ERD50
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
You are conflating long term and short term issues.
I thought I addressed the short term separately, perhaps I wasn't clear.
You can create any product you want, but unless people have the money to buy it IT HAS NO VALUE. You can't create value if buyers have no money.
We have a vast number of unemployed people who, if properly employed would create products. Similarly if those people had money they would buy other peoples products. You can't start a car without a battery.
True, and I don't think this is contrary to what I posted. But part of what I'm saying is we can't just create products for consumption - there has to be some real value-added there to be sustainable.
So let's say we give everyone a $500 debit card each month for a period of time. They can buy 'stuff', and some of that stuff will need to be replaced and that will create jobs. But take away the $500/month and doesn't it all go 'poof'? I don't see how you create more than $500 worth of jobs on $500 of sales of consumables. Using your battery/car analogy, where does the gasoline come from once the car is started? Sounds to me like you are saying you can charge the battery from turning the engine with the starting motor - perpetual motion machines don't work.
OTOH, if you are producing product that creates value (say tools that allow a business to make something of greater value out of lesser value base commodities), that seems like sustainable growth to me.
Hypothetical example for illustration: Say I develop a $20 widget that can save $50 on this seasons heating bill. Great payback, real value-added there. Sure, some people are living so paycheck-to-paycheck that they can't even afford the $20 to save $50. But (judging by the packed higher-end restaurants I've been to recently), many people can. That will create jobs for the widget makers. Maybe then they can afford the $20 to save $50? It seems to me that those are the kinds of products we need to be producing for sustainable growth.
This is what bothers me the most about both the Dem and GOP extension proposals -- they are permanent.
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One thing that troubles me in the various discussion of 'tax those who can afford it' is it just seems so backwards to me. It's like going to the grocery store and having the checkout person decide your bill based on how much money you have in your wallet.
I don't think we should take more just because one group decides another group can afford it, we should have to justify the expenditures and then figure out a reasonably fair was to collect what we need. I won't comment beyond that, as I don't really know where we are on the Laffer curve - are taxes on the 'rich' hurting investment more than than they collect? I have no idea - it's an effect at any level of taxation, but I don't know where the inflection point is. If we knew that, we could decide if a flatter or steeper curve was in order. But the stats I've seen already seem very tilted to a small % of the upper levels paying a very high % of FIT already. Maybe that's how it should be, but maybe not?
-ERD50