Trickle-down theory doesn’t hold water
In his letter to the editor of June 15, Mr. Hougen states that high taxes and burdensome regulations prevent potential employers from hiring more people. I disagree. My husband and I own a small business, and our hiring decisions are based entirely on whether or not we have scheduled work to support more people. The people we hire are 1099 based, so there are no payroll taxes or employee benefits for us to pay. In addition, we are an “S” corporation, so we pay no corporate taxes. We are under no burdensome regulations, just a few simple quarterly reports that need to be filed.
The idea that employers are sitting on the sidelines with millions of jobs ready to be filled as soon as the “uncertainty” of higher taxes and deficit reduction is resolved is ridiculous. If it were true, why don’t we hear directly from these employers themselves?
Another thing the right likes to say is that we don’t have a revenue problem, we have a spending problem. The Ryan plan proposes drastic cuts to spending along with further reductions to the highest tax rates. I’m no economist, but I do know that cutting up my credit cards does nothing to pay off the balance I already owe. A plan to reduce the national debt cannot be considered serious unless it also includes an increase in revenue (taxes).
On a final note, we’ve been through this “trickle-down” theory of prosperity before. It was popularized by Reagan, and it was called out as “voodoo economics” by Bush Sr. The idea is that by lowering taxes, rich people will have so much money, some of it will fall out of their pockets for the rest of us to pick up. But today’s version of “trickle down” includes a scare tactic that we will lose even more jobs if the rich are not allowed to get even richer. There is not just a lack of compassion going on here; we’re being played for suckers too.
Hougen’s lesson in economics is full of holes
Letter writer Darrell Hougen wants to teach “those on the left” a lesson in economics. His lesson is, the wealthy give us miserable middle-class dopes our jobs, and that if we want them to continue to do so, we should continue blessing them with the lowest federal tax rates in the last half-century.
If voodoo economics ever did work, it hasn’t been since the Federal Reserve started making voodoo money. We stupid leftists can at least remember 10 years ago. The economy, after Clinton, was purring along fairly well. Unemployment was about 3 percent. And we were actually paying down the national debt!
Then Bushenomics took over. A massive income tax cut favoring the wealthy; an ill-advised expensive war; another huge income tax cut favoring the wealthy; an expensive war of imperialism; and an expensive subsidy to big pharm, disguised as an unfunded Medicare prescription drug entitlement. And don’t forget the massive capital gains tax cuts favoring Cheney and the hedge fund operators.
So did the wealthy create jobs for us middle-class slobs with all that money awash in our economy? I don’t think so! They invested (gambled) with hedge funds, securitized debt, credit default swaps and derivatives.
So my lesson to the plutocrats is, when we find ourselves in a hole, the first thing to do is quit digging!
Mike H. Ogan