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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (303887)	9/21/2006 5:34:36 PM
From: TimF	Read Replies (2) \| Respond to of 1573717

re: If the government spends money, it generally isn't good for the economy. Better tell that to the defense, software, road building etc. industries. Taxing the money does hurt the economy, as does borrowing it, at least when you are just talking about the direct effects. Indirectly infrastructure like roads is needed, and while a lot of the spending is pork, some of it is important. Defense can be considered mostly a dead weight on the economy, but obviously some level of defense spending is necessary. You call it "perverse" incentives but most people believe there can be positive incentives in the tax codes. Taxes on liquor, cigarettes, gambling, and gasoline are examples. "Sin taxes", and gasoline taxes, can in certain ways be considered positive (as long as they aren't so high as to encourage smuggling and black markets). OTOH they still are government attempts to control people's actions. Whether they are really a net positive is more than just an economic issue. A lot of taxes have more directly perverse incentives. People invest money to shelter it from taxes rather than to produce the best risk adjusted rate of return. People also spend a lot of money to comply with or figure out ways around taxes.