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Politics : American Presidential Politics and foreign affairs -- Ignore unavailable to you. Want to Upgrade?

To: DuckTapeSunroof who wrote (45695)	9/7/2010 11:33:24 PM
From: TimF	Read Replies (1) \| Respond to of 71588

The post discussed the possibility of DIVERTING the Bush era tax cut that applied to the top marginal income rate, not to government spending programs but to lowering the other income tax rates! Exactly. And that was the point I addressed. Once again "Spending" != "government spending". When I talked about spending, it was not about government spending. It was about the idea (given as a reason to cut the taxes for the non-rich" that they would spend more. Its reasonably understandable that you missed this the first time, but treating "spending" as meaning "government spending" after your mistake was pointed out to you seems pretty obtuse. That diversion is supposed to be (at least partially) justified by the fact that "the poor spend more" (as a percentage of their total income. And it is indeed true that consumer spending represents a larger portion of the total income of the not rich, particularly the poor. But when your hoping to get a stimulus effect by cutting taxes on the less than rich (getting the money from the rich instead), then the total percentage of income that goes to consumer spending isn't a very important issue. Assuming that extra consumer spending will "stimulate" and generally help the economy (without that assumption we have a whole different conversation), the issue in terms of who you "divert the tax cuts to" to get the most spending from each dollar of tax cut is determined by the marginal propensity to spend an extra dollar under the current conditions, not by the overall percentage currently spent by each group.