Tuesday, August 16, 2016

Simple Trickle.

       Ahh, those Republicans, they love their Trickle Down theory, don't they. And in all honesty, it could actually work exactly as advertised. After all, if you look at it through a microscope, it does appear to make perfect sense. If you allow the rich to have more money, through tax cuts, they can and will create more jobs. Why not? After all, more jobs mean more products available for sale which means more profits. It just requires a completely honest and trustworthy society.
       How could such a simple, straight forward approach to life not work? Simple. For starters, having more product to sell doesn't automatically mean it will sell. And if it doesn't sell, then the company is stuck with a backlog of inventory. And when that happens jobs get cut. Management knows this so they don't hire until they know there's a market. And that market doesn't magically appear because a rich guy got a tax break.
       And another thing. Just because a rich person gets a new tax break doesn't obligate that rich person to invest in new jobs. Maybe he'll invest in real estate or pork bellies or who knows what. Remember that new hires mean new and added headaches and require more and new raw materials at additional costs. Sometimes its just easier to send those savings offshore.
       And then those tax breaks come with a cost to government. Maybe those costs are offset by added revenue, but never fully and usually not at all, as proven by history. So there has to be an offsetting budget cut. Fewer services like education, social services, even military, when it comes to big cuts. Cuts to social services and education most severely hurt the poor and middle class.
       On the other hand tax cuts for the middle class spur spending for products causing inventory shortages requiring new jobs. To offset these tax cuts, tax increases on the wealthy are called for which will deliver a tax neutral policy. Its sort of a trickle up theory. History tells us it works. Republicans want us to trust in their complete honesty and trustworthiness. Democrats admit they nor the Republicans are fully honest and trustworthy. You choose. Tax cuts for you or the rich.

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