Personally, I believe it is more because of supply chain shortages than COVID fiscal policy (though the latter certainly contributes), but I agree that's up for debate.
      - CoffeeCollector 4y ago
        > Personally, I believe it is more because of supply chain shortages Why?
    - 4y ago
mint2 4y ago
Err quite the opposite, recently corporate profits are at highs because part of the inflation has been price gouging. and they can do that because of lax regulations around mergers among other things
- seibelj 4y ago
  I'm a huge fan of so-called "price gouging". Without the ability to increase prices the shelves would be bare. This is what happens in all countries with price controls. You say price gouging, I say protecting society from itself.
  - trashtester 4y ago
    There are three alternativies when supply is short: 1) Increase prices until demand matches supply. 2) Price controls, usually leading to empty shelves. 3) Rationing. 1 is preferrable in 99% of cases. 2 is always the worst. 3 is needed during extraordinary times, such as when a country is in an all-out war.
    - 8note 4y ago
      1 is rationing too, just rationing to prioritize the wealthy. The more modern versions ration based on other things, like how to combat ticket scalping, bands release tickets through alternative means
      - trashtester 4y ago
        1 is the capitalist way while 3 is the socialist way to distribute goods. The first works best under normal market condition, as it encourages economic growth, while the latter works better under special conditions where the scarcity is severe, unavoidable and caused by temporary factors (such as a war).
  - mint2 4y ago
    There isn’t a shortage of many items that have had large price increases like oreos. There is no shortage on a lot of items but the companies see opportunity to raise prices at will in the current climate simply because they can
JamesBarney 4y ago
I think we should cut corporate taxes to match the rest of the world, but decreasing taxes will make inflation worse not better.
richbell 4y ago
> We need to massively cut corporate taxes, investment taxes, regulations, and all manner of things to increase supply. Supply is low due to a global pandemic disrupting trade (and far too many companies relying on 'just-in-time' logistics). "Massively [cutting] corporate taxes" won't do anything but bolster already soaring corporate profits. A significant amount of that money won't go back into the local economy. It also won't go to improving infrastructure, processes, employee salaries or anything that can improve resiliency or longevity; they've been penny-pinching for decades, and this is the result of it. Furthermore, 'inflation' of many necessities like grocery, gas, and rent is obviously driven by blatant profiteering.
- TurkishPoptart 4y ago
  How is the "pandemic" still disrupting trade? Wouldn't it be more accurate to say "governments' response to pandemic"? I.e. Shanghai's continued inhumane lockdowns by the CCP for political reasons.
badtoro 4y ago
Judging from the downvotes you get the level of understanding of 101 economics among the HN audience remains precariously low :-)
- richbell 4y ago
  Or people simply disagree with it. Economics is a Social Science and largely based on opinion, not fundamental properties of the universe. Racism is defined in many academic circles as "prejudice plus power". Are people 'wrong' if they disagree and think it ought to be defined differently?
- kelnos 4y ago
  How would slashing corporate taxes fix inflation? Corporate taxation encourages companies to reinvest into their own businesses: hiring more people, increased capex, etc. Cutting taxes just causes companies to either hoard cash, or return capital to shareholders through dividends or stock buybacks. Neither of these things helps the economy, or helps the average person; it's just wealth transfer from all taxpayers, to elites. Check out what airlines did in the last half of the last decade. Check out what kinds of companies benefited most from the COVID-related handouts, and see what they did with that money.
ClumsyPilot 4y ago
> We need to massively cut corporate taxes Why would we ever, ever need to cut corporate taxes? If a company re-invensts in equipment, it's workforce, research, or anything at all, they pay no tax. Tax is only applied when they transfer the money to shareholders. How will enabling corporations to transfer more money to already wealthy shareholders help the economy?

waythenewsgoes 4y ago

This doesn't work, when we tried this most recently all it did was increase stock buybacks by large corps. It's just effectively a wealth transfer to those already at the top of the food chain.

bronco21016 4y ago
This exactly. Look at airlines. They lit tens of billions on fire in stock buy backs rather than pouring it into their businesses from 2015-2020. Who got the first corporate handouts when COVID decimated travel? Individual actors will act in their best interest according to the incentive structure in place.
- landemva 4y ago
  USA handouts of money to airlines and foreign cruise ship operators was disgusting. Americans are soft and didn't do anything about it.

