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View Diary: Clear line between middle class and wealthier = $113,700 (50 comments)

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  •  One of the tenants of New Deal tax policy (0+ / 0-)

    The EU does it, China does it.

    You equate paying taxes so we can build infrastructure, thats not very Keynesian. In fact its wrong, paying taxes specifically an income tax system that uses a geometric progression, progressive taxation, is essential in preventing large wage and income disparity. It prevents wealth concentration in the very few.

    Keynesian economics tells us to run deficits to pay for infrastructure, New Deal tax policy incentivized domestic investment, specifically stable long term shelters, an essential component of the post WW2 economy/boom that lasted until the Reagan era.

    Everyone else invests in America because it is a good place to invest and we do not have to bribe them to do it.
    That might have been true in the 50's and 60's, but since the mid 70's the US has been running annual trade deficits. While jobs have been outsourced.

    FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

    by Roger Fox on Sun Feb 10, 2013 at 05:55:15 PM PST

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    •  You make a good point, I guess we are bribing (1+ / 0-)
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      Roger Fox

      them, they invest our money by way of the trade deficit.  Keynesian economics doesn't say you always run deficits, it says you run deficits during economic downturns which unfortunately we have had a plethora of since Reagan.  Conservatives are shitty managers of the economy and banking system.

      •  Heres the jobs deficit-22-28 million jobs (0+ / 0-)

        Infrastructure has a multiplier of between 2 and 2.5. Good  paying manufacturing jobs a bit less 1.8 to 2.3.

        We used to spend 5-6% of GDP on infrastructure, today thats 750 to 900 billion, thats 15 million to 22.5 million jobs. In 2011 we spent 1.3%, just less than 200 billion or 4 to 5 million jobs.

        Roughly a net of 18 million jobs.

        WE used to use tax policy to incentivize domestic investment. I have never found solid numbers on this, but guessing, from 1.5% to 3.5% of GDP, call it 2.5%. Thats 375 billion or about 4 million jobs.

        Now, since Reagan every recession has a jobless recovery... DOH !......1990, 2000 & the current great recession.

        SO these old policies today would create about 22 million jobs. Assuming 28 million would take a full time year round job- and we create 22 million jobs, that leaves about 6 million people without jobs, about 4% unemployment @ a civilian workforce fo 154 million.

        My point being these New Deal policies match the current jobs deficit............ funny dat.....

        Keynesian economics doesn't say you always run deficits, it says you run deficits during economic downturns
        I misstated that. In economic downturns you deficit spend to stimulate. Right.

        FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

        by Roger Fox on Mon Feb 11, 2013 at 08:58:48 AM PST

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