The President Thinks We Need To Pay More

Econintersect has the article The President Thinks We Need To Pay More.

This is a good article with one tremendous flaw.

And if weak demand at home is keeping unemployment too high or wages too low, the appropriate policy response is fiscal relaxation- either a tax cut or spending increase- and not to tax or otherwise drive up the cost of imports, even if that results in a higher public debt.

Cutting taxes allows people to spend the money on whatever they want including creating a bubble in the stock market.

There are some things that are for the good of society collectively including business interests that are not a profitable investment for individuals nor corporations. These are the things we depend on our government to buy for the collective good.

When you put tax cuts on a completely equal footing as investment spending for the common good, you are leaving out a very important part of the picture.

When you hear that tired old saw complaint by the Republicans that “you know how to spend your money better than the government does”, remember what I said above. You will be able to retort, “There are some things I want my government to spend on because the country and the economy needs them, but it makes no sense for individuals to pay for them only voluntarily”.

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