CoffeeCollector 4y ago

You are getting down voted for telling the truth. Every inflation discussion starts with the supply side economics or companies raising taxes, but inflation only happens in reality because of government spending, borrowing, and deficit spending.

sandworm101 4y ago
Inflation happens too in markets without governments. Government therefore cannot be the one cause.
- CoffeeCollector 4y ago
  What markets exist outside of government authority? No, black and gray markets don’t count because the increased money supplies created by governments will affect the overall amount of money chasing goods in any market.
d4mi3n 4y ago
> but inflation only happens in reality because of government spending, borrowing, and deficit spending. This is incorrect. Note that governments around the world are also experiencing record levels of inflation and each has their own fiscal policy. Inflation is an aggregate economic effect driven by a variety of factors—including but by no means limited to government spending. Other things that contribute to inflation: 1. Supply shortages 2. Cost of living 3. Abundance of capital (low interest rates, high wages, etc) 4. Speculation Basically anything that contributes to groups of people assigning a higher value to the same set of goods or services. Supply is the most immediately noticeable cause and COVID has disrupted supply chains for some time. It is entirely unsurprising we've seen inflation as a result. Government policy has certainly played a part, but blaming everything on government spending is misleading in that ignores the larger realities of inflation beyond the borders of any nation state.
- CoffeeCollector 4y ago
  Most of your ‘refutation’ is dishonest, Keynesian, MMT nonsense. Fiat doesn’t get introduced unless printed or borrowed by the government. Full stop. Companies raising prices is not inflation and conflating that with government monetary policy is outright disinformation.
  - kelnos 4y ago
    > Companies raising prices is not inflation Given that we base inflation numbers on CPI, inflation exactly is companies raising prices -- well, companies that produce the goods that are included in CPI, anyway. Yes, we still have to consider the reasoning behind why they are raising prices. Personally, I believe it is more because of supply chain shortages than COVID fiscal policy (though the latter certainly contributes), but I agree that's up for debate.
    - CoffeeCollector 4y ago
      > Personally, I believe it is more because of supply chain shortages Why?
  - 4y ago

mint2 4y ago

Err quite the opposite, recently corporate profits are at highs because part of the inflation has been price gouging. and they can do that because of lax regulations around mergers among other things

seibelj 4y ago
I'm a huge fan of so-called "price gouging". Without the ability to increase prices the shelves would be bare. This is what happens in all countries with price controls. You say price gouging, I say protecting society from itself.
- trashtester 4y ago
  There are three alternativies when supply is short: 1) Increase prices until demand matches supply. 2) Price controls, usually leading to empty shelves. 3) Rationing. 1 is preferrable in 99% of cases. 2 is always the worst. 3 is needed during extraordinary times, such as when a country is in an all-out war.
  - 8note 4y ago
    1 is rationing too, just rationing to prioritize the wealthy. The more modern versions ration based on other things, like how to combat ticket scalping, bands release tickets through alternative means
    - trashtester 4y ago
      1 is the capitalist way while 3 is the socialist way to distribute goods. The first works best under normal market condition, as it encourages economic growth, while the latter works better under special conditions where the scarcity is severe, unavoidable and caused by temporary factors (such as a war).
- mint2 4y ago
  There isn’t a shortage of many items that have had large price increases like oreos. There is no shortage on a lot of items but the companies see opportunity to raise prices at will in the current climate simply because they can

JamesBarney 4y ago

I think we should cut corporate taxes to match the rest of the world, but decreasing taxes will make inflation worse not better.

richbell 4y ago

> We need to massively cut corporate taxes, investment taxes, regulations, and all manner of things to increase supply. Supply is low due to a global pandemic disrupting trade (and far too many companies relying on 'just-in-time' logistics). "Massively [cutting] corporate taxes" won't do anything but bolster already soaring corporate profits. A significant amount of that money won't go back into the local economy. It also won't go to improving infrastructure, processes, employee salaries or anything that can improve resiliency or longevity; they've been penny-pinching for decades, and this is the result of it. Furthermore, 'inflation' of many necessities like grocery, gas, and rent is obviously driven by blatant profiteering.

TurkishPoptart 4y ago
How is the "pandemic" still disrupting trade? Wouldn't it be more accurate to say "governments' response to pandemic"? I.e. Shanghai's continued inhumane lockdowns by the CCP for political reasons.

badtoro 4y ago

Judging from the downvotes you get the level of understanding of 101 economics among the HN audience remains precariously low :-)

richbell 4y ago
Or people simply disagree with it. Economics is a Social Science and largely based on opinion, not fundamental properties of the universe. Racism is defined in many academic circles as "prejudice plus power". Are people 'wrong' if they disagree and think it ought to be defined differently?
kelnos 4y ago
How would slashing corporate taxes fix inflation? Corporate taxation encourages companies to reinvest into their own businesses: hiring more people, increased capex, etc. Cutting taxes just causes companies to either hoard cash, or return capital to shareholders through dividends or stock buybacks. Neither of these things helps the economy, or helps the average person; it's just wealth transfer from all taxpayers, to elites. Check out what airlines did in the last half of the last decade. Check out what kinds of companies benefited most from the COVID-related handouts, and see what they did with that money.

ClumsyPilot 4y ago

> We need to massively cut corporate taxes Why would we ever, ever need to cut corporate taxes? If a company re-invensts in equipment, it's workforce, research, or anything at all, they pay no tax. Tax is only applied when they transfer the money to shareholders. How will enabling corporations to transfer more money to already wealthy shareholders help the economy?