Trickle down economics does not work

[Acanthus]

Glass - Steagal was repealed by Clinton.

Yup. It was.

 

[michal1980]

so obama giving big banks billions in zero interest loans is what if not trickle down economics?

 

[Jhhnn]

What caused the meltdown? Bush policies? Low taxes? No? Then shut the f*** up. (trying to be kinder and gentler) ()

Actually, it was Bush policy that led to the meltdown.

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Dubya's preaching the ownership society from the bully pulpit! He wants everybody to buy a house, and he wouldn't lie!

Here's the pitch, repeated many times-

http://www.youtube.com/watch?v=kNqQx7sjoS8

The denial among Righties as to the reasons for our current situation is utterly profound. They fail to recognize that it was the biggest class warfare scam in the history of finance, brought to us all by the Lootocracy & their cheerleaders in the Bush Admin.

 

[Acanthus]

so obama giving big banks billions in zero interest loans is what if not trickle down economics?

It is trying to avert a deflationary spiral.

 

[ShawnD1]

It is trying to avert a deflationary spiral.

That's bullshit and you know it. In Iceland, the government nationalized the banks, and then they forgave much of the debt. Instead of bailing out the banks, they bailed out the people who owed money to the banks. As a result, Iceland's recovery from the depression was much faster than the US and the rest of Europe. Since the US government didn't do a damn thing to help the middle class, lots of US families are still drowning in debt.

It's a real shame that corruption is so rampant in the US. It's starting to look more like Russia every day. Give a politician a hand job and he'll give trillions of tax dollars to your company. In Iceland, several bankers were thrown in jail.

 

[Juror No. 8]

It is trying to avert a deflationary spiral.

At least, that's what you've been told by the state comedian economists who got us into this mess in the first place.

 

[Jhhnn]

It is trying to avert a deflationary spiral.

That's bullshit and you know it. In Iceland, the government nationalized the banks, and then they forgave much of the debt. Instead of bailing out the banks, they bailed out the people who owed money to the banks. As a result, Iceland's recovery from the depression was much faster than the US and the rest of Europe. Since the US government didn't do a damn thing to help the middle class, lots of US families are still drowning in debt.

It's a real shame that corruption is so rampant in the US. It's starting to look more like Russia every day. Give a politician a hand job and he'll give trillions of tax dollars to your company. In Iceland, several bankers were thrown in jail.

In Iceland, they're socialists, and no socialist solution was getting past GWB or a Repub filibuster in the Senate, so bailout was the only constructive option.

What really set the Teahadists off were attempts at loan forgiveness, modifications, the idea that somebody else was getting something they weren't getting. That slammed hte door on that sort of effort, not to mention that Repubs have deliberately sabotaged recovery, hoping to Blame Obama! for hte mess their policy created.

That doesn't mean I like it, that just means we all have to deal with unpleasant realities.

 

[Matt1970]

Again, no Republican can come to the table with any facts or economic studies that back trickle down supply side economics.

I just want you to admit that the economic philosophy touted by your party simply doesn't work. And I want you to explain to me why, given the overwhelming evidence that it doesn't work, you think it will be different this time around if Romney becomes President? Answer this question without bringing up Democrats or liberals.

What evidence? The 80's and 90's were 2 of the best decades we ever had with the highest 20 year rise in GDP ever, or atleast in the last 100 years.

 

[Matt1970]

so obama giving big banks billions in zero interest loans is what if not trickle down economics?

And the auto bailouts and the stimulus was all trickle down economics.

 

[buckshot24]

What evidence? The 80's and 90's were 2 of the best decades we ever had with the highest 20 year rise in GDP ever, or atleast in the last 100 years.

It's because Clinton raised taxes, don't you know that yet?

 

[DucatiMonster696]

That's bullshit and you know it. In Iceland, the government nationalized the banks, and then they forgave much of the debt. Instead of bailing out the banks, they bailed out the people who owed money to the banks. As a result, Iceland's recovery from the depression was much faster than the US and the rest of Europe. Since the US government didn't do a damn thing to help the middle class, lots of US families are still drowning in debt.

It's a real shame that corruption is so rampant in the US. It's starting to look more like Russia every day. Give a politician a hand job and he'll give trillions of tax dollars to your company. In Iceland, several bankers were thrown in jail.

They may have nationalized their own banks but the most important aspect of their actions as you stated was that they did not bail out foreign banks who held a large share of toxic assets. So basically they allowed failure to occur which allowed for a reset in their economy. Of which was said reset was needed in order for a true recovery to occur. Of course this came at the cost to English bankers rather than Iceland's own banking system. However the point stands, without the threat failure being part of any economic system as whole you will end up with the mess we have here in the US and the mess we see in EU. In addition it is also essential to prevent the creation of false economic credit bubbles by government pushing out easy credit policies and manipulation of interest rates in which they entice banks to take risks in order to prop up government's own debt to prevent the cycle from occurring again in the future.

 

[Acanthus]

That's bullshit and you know it. In Iceland, the government nationalized the banks, and then they forgave much of the debt. Instead of bailing out the banks, they bailed out the people who owed money to the banks. As a result, Iceland's recovery from the depression was much faster than the US and the rest of Europe. Since the US government didn't do a damn thing to help the middle class, lots of US families are still drowning in debt.

It's a real shame that corruption is so rampant in the US. It's starting to look more like Russia every day. Give a politician a hand job and he'll give trillions of tax dollars to your company. In Iceland, several bankers were thrown in jail.

I agree that Iceland did it better. It is sad that we would rather bail out businesses than help citizens.

 

[Acanthus]

And the auto bailouts and the stimulus was all trickle down economics.

False.

