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1. Giant tax cut, inflationary 2. Giant tax cut, inflationary 3. Without corresponding tax increase or cuts elsewhere, inflationary Taxes are the last reason
by scottLobster 4y ago
1. Giant tax cut, inflationary
2. Giant tax cut, inflationary
3. Without corresponding tax increase or cuts elsewhere, inflationary
Taxes are the last reason people don't have enough in retirement. If you only have 100k saved up in a traditional 401k, and say you're doing pretty well in the 22% income tax bracket overall so that over time gets taxed down to 78k, over the course of a 20 year retirement that's just $1100.00/year in taxes. That's what, a few weeks' groceries? Taking those taxes away by contrast will be extremely inflationary and lead to people losing more money to inflation than they saved in taxes.
- danielrpa 4y agoStating that tax cuts are inflationary assumes that the government is able to put the money to better use than individuals. Have in mind that when the government taxes your money, it also spends it - but instead of spending in productive pursuits, it often spends it in a way that doesn't lead to increase production and, thus, inflation.
- scottLobster 4y agoNo, it's assuming whatever the government does with it won't cause a generalized inflation spike. Let's say the government wastes all the tax revenue building a next-generation aircraft carrier that's so incompetently constructed it collapses in drydock before it can ever set sail. That won't cause the price of everything to go through the roof, except perhaps locally where the money is spent. And actually, the government can often put the money to better use than individuals. Is there incompetence, corruption, and wasteful government spending? Of course. But two things can be true at the same time. I'd like to see an individual try to build a bridge, repair a road, or open a public school off of their tax savings.