The Bush tax cuts, dollar for dollar, are an inefficient means to an economic strategy. High-income earners tend to save their discretionary income at a much higher rate---i.e., as a percentage---compared to those who earn less than they do.
The potential receipts earned as a consequence of allowing the Bush tax cuts expire could go directly towards reducing the deficit without requiring cuts to something as essential as Medicare, upon which so many Americans depend.
If medical services are reduced, do you think that the average American is going to eagerly dig into their own pocket to make up for the difference? Not likely. Especially not lower income earners. And if they do need to make up for the difference, the money has to come from somewhere, namely, existing discretionary spending. Cuts to Medicare could very well lead to money simply shifting from one area to the next, with a net effect of money evaporating from the economy.
What's more is you're going to have public health consequences. Absenteeism has an impact on the economy. If Americans can't get the health services they require in a timely manner---or at all---this will have further negative consequences.
Letting the Bush tax cuts expire make sense. It's fiscally responsible and they were intended to be temporary anyway. All they really do for top earners is fill their coffers. Dollar for dollar, economic stimulus works harder the lower the money flows down the economic hierarchy. And we all know that it isn't going to trickle down as Reaganites would have us believe.
I think it's time to return to Clintonomics and the Third Way. At least there is a track record of it actually working. And this is something that both Democrats and (reasonable) Republicans can get on board for.
---------- Post added at 10:20 PM ---------- Previous post was at 10:16 PM ----------
Quote:
Originally Posted by Wandrin
I won't believe any budget is serious until it begins to make cuts to the parts of the "defense" budget that have nothing whatsoever to do with actual defense.
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Yes, this included. Both Bush, Sr., and Clinton made cuts to the military. It's totally possible.