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Politics : Mainstream Politics and Economics -- Ignore unavailable to you. Want to Upgrade?

To: koan who wrote (50550)	8/10/2013 2:34:07 PM
From: sm1th	1 Recommendation Recommended By i-node Read Replies (1) \| Respond to of 85487

We had sky high taxes in the 50's and 60's and corporations did just fine as did everyone else. I suppose that the boom of the 50s and 60s had nothing to do with the destruction of the rest of the industrialized world in the 40s? In the absence of competition, even badly run, over taxed companies can charge enough to survive. American companies must now compete in a global economy. The govt shouldn't put them at a disadvantage and expect them not to respond.

To: koan who wrote (50550)	8/10/2013 2:35:23 PM
From: average joe	Respond to of 85487

You are sooo stupid.

To: koan who wrote (50550)	8/10/2013 3:06:00 PM
From: TimF	2 Recommendations Recommended By i-node sm1th Read Replies (1) \| Respond to of 85487

Look in to the economics terms "margin", "at the margin". You seem to lack understanding of them. Economic effects are rarely on and off switches, but you post as if they where. Otherwise you wouldn't keep arguing (or at least not honestly arguing) that some factor can't be bad, because when it was a bigger deal the overall picture wasn't so bad. "Things where ok with higher tax rates", does not suggest "higher tax rates are not bad". You don't utterly destroy investment with a tax increase, you discourage it. If other factors are very positive you can still get high and not too severely distorted investment. But even then investment is lower, and more distorted then it would be with lower tax rates. The effect can sometimes be small, at least in the short run, but again economic growth compounds on itself and a small difference over time becomes a big difference. sm1th already mentioned the highly competitive position industry in the US was in. Also you had a lot less government regulation getting in the way of growth. And demographics where more favorable for strong growth (mainly that the population was younger) Things were OK back then, we had strong (if erratic) economic growth. But with those conditions growth could have been even stronger. High tax rates where one of the reasons it was not. Also taxes where easier to avoid back then, and the actual tax take as a percentage of GDP was similar not much higher. The high rates (and the efforts to avoid them) created negative distortions, but the government wasn't really grabbing a bigger piece of the pie. Beyond taxes, it was borrowing less (or at times paying down debt). The real burden of the government is spending, because both taxes and borrowing pull money towards the government and borrowing has to be paid back later, and spending was lower.