Re: "no sense."
What the famous economist meant when he said 'a tax cut without spending cuts is only a deferred tax increase', is that there IS NO FREE LUNCH.
Just as families and corporations must balance their budgets (if they run in the red too long they go bankrupt), so too must even great nations.
Cutting taxes is good, but if that leaves a semi-permanent structural imbalance in the government's books (if they are running major deficits out as far as anyone can see), then they MUST ALSO CUT SPENDING OR THE ENTIRE HOUSE OF CARDS COLLAPSES, AND ALL THE GOOD FROM THE LOWERED TAXES IS LOST.
The GAO, the CBO (and even the private econometrics firm the White House hired to estimate future growth --- using the newest 'dynamic scoring' method for modeling economics that always ASSUMES that lower taxes will produce more growth and ultimately more revenue to the government --- back when they were trying to sell their proposed tax cuts to Congress), came up with the same results:
Unless the massive deficit spending is sharply reduced, ALL the beneficial effects of the lower tax rates will be OVERCOME and eliminated somewhere between 5 and 7 years out, by the harm deficits will bring.
Just because a government has a printing press, and can print all the paper money they want to, doesn't mean that they can get away with running huge deficits FOREVER.
If deficits aren't reduced/eliminated then the worst tax of all lands on the backs of the nation's people and businesses: uncontrolled inflation.
Inflation is the 'secret tax' that politicians love the most --- because they never have to record a vote for it. (But inflation moves people into higher tax brackets, at the same time it depresses growth and forces interest rates higher.) |
