Some wisdom from Michael Linden:
I really feel like a lot of people never grappled with the fact that in 2017 Congress enacted a massive corporate tax cut, including a 14 point cut in the marginal rate and it had no discernible positive effect on the macro economy.
— Michael Linden (@MichaelSLinden) April 2, 2021
Quite so. For example:
Still, it's not fair to say the tax cut had no effect on the economy:
Want more? I recommend my very thorough look at the Republican tax cut here. It is literally true that the tax cut did absolutely nothing that Republicans had promised before they passed it. Nothing.
"It is literally true that the tax cut did absolutely nothing that Republicans had promised before they passed it. Nothing."
Ah, but as Republicans will perversely claim - Can you imagine how much worse things would be without the tax cuts?
Honestly, of course they didn't. Because the fundamental motivator for it was "I want more money" and the people who wanted it got it. And the voters who didn't get tax breaks have bought into a grander notion that taxes are bad for growth and in general, just bad. Those terrible baby-killing liberals who constantly harass them and call them names want it, so it must be bad.
Ideology and associations rule here, not empiricism.
I mean really, since when were the GOP's public promises reflective of their private desires? Their governing philosophy is "make the currently wealthy and powerful more wealthy and powerful". That's not a great vote getter, hence public promises that are always unfulfilled. On consideration though, that's nt really fair. A lot of members of the party really are racists and religious fanatics, so when they make promises about punishing people that are not straight, white, Christian males, you can usually take that at face value.
Again, dialectical nonsense. Christianity is at the base of reform liberals Zionism is zionism. Most of the Republican party is the party of zionism. You simply refuse to admit it.
We don't need the bigotry, why is it here?
Yeah, this nazi needs to be ignored.
Christian zionism is zionism.
First off, thanks, KD, for using the measure ’real per-capita GNP’. That is the simplest measure to show that there is at least the potential to improve everyone’s economic situation (obviously distribution still matters).
Real per-capita increases in GNP are almost entirely due to technological advancements which are the product of R&D. US businesses are investing too little in R&D, and government funding for research has also been lagging. Business found union-busting and global labor and environmental arbitrage to be more remunerative than investing as though there might actually be a future. Too much of government has been controlled by Republicans, who care little about 99% of the present generation and 100% of future ones.
Possibly, but I think that is because growth is dying. Listen, capitalism struggled up until 1870. Malnutrition, food shortages and supply lines were a consistent feature. Industrialization and mechanization helped spur capitalism into the illusion that it worked. Debt is the basis of capitalism and debt=a whole lot of growth for 100 years between 1879-1973(2000, though the mini-debt bubbles that would foretell the future were starting with real structural growth falling). That growth slowly and not over night, ended malnutrition, food shortages and supply lines by 1950(some on the food science part of it, went too far and made a bunch of fat people, which is true lol).
The problem is, capitalism is still capitalism. The debt has to go somewhere to keep the money changers casino from crashing. If debt has no place, then you get leverage and functions of state that serve to increase debt so the whole ponzi scheme becomes softer and exposed to huge shocks. Right now, we are 1.7% growth. That is as much as we should be able to grow within just the population. R&D spending is down because they are out of ideas. I look at the Rock music life cycle, there are only so many cords to pluck and only so many melodies that can be made. Eventually it will die out.
“R&D spending is down because they are out of ideas. ”
Baloney.
Businesses are out of ideas because R&D spending is down.
Pharmaceutical companies just created and tested multiple vaccines for a pandemic virus in less than a year, because the Federal Government insured them against loss. As dumb as American M.B.A.’s are, they know free money when they see it.
They are outsourcing everything.
And the Republicans hate the colleges and universities.
Correction: Republicans hate colleges/universities that don't supply them. But if they do, life friends
It accomplished everything the GOP's rich donors wanted, and more. Through a pandemic, the rich got even richer, after all.
The tax cut was expected to do nothing as corporations clearly didn't need the money. Before the tax cut corporations were swimming in cash.
If there was a credit crunch and profits were low then perhaps an argument could have been made for a tax cut. As it was, I believe that most of the tax cut benefits went to the shareholders (buy backs) and executives.
Regarding R&D spending being down, I'd like to see statistics on that. I can't speak for corporations overall, but certainly some are making huge investments. Apple, Google, automotive companies and others are spending like crazy and their R&D budgets are increasing. There is a lot of investment in making better semiconductors, better batteries, probably many other things that I don't follow.
There are lots of ideas for new technologies. If anything, we are seeing a boom in improved technology. The newest iPhone costs under a dollar a year to charge and performs like a supercomputer from decades ago. 4K flat panel displays are getting cheaper. LED lights cost a few dollars, last years, and use much less power than incandescents. AirPods carry a small UNIX computer in each ear. These are technically huge developments that took years of R&D investment to accomplish. Gigabit fiber optic internet is becoming common. That is way better than the dial up modems we used to use. Biotech is not my area but they have been making huge strides as well. You can argue whether these are useful contributions or not, but these didn't come out of thin air.
The problem is that the wealthy have figured out how to keep most of the benefits of improved productivity.
Pingback: Tax Cuts do little for economic growth part ad nauseam – For A More Perfect Union