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Originally Posted by aceventura3
Just to give an example. Last year a jobs bill was passed, that gave a $5,000 tax credit to small business who hired someone who was unemployed. A virtual complete waste of tax dollars. A growing and profitable company in a position to hire people would hire them with or without the tax credit. The credit is of no value to a company that won't have a taxable profit. I understand and appreciate the intent of this tax loophole but from a big picture point of view a tax code full of stuff like this is simply ridiculous.
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How is this a loophole if it stipulates the hiring must be done from the pool of unemployed workers?
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I don't know the difference between the two.
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As one example, the Liberals do different things from the Democrats, but they're both liberal parties.
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True. I am thinking more in terms of maximizing growth and maximum efficiency in economic policy. Perfection can never be achieved, but constant movement to perfection should be the goal. It is very possible that Canada's economy operates more efficiently than the US economy. As discussed Canadian banking certainly operated better over the past few years through the "crisis". But one question could be that Canada sacrifices upside potential while being overly concerned with downside risks. Also, the cultures are very different. Canada is a country of few, very big banks, while the US is a country of a few very big banks and thousands of small regional banks and in the US the cumulative strength of the small banks may carry more influence than the big banks on our economy.
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It's difficult to compare our systems based on numbers and size of banks. This is mostly because our demographics are very different, yet our geography is comparable in terms of size. What you should know about our biggest banks is that despite their relative few number, they are very large in terms of our economy and they are highly profitable and consistently so. A "bad" quarter for one of our big banks means profits weren't as big as expected or fell short compared to competitors. This was even throughout the recession, when they were posting record-breaking profits. There hasn't been a bank failure in decades, and since
before the Great Depression there have been only two bank failures, and these included regional banks only.
However, this does little to speak to the Nordic model, which is based on a higher tax environment, extensive welfare programs, and low barriers to doing business. Canada isn't quite reflective of the Nordic model, but there are similarities. In principle the model aims to alleviate the burden of poverty through essentially guaranteed health care, education, and social security. While these things aren't necessarily "free" to all, they are for the most part either free or highly subsidized by the government.
What this does is create an economically stable public who are relatively unburdened by the risks associated with the cost of such things if they were only available through the private sector. This in combination with an ease of doing business is what allows for a high-tax environment with strong economic growth.
This is why the argument that cutting taxes is the only way to foster growth is false. Sure, cutting taxes in some strategies probably does foster growth, but cutting taxes isn't necessary for this to happen. This is demonstrated in a number of economies, especially the stronger ones employing the Nordic model. The difference is in the focus in terms of where the wealth lands. The top-down model has been revealed as a model that can fail. The bottom-up model has a number of success stories, and Canada is one of them.
---------- Post added at 12:40 PM ---------- Previous post was at 12:38 PM ----------
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Originally Posted by aceventura3
Tea Party people have frustrations with the Republican Party and that is the reason there is a Tea Party - otherwise it would just be the Republican Party. The Republican Party gave us McCain, an unacceptable choice. I know Obama and his supporters always want to conclude that is all about Obama, but it is not.
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My point is that I'm curious as to where the Tea Partiers were during George W. Bush's reckless spending and constitutional lapses. It would seem the Tea Partiers are more concerned with the guy who came in to clean up his messes.