31 January 2010
Tax Cuts and Recovery
Robert Reich writes on Alternet.com today that instead of corporate tax cuts fiscal stimulus through public spending programs, particularly with transfers to State governments and Locales, is the way to maintain the momentum of the American recovery from its recession. He says that is one of the lessons we should have learned from John Maynard Keynes.
Something that has changed since Keynes is the importance of corporate profits to the wealth of consumers. This is a result of the growth of retirement and 401K plans. Therefore, reducing large corporations' taxes will affect the spending behavior of consumers in our economy and create increased demand. In our consumer economy, this is perhaps even more determinative of recovery than government spending.
Robert Reich writes on Alternet.com today that instead of corporate tax cuts fiscal stimulus through public spending programs, particularly with transfers to State governments and Locales, is the way to maintain the momentum of the American recovery from its recession. He says that is one of the lessons we should have learned from John Maynard Keynes.
Something that has changed since Keynes is the importance of corporate profits to the wealth of consumers. This is a result of the growth of retirement and 401K plans. Therefore, reducing large corporations' taxes will affect the spending behavior of consumers in our economy and create increased demand. In our consumer economy, this is perhaps even more determinative of recovery than government spending.
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