I hesitate to put "thumbs down" in the title. Tell you why after the quote.
From page 4 of It’s Still the Economy, Stupid by Bill Clinton, under the heading 12. CUT CORPORATE TAXES:
I’d be perfectly fine with lowering the corporate tax rates, simplifying the tax code, and saving some money on accountants, but broadening the tax base so that all of them pay a reasonable amount of tax on their profits... Lower the rates to be competitive, but reduce the loopholes that cause unfair disparities. We all need to contribute something to help meet our shared challenges and responsibilities, including solving the debt problem.
"...including solving the debt problem."
First of all, the heading is deceiving. Clinton wants to increase corporate taxes, not cut them. Now, I don't have a problem with that. But I do have a problem with hiding one's intent under a false heading.
Second, let's assume that raising corporate taxes will solve the problems that have arisen since we went over to the supply side. That doesn't mean it will solve the problems that arose in the 1970s, that drove us to the supply side.
Thumbs down.
7 comments:
We were never driven to the supply side. Reagan had a team that chose to take us there.
I remember an interview on the radio early in St. Ronnie's first term with somebody from the Nixon administration, re: supply side economics. His comment was, "We have no idea what these people are doing." There was a time when even Rethugs had some semblance of reality in their outlook.
Cheers!
JzB
"We were never driven to the supply side."
(Hope you got the Star Wars "dark side" parallel I tried to create.)
Try this:
...That doesn't mean it will solve the problems that arose in the 1970s, which drove us away from Keynesian economics and created an opportunity that your 'rethugs' seized.
(Reaganomics was well-loved in the 1980s, I should point out. Reagan-love lingers yet today.)
My point is, there were problems in the 1970s. Inflation. Stagflation. And -- from a golden-age perspective -- the end of growth that accompanied with the 1974 recession. That was probably the straw that broke the camel's back.
There were problems with the economy in the 1970s, despite Krugman's denial of it. And yours.
This is a difference between us that I would like to work out.
I don't recall seeing that Krugman article, though I agree with it complely.
Neither of us has ever denied that there were problems in the 70's. Where did you get that idea?
I trace all of our current problems back to where i can find an inflection point on a graph of some measurable resultant. These always occur between about 1974 and 1986.
Reagan did not ause everything, but he caused a lot, and he absolutely made everything worse.
This is a difference between us that I would like to work out.
Is this a start?
Cheers!
JzB
I don't have time for this... SOME of us have to work, you know... but:
I see the whole Reaganomics thing as a "solution" to the problems of the 1970s. I think it was presented that way at the time. I'm not looking at ulterior motives or anything like that.
Anyway, if there were problems in the '70s (particularly stagflation, which remains the problem to this day) then if we take back all the changes of Reaganomics (including some by Jimmy Carter) then we are still left with those original problems.
Those are the problems that have to be solved. The rest of it is just bad solutions. I think, if the original problems are explained, everything else falls into place.
I have no time either.
So let's get started!
The problem of the 70's was stagflation, and no economic theory was equipped to handle it. You'll hear people say that this refutes Keynes, which is bullshit, and they omit that if it were to refute Keynes, it would refute all of classical economics as well.
Inflation went through a bubble. The bubble burst. Reaganomics offered no solutions, it was shit that people made up. The only theoretical basis was a sketch Laffer made on Cheney's cocktail napkin. You see no ulterior motive - I see a dedicated plan to begin the destruction of the middle class.
If there is any credit to begin for defeating inflation, it belongs to Volker, not Reagan. Though it's possible that the trend might have simply been over.
Rehearsal. Gotta run.
Cheers!
JzB
"The problem of the 70's was stagflation..."
And it is still the first result problem, today. What we call unemployment? Stagnation. What we call low, stable inflation? Inflation. Continuous, both, since the 1970s.
"You'll hear people say that this refutes Keynes, which is bullshit..." [and]
"Reagan did not cause everything, but he caused a lot, and he absolutely made everything worse."
You don't have to convince me of these things. Like you, I have seen it for myself. Where we differ is in the way we deal with it.
"You see no ulterior motive"
Didn't say I don't see it. Said I'm not looking at it.
"If there is any credit to begin for defeating inflation, it belongs to Volker..."
Yeh, PK said that in "Did The Postwar System Fail?" ...But the problem is not inflation. The problem is stagflation: inflation and stagnation *both*. It is easy to solve inflation OR stagnation. But no one has yet solved inflation AND stagnation. I hope to get credit for solving it...
I see Reaganomics as an attempt to solve the economic problems that arose in the 1970s. I think, if we want to replace Reaganomics, we need to show not only that it made things worse, but also that we have a better solution to the problem that Reaganomics was created to solve.
The trouble I have with Krugman is, he rejects Reaganomics and embraces Keynesian economics, which (true or not) is associated in people's minds with stagflation and the failure of the postwar system. Krugman offers nothing new.
Krugman doesn't need to offer anything new.
Cheers!
JzB
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