🚀 go-pugleaf

In article <1992Aug27.043330.11723@pony.Ingres.COM>, garrett@Ingres.COM
(QUOTE OF THE YEAR) writes:
|>
|> 
|> 	All these theories, and yet not a single person saw a 
|> correlation between the tax cuts and the following recessions. Amazing.
|> Well, I'm going to advance a theory that I am sure everyone will 
|> disagree with, on both sides. Here goes...
|> 
|> 	The government cuts taxes, therefore allowing more money
|> to circulate in the economy. Hence, economic growth.

The reduction of taxes WILL impact the amount of circulatable money,
but it doesn't necessitate economic growth.  Why?  Not all people
spend their money.  Some save it.  Why else?  People may be in debt
and are paying down the debt.  Interest is not really a produced good
in the same sense as a car or bike.  Paying off interest doesn't
necessitate growth.  Why else?  Foreign competition.  Who is to say
that the extra cash will go to domestic production?

|> 
|> 	That's right, someone with no economic schooling has just
|> put an inflamitory post that will be sure to anger every red-blooded
|> American. So start flaming.
|>
 
I think you have plenty of economic schooling --you're a consumer, producer
and probably and investor and owner.  Why are you trying to anger people?
Why don't you just make your point.  Is it that tax cuts eventually lead
to recession?  The problem with the argument is that we don't know how
long to wait in order for it to be considered 'eventually'.  If you were
to say within k years after a tax cut, there will be a recession, that 
would be more solid, but your choice of k would probably be a result of
looking BACKWARD at the data and choosing a convenient k, one that allowed
you to make your assertion.

Paul Collacchi