…persistent deficits and continually mounting debt would have several negative economic consequences for the United States. Some of those consequences would arise gradually: A growing portion of people’s savings would go to purchase government debt rather than toward investments in productive capital goods such as factories and computers; that “crowding out” of investment would lead to lower output and incomes than would otherwise occur. …a growing level of federal debt would also increase the probability of a sudden fiscal crisis, during which investors would lose confidence in the government’s ability to manage its budget, and the government would thereby lose its ability to borrow at affordable rates. …If the United States encountered a fiscal crisis, the abrupt rise in interest rates would reflect investors’ fears that the government would renege on the terms of its existing debt or that it would increase the supply of money to finance its activities or pay creditors and thereby boost inflation.
Archive for July 31st, 2010
Posted in Big Government, CBO, Congress, Debt, Deficit, Economics, Fiscal Policy, Government Spending, Health Care, Health Reform, Higher Taxes, Hypocrisy, JCT, Jobs, Joint Committee on Taxation, Keynes, Keynesian, Laffer Curve, Obama, Spending, stimulus, Supply-side economics, Taxation, tagged CBO, Congressional Budget Office, Debt, Deficits, Dynamic Scoring, Fiscal Policy, Government-run healthcare, Hypocrisy, JCT, Joint Committee on Taxation, Keynes, Keynesian Economics, Laffer Curve, Obamacare, stimulus on July 31, 2010 | 6 Comments »
Posted in Class warfare, Competitiveness, Economics, Fiscal Policy, Higher Taxes, Jobs, Obama, Supply-side economics, Tax Increase, Taxation, tagged Competitiveness, Economic growth, Higher Taxes, Jobs, Obama, Tax Increases, Tax rates, Taxation on July 31, 2010 | 10 Comments »
Results indicate that lower tax rates are associated with more favorable economic activity, including growth in GDP, lower unemployment, and higher savings. These findings suggest that at the micro-level, corporate managers should consider tax rates when deciding to locate or not locate business operations within a given country, especially if the goal is to locate where the economy is dynamic. At the macro-level, before making changes to tax law, policy makers should carefully consider how tax rates affect economic activity. For example, policy makers in the US Congress, at the time of this writing, are considering whether to allow the Bush tax cuts to expire in 2010. If the Congress allows that to happen, the outcome would effectively be the largest tax increase in US history.
The Prince of Wales says he believes he has been placed on Earth as future King ‘for a purpose’ – to save the world. Giving a fascinating insight into his view of his inherited wealth and influence, he said: ‘I can only somehow imagine that I find myself being born into this position for a purpose. ‘I don’t want my grandchildren or yours to come along and say to me, “Why the hell didn’t you come and do something about this? You knew what the problem was”. That is what motivates me. ‘I wanted to express something in the outer world that I feel inside… We seem to have lost that understanding of the whole of nature and the universe as a living entity.’ His impassioned comments come during a film about his belief that unbridled commerce has led to the destruction of farmland and countryside. …But the Prince has previously come under fire for hypocrisy over his eco-values. Last year he commandeered a jet belonging to the Queen’s Flight to attend the Copenhagen climate change summit, generating an estimated 6.4 tons of carbon dioxide – 5.2 tons more than if he had used a commercial plane. …Graham Smith, of the anti-monarchy group Republic, said: ‘He is under the impression he has been sent to save the world and deliver us from our sins. It’s quite delusional.