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Study Finds Trump Tax Cuts Failed to Do Anything But Give Rich People Money

KLATTU said:
Another lw zombie meme, endlessly parroted by by liberal economic illiterates.

It presumes something really stupid. That shareholder who receive the buyback funds do not put the funds they receive to productive use. According to the left, they presumably stuff it into mattresses. {LAFFRIOT}
Click to expand...

No, when a company uses a tax cut windfall, and buys back their shares on the stock exchanges to retire shares, thus driving down supply of their outstanding shares, and driving up earnings per share, etc. those who sold shares on the stock exchanges probably used the proceeds from the stock they sold to buy more stocks, which is good for stocks!

It doesn't do much for wages or purchasing power for ordinary Americans, but if your point is the rich, who own the VAST majority of corporate stock, were made richer, that's precisely what liberals think happened.
 
KLATTU said:
Another lw zombie meme, endlessly parroted by by liberal economic illiterates.

It presumes something really stupid. That shareholder who receive the buyback funds do not put the funds they receive to productive use. According to the left, they presumably stuff it into mattresses. {LAFFRIOT}
Click to expand...
Since half the capital gains is earned by the top one percent, and half of that the top 0.1%, I think it doesn’t go to productive use. That’s confirmed by no additional investment after the tax cuts went into effect.
 
JasperL said:
No, when a company uses a tax cut windfall, and buys back their shares on the stock exchanges to retire shares, thus driving down supply of their outstanding shares, and driving up earnings per share, etc. those who sold shares on the stock exchanges probably used the proceeds from the stock they sold to buy more stocks, which is good for stocks!

It doesn't do much for wages or purchasing power for ordinary Americans, but if your point is the rich, who own the VAST majority of corporate stock, were made richer, that's precisely what liberals think happened.
Click to expand...

yet this
The U.S. added 263,000 new hires in April, easily beating Wall Street expectations of 190,000.
The unemployment rate fell to 3.6% vs. 3.8% expected and the lowest since December 1969.
Average hourly earnings in April were 3.2 percent higher than a year earlier, the ninth straight month in which growth topped 3 percent, the Labor Department reported Friday.

Now maybe google something by Krugman or Reich where they " explain" why NONE of that was a result of a tax cut{ Laffriot }
 
MTAtech said:
Since half the capital gains is earned by the top one percent, and half of that the top 0.1%, I think it doesn’t go to productive use. That’s confirmed by no additional investment after the tax cuts went into effect.
Click to expand...

yet this
The U.S. added 263,000 new hires in April, easily beating Wall Street expectations of 190,000.
The unemployment rate fell to 3.6% vs. 3.8% expected and the lowest since December 1969.
Average hourly earnings in April were 3.2 percent higher than a year earlier, the ninth straight month in which growth topped 3 percent, the Labor Department reported Friday.

Now maybe google something by Krugman or Reich where they " explain" why NONE of that was a result of a tax cut{ Laffriot }
 
KLATTU said:
yet this
The U.S. added 263,000 new hires in April, easily beating Wall Street expectations of 190,000.
The unemployment rate fell to 3.6% vs. 3.8% expected and the lowest since December 1969.
Average hourly earnings in April were 3.2 percent higher than a year earlier, the ninth straight month in which growth topped 3 percent, the Labor Department reported Friday.

Now maybe google something by Krugman or Reich where they " explain" why NONE of that was a result of a tax cut{ Laffriot }
Click to expand...

{ Laffriot }

How much of the impact is due to the $trillion Keynesian stimulus of borrowed money being pumped into the economy per year?

Or, we can phrase the question a different way. If we cut spending by a $trillion, what impact would that policy decision have on economic growth?

If you can't answer those questions, you can't really assert what the impact of the tax cuts, lower rates, were on economic growth. Econ 101.
 
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JasperL said:
{ Laffriot }

How much of the impact is due to the $trillion Keynesian stimulus of borrowed money being pumped into the economy per year?

Or, we can phrase the question a different way. If we cut spending by a $trillion, what impact would that policy decision have on economic growth?


I
If you can't answer those questions, you can't really assert what the impact of the tax cuts, lower rates, were on economic growth. Econ 101.
Click to expand...

OF course that can't be known. Only guessed, inferentially.


but look at the title of the OP:
Study Finds Trump Tax Cuts Failed to Do Anything But Give Rich People Money

"Failed to do ANYTHING....

When somebody makes an absolute statement like that, they are not to be taken seriously .

do you think it's reasonable to assert that NONE of the wage growth and job creation was attributable to lower taxes?
 
KLATTU said:
OF course that can't be known. Only guessed, inferentially.

but look at the title of the OP:
Study Finds Trump Tax Cuts Failed to Do Anything But Give Rich People Money

"Failed to do ANYTHING....

When somebody makes an absolute statement like that, they are not to be taken seriously .

do you think it's reasonable to assert that NONE of the wage growth and job creation was attributable to lower taxes?
Click to expand...

The short answer is I do not know. No doubt the stimulus of lowering taxes, and borrowing every penny of it, was a stimulus short term. If the IRS cut checks worth $200 billion/year to all the poor people, and did it for 5-10 years, and everyone knew it would continue for 5-10 years, there would be an economic boost. Same with tax cuts that increase deficits by roughly $200 billion per year in the first 5 years. It's "free money" dumped into the economy.

