Barack Obama and Supply-Side Economics

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In a perfect world with ethical businessmen and pro-American executives we would be able to trust corporations and give huge tax cuts. We should be able to give big tax breaks but should also have an expectation to see that money pay us back. But...unless you've been in a coma...huge corps have made their huge wealth in America on American backs with American money from American consumers but rather than pay back America with tax cuts such as the Bush tax cuts, they took that money and bought foreign labor, foreign real estate and hid profits into foriegn tax shelters essentially shafting the America that made them who they are. Americans aren't the consumers. American incomes are the consumers. Dropping, stagnant or eliminated incomes kill consumers in turn killing the very corps that think it's wise to invest and spend in foriegn lands. High corp taxes are simply a way to force the money to stay in America rather than let the execs ship it across borders. Nobody, democrat or republican, want high taxes for anybody but only the democrats seem to be thinking realistically and long term big picture and the republicans seem to want to continue to "trust" execs to do the right thing. Your philosophy is exactly what we want but we have nobody ethical and trustworthy enough to do it. There is simply too much demand on corp execs to turn exorbinate profits from stockholders so execs will burn their own family to deliver to hold that million dollar per year job.

Greg of CO 5:58PM January 11, 2009

Pethokoukis seems fundamentally incapable of understanding that tax policies have different effects when the economy is contracting as opposed to expanding. Cutting the capital gains tax would be effective? Did you not notice the epic financial panic last year? Remember, it's a capital GAINS tax.
And FYI, "conservative economists" aren't the same thing as "supply-side economists." Greg Mankiw is a conservative economist, and he famously called supply-side economists "cranks and charlatans." There's a reason no one respects supply-siders.
Learn a lot of economics in Journalism School, did you?
This blog should be called Happy Meal Economics, because Pethokoukis has all the economic sophistication of a college freshman in Econ 101.

Nick of NY 7:37PM January 09, 2009

Pethokoukis seems fundamentally incapable of understanding that tax policies have different effects when the economy is contracting as opposed to expanding. Cutting the capital gains tax would be effective? Did you not notice the epic financial panic last year? Remember, it's a capital GAINS tax.
And FYI, "conservative economists" aren't the same thing as "supply-side economists." Greg Mankiw is a conservative economist, and he famously called supply-side economists "cranks and charlatans." There's a reason no one respects supply-siders.
Learn a lot of economics in Journalism School, did you?
This blog should be called Happy Meal Economics, because Pethokoukis has all the economic sophistication of a college freshman in Econ 101.

Nick of NY 7:37PM January 09, 2009

Maybe, just maybe, the GDP has fallen because business goes over-seas to find more corporate friendly environments. When business goes over-seas, jobs go, too. How exactly is giving people on Main Street going to get those businesses back? How is giving me another $1000 going to stop out-sourcing to a cheaper vendor? Here's a wacky, off-the wall thought. Why don't we lower the corporate tax, the capital gains tax, and all the red tape for businesses and make America a business friendly environment? I know that sounds radical. Instead of countries loaning us money up the wazoo, maybe foreign companies could invest here instead with factories and jobs. Crazy, huh? What am I saying, those almost sound like capitalist ideas. Oops, sorry, lost my head for a minute.

Steph of WY 6:40PM January 09, 2009

I love you being president I bet you will help us get out of debt because you want your girls to have a happy life.

Mia Neilly of OH 9:14AM January 09, 2009

They are charged with passing effective legislation, in consideration of what the administration proposes, but not rubber stamping what the administration proposes.
And if this gets posted twice for some odd reason I cannot figure out, it probably deserves to be repeated.

HillbillyBill of TN 6:47AM January 09, 2009