The auto bailouts screwed over bond holders and stockholders in favor of saving 2-4 million american jobs.

It was the exact reverse of trickle down.

ARRA was partially trickle down, and was less effective because of it. Of the 700B spent, it was almost half tax cuts, which research has shown is one of the least effective forms of stimulus.

 

[Acanthus]

They may have nationalized their own banks but the most important aspect of their actions as you stated was that they did not bail out foreign banks who held a large share of toxic assets. So basically they allowed failure to occur which allowed for a reset in their economy. Of which was said reset was needed in order for a true recovery to occur. Of course this came at the cost to English bankers rather than Iceland's own banking system. However the point stands, without the threat failure being part of any economic system as whole you will end up with the mess we have here in the US and the mess we see in EU. In addition it is also essential to prevent the creation of false economic credit bubbles by government pushing out easy credit policies and manipulation of interest rates in which they entice banks to take risks in order to prop up government's own debt to prevent the cycle from occurring again in the future.

That is the other point, with no bailout there would have been a catastrophic failure within the banking system, mainly because of the horrifically stupid derivatives market. Iceland could afford to do it because they are tiny and wouldn't throw a multi-trillion dollar weight on the world GDP.

 

[michal1980]

False.

The auto bailouts screwed over bond holders and stockholders in favor of saving 2-4 million american jobs.

It was the exact reverse of trickle down.

you keep telling yourselves that

 

[Acanthus]

you keep telling yourselves that

Can you explain how it was trickle down economics?

How did banks make out on the deal? Investors?

Trickle down implies helping rich get / keep more money to benefit the economy as a whole.

 

[Exterous]

Hmmm...looks to me that this starts the minute they take office. I am pretty sure the AT P&N Democrats have determined that is not a valid comparison to make. We need one offset by 1-2 years

In case anyone cares - I took the S&P annual returns, grouped them by party and then offset them by 2 years. The results are significantly closer (not including Hoover)

Republicans: 11.15%
Democrats: 13.65%

My numbers are higher overall because a quick google search did not turn up results without dividends accounted for

 

[piasabird]

My study says that a high tax heavy borrowing, big government, Socialist style economics does not work.

 

[OneOfTheseDays]

Quality thread.

Thus far not a single Republican has produced any economic studies or otherwise viable data to prove that trickle down supply side economics actually works to increase economic growth.

Thanks for proving me right guys.

 

[piasabird]

Where is the study that big government social walfare being a system that does work?

Just look at France, Spain, Greece . . . .

 

[Veliko]

Where is the study that big government social walfare being a system that does work?

Just look at France, Spain, Greece . . . .

...Denmark, Germany, Sweden, Norway.

 

[Doc Savage Fan]

Quality thread.

Thus far not a single Republican has produced any economic studies or otherwise viable data to prove that trickle down supply side economics actually works to increase economic growth.

Thanks for proving me right guys.

If you recall, Reagan was elected during the country's worst recession since the Great Depression. Under Reaganomics, inflation dropped from 13.5 to 4.1 percent, unemployment dropped from 9.5 to 5.2 percent, jobs increased by almost 20 million, and median family income rose every year from 1982 to 1989. Reaganomics wasn't perfect but it brought us the greatest peacetime expansion in American history.

Here's a paper you might enjoy reading. I'm sure there are many more but my time is limited right now.

http://piketty.pse.ens.fr/files/Lucas1990.pdf

 

[lotus503]

If you recall, Reagan was elected during the country's worst recession since the Great Depression. Under Reaganomics, inflation dropped from 13.5 to 4.1 percent, unemployment dropped from 9.5 to 5.2 percent, jobs increased by almost 20 million, and median family income rose every year from 1982 to 1989. Reaganomics wasn't perfect but it brought us the greatest peacetime expansion in American history.

Here's a paper you might enjoy reading. I'm sure there are many more but my time is limited right now.

http://piketty.pse.ens.fr/files/Lucas1990.pdf

Yes and as I pointed out before this only happend because he borrowed a crazy amount of money from japan to outspend the soviets.

By the time that Ronald Reagan left office in 1988 the National Debt was 2.6 Trillion. Reagan more than doubled what all the previous presidents from Washington through Carter had accumulated in the prior 200 years.

Add the fact that he signed EITC into law which is the primary reason poor people owe no net fed taxes.

 

[Sureshot324]

The poor and middle class spend all their money (consumerism). The rich spend some and invest some, and the ultra rich invest most of it.

The more money you give to the rich, the more the investment/consumerism curve shifts towards investment. This doesn't really create jobs or stimulate the economy, but it does make things better (advances technology, increases efficiency).

Think of a farm in the early 1900s. If you lower the taxes of the wealthy farm owner, he can invest in a tractor. Now he'll probably fire some of his workers since his tractor can do the work of several men. However, food will become cheaper, people will have money for other things, and this will create other jobs.

On the other hand, if you lower taxes on the poor farm workers, they'll buy more food, which is good for them in the short term but doesn't result in any progress.

 

[lotus503]

The poor and middle class spend all their money (consumerism). The rich spend some and invest some, and the ultra rich invest most of it.

The more money you give to the rich, the more the investment/consumerism curve shifts towards investment. This doesn't really create jobs or stimulate the economy, but it does make things better (advances technology, increases efficiency).

Think of a farm in the early 1900s. If you lower the taxes of the wealthy farm owner, he can invest in a tractor. Now he'll probably fire some of his workers since his tractor can do the work of several men. However, food will become cheaper, people will have money for other things, and this will create other jobs.

On the other hand, if you lower taxes on the poor farm workers, they'll buy more food, which is good for them in the short term but doesn't result in any progress.

"The poor and middle class spend all their money (consumerism)."

do you think that would be the case without social engieering?