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  1. #1
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    May 2007
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    Raising taxes hurts twice as much as cutting spending.

    In a study of 173 countries that adopted new procedures in attempts to reduce their deficits, "nations that mostly raised taxes suffered about twice as much as nations that mostly cut spending."

    http://econlog.econlib.org/archives/...hurts_mor.html

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  2. #2
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    May 2007
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    On the other hand, as it turns out, in situations like this, raising taxes may be a necessary evil!

    Here's why:

    When the government cuts taxes, it doesn't cut spending. "Starving the Beast," as the policy is called, doesn't work, because "the government has a credit card with no debt limit."

    A study by a pair of liberal economists in 2004 showed how thoroughly the desire to cut taxes had been made compatible with the desire to spend money and expand the government’s power. Among congressmen who had signed a pledge never to raise taxes, presumably on starve-the-beast grounds, more than 80 percent nevertheless voted for the mostly unfunded Medicare prescription drug benefit in 2003. More than 70 percent of them voted for the lard-packed farm and transportation bills in Bush’s first term.
    Public outrage, the other ingredient required in order to cause the government to cut spending, is non-existent. In order for there to be public outrage, you have to hit people in their wallets.

    When you make them pay for government benefits out of their own pockets, in other words, voters will want fewer of them. The journalist Jonathan Rauch put Niskanen’s point more pithily: “Voters will not shrink Big Government until they feel the pinch of its true cost.”
    http://www.weeklystandard.com/articl...st_663547.html

    Unfortunately, this means you have to pinch everybody, not just the rich. Could that happen? Can we get everyone to put some skin in the game?
    Last edited by Space Racer; 11-22-2012 at 12:53 PM.
    Vacuum Technology:
    CRUD = Contamination Resulting in Undesirable Deposits.
    CRAPP = Contamination Resulting in Additional Partial Pressure.

    Change your vacuum pump oil now.

    Test. Testing, 1,2,3.

  3. #3
    Join Date
    Jul 2007
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    New Jersey
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    3,031
    liberals will never understand, spending cuts leave extra revenue to work with

    no need to raise taxxes if you trim the fat (waste)

    also if regulations are loosened this allows for more jobs which equals extra revenue from employee taxxes

    no need to "pinch" the middle class during terrible economic times
    “If I have seen further than others, it is by standing upon the shoulders of giants.” ~ Sir Isaac Newton


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  4. #4
    Join Date
    Feb 2012
    Posts
    1,268
    Quote Originally Posted by Tommy1010 View Post
    liberals will never understand, spending cuts leave extra revenue to work with

    no need to raise taxxes if you trim the fat (waste)

    also if regulations are loosened this allows for more jobs which equals extra revenue from employee taxxes

    no need to "pinch" the middle class during terrible economic times
    I agree that government spending should go down, the problem is that our government is running a pyramid scheme that unfortunately will fail if we ever stop going into debt or stop printing money.

    This pyramid controls not only our economy but the world's...if it fails everything else will too.

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