??

Exactly. More cashflow increases aggregate demand which stimulates supply and everything's hunky-dorey again.

But the key question is, what are the best policies for increasing cashflow?

That's pretty simple, too. The best policies for stimulating an economy are policies that put money in the hands of those who will immediatly spend it. Like low and middle class people. Like the unemployed.

Not the rich--yuppies swapping stock doesn't do a whole lot for increasing cashflow. According to Mark Zandi at Economy.com:

"[High income earners] are substantially less likely to spend any tax savings quickly than lower and middle income households. An estimated less than one-half of any tax benefit to households with incomes above the median are spent within one-year of receiving the benefit. This compares to nearly 90% for households with incomes below the median."

Zandi assigns an estimate of how much GDP increases for each dollar spent on stimulus (or lost in tax revenue).

Extend Federal Unemployment Benefits-----1.73
10% Personal Income Tax Bracket ---------1.34
State Government Aid---------------------1.24
Child Tax Credit Rebate--------------------1.04
Marriage Tax Penalty----------------------0.74
Alternative Minimum Tax Adjustments------0.67
Personal Marginal Tax Rate Reductions-----0.59
Business Investment Writeoff--------------0.24
Dividend-Capital Gain Tax Reduction-------0.09
Estate Tax Reduction---------------------0.00
source (pdf)

The three most effective policies for stimulating the economy are all focused on low income or needy individuals: extending federal unemployment benefits, reducing the lowest tax bracket, and state aid (which is targetted at the needy).
Another plus to these policies is that they are also temporary (except for the 10 percent bracket), whereas less effective and hugely costly policies like tax cuts for the rich are permanent--once the economy has recovered, extending unemployment benefits can end. But Bush's tax cuts keep ballooning the deficit, year after year after year, long after the economy no longer needs that stimulus.

Since this is all so simple, why did the Bushies largely refuse to select the most effective, temporary, and least costly measures? Because those policies run counter to conservative ideology.

Pretty simple, really--ideology trumps reality.

Anyway, since we're possibly approaching a period of recession, we may need to choose policies to deal with it. This time around, could we please choose policies that make economic sense?

"This year's numbers show that both the income share earned by the top 1 percent and the tax share paid by the top 1 percent have reached all-time highs. In 2005, the top 1 percent of tax returns paid 39.4 percent of all federal individual income taxes and earned 21.2 percent of adjusted gross income, both of which are significantly higher than 2004 when the top 1 percent earned 19 percent of AGI and paid 36.9 percent of federal individual income taxes."

http://www.taxfoundation.org/news/show/250.html

When the bottom 50% of wage earners only pay 3% of all taxes, please explain to me how there can be any meaningful tax cut for them...please.

I suppose would could go ahead and eliminate what is left of that 3% and have this group pay 0% of federal income tax. So that adds back 3% capital to be spent, which, of course it will be.

Then what? No property tax? No sales tax?

Then you seem genuinely surprised that the 'rich' try and shelter (legally) some of their 36.9%.

Actually it's been 35%, not 36.9, since 2001. That's half of what it was some forty years ago. At what point should we start expecting the rich to not be criminals?

You have ignored the most effective policies for stimulating the economy, which are not tax cuts.

What in hell does that mean?


http://www.usnews.com/usnews/politics/bulletin/bulletin_071217.htm

Fortunately, Bush has kept the Dems from spending all they wanted. Still to much, though.

Yes, thank god for your hero, George W Bush.
Without him we wouldn't be spending hundreds of billions of dollars and thousands of lives in a pointless, unnecessary war against a nation that had nothing to do with 9/11.
Without him we might still have budget surplusses.
Without him we might still be admired in the world.
Without him we might have a Justice Department dedicated to...oh, I don't know...justice?

Without him our nation's future might still be bright.

No you didn't. My post explained what economic stimulus policies were most effective and why. Since the two most effective policies don't even involve taxes, how do your charts on WHO pays taxes apply to my post?

Address my post and then I'll be happy to answer your question, which is really quite simple.

Do you have anything to offer that includes getting people back on their feet and not just a handout? Is there anything in your plan that promotes people making their own way and not just taking from one group and giving it to another?

Do you have any data to support the idea that this plan would work?

You should see from my charts that the 'reducing the lowest tax bracket' has little to no effect.

Your system has been tried and has failed miserably. Paying people to not work is a ridiculous. Clinton signed welfare reform after vetoing it twice. Finally, Morris convinced Clinton that it would help his poll numbers so he got on board. It has gotten people back to work with great success and OFF the government dole.

Did you not learn ANYTHING from that?