My guess is that lower rates DO boost investment, etc. because at lower tax rates, the after-tax return on a given investment goes up. But the evidence is that's a minor player in economic growth, especially when the tax cuts are borrowed. Obviously lower rates that are sustainable over time will absolutely boost growth, but these tax cuts are not sustainable, given that we're projected to see $trillion deficits AT FULL EMPLOYMENT so I don't know how the analysis/es would shake out.
 
Good grief. This was a matter of common sense even back then:

- The tax-cut was publicly declared to be permanent for the wealthy and only temporary for the Middle-Class. The average conservatives cheered anyway.

- After greatly reducing government revenue, the GOP significantly increased government spending. The average conservatives shrugged.

- New taxes were introduced to supplement that lost government revenue, making the tax-cut to the Middle-Class just silly. The average conservatives shrugged.

* Significant reduction in government revenue + significant increase in government spending = ?!

So what happens when the tax-cuts for the middle-Class expire? The increase in government debt needs attention. Just don't bother the wealthy with that equation. Their tax-cuts were permanent. It's not their problem. And in the meantime, conservatives want the government to buy walls.

Even before this we could clearly see the agenda. Trump inherited the ongoing trend of economic improvement and unemployment rates. He literally had to do nothing. His rolling back of Obama-era environmental protectionist Orders went directly to feed the captains of industry, while the average conservatives swooned over the deliciousness of tribal victory over "the left." Yet, this was only a temporary B-12 shot to an already good and improving economy. Despite the tax-cuts, corporations have continued to lay people off by the thousands (while unemployment rates remain low), even more so as this trade war continues. And lay-offs are good for stock holders who are always looking to cut costs while increasing revenue. We know from history that tax-cuts are not an incentive to expand; customers are. Add this and other examples to the shameless permanent tax-cuts to the wealthy, and we can clearly see Trump's focus on increasing the wealth of his own kind.

The average conservatives shrugs.
 
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KLATTU said:
yet this
The U.S. added 263,000 new hires in April, easily beating Wall Street expectations of 190,000.
The unemployment rate fell to 3.6% vs. 3.8% expected and the lowest since December 1969.
Average hourly earnings in April were 3.2 percent higher than a year earlier, the ninth straight month in which growth topped 3 percent, the Labor Department reported Friday.

Now maybe google something by Krugman or Reich where they " explain" why NONE of that was a result of a tax cut{ Laffriot }
Click to expand...

What I read above is tying two events and presuming causality between the two. It's a logically fallacy.

Your thesis, such as it is, is that the tax-cuts are responsible for April 2019's 263,000 gain in employment. To test that theory, we should look at other April periods where there were no tax-cuts. 2014 and 2015 fit that bill. Job gains in those two Aprils were 327,000 and 300,000, respectively. Thus, if we had periods of greater job gains when there were no tax-cuts, it's illogical to credit tax-cuts for the 2019 gains.

Moreover, the unemployment rate has been dropping for ten years, not just after taxes were cut.
 
JasperL said:
The short answer is I do not know. No doubt the stimulus of lowering taxes, and borrowing every penny of it, was a stimulus short term. If the IRS cut checks worth $200 billion/year to all the poor people, and did it for 5-10 years, and everyone knew it would continue for 5-10 years, there would be an economic boost. Same with tax cuts that increase deficits by roughly $200 billion per year in the first 5 years. It's "free money" dumped into the economy.

My guess is that lower rates DO boost investment, etc. because at lower tax rates, the after-tax return on a given investment goes up. But the evidence is that's a minor player in economic growth, especially when the tax cuts are borrowed. Obviously lower rates that are sustainable over time will absolutely boost growth, but these tax cuts are not sustainable, given that we're projected to see $trillion deficits AT FULL EMPLOYMENT so I don't know how the analysis/es would shake out.
Click to expand...

Actually, high tax rates encourage investment, not low tax-rates. Why you ask? Because business spending on new plant and equipment is tax deductible. The higher the tax-rate, the more the deduction lowers corporate taxes.
 
JasperL said:
No, when a company uses a tax cut windfall, and buys back their shares on the stock exchanges to retire shares, thus driving down supply of their outstanding shares, and driving up earnings per share, etc. those who sold shares on the stock exchanges probably used the proceeds from the stock they sold to buy more stocks, which is good for stocks!

It doesn't do much for wages or purchasing power for ordinary Americans, but if your point is the rich, who own the VAST majority of corporate stock, were made richer, that's precisely what liberals think happened.
Click to expand...

what is the "VAST" majority of which you speak?

can you quantify that statement?

The accompanying graph details the "distribution of stock ownership by wealth percentile," specifically 84 percent for the "top 10 percent," 9.3 percent for the "next 10 percent" and 6.7 percent for the "bottom 80 percent."

The data in the graph stems from a peer-reviewed academic paper. However, when we took a closer look, we found the data in the graph doesn’t directly support the claim that "most Americans don’t own stocks." In fact, the actual data on that question shows that a small majority of Americans do have a stake in the stock market.

What percentage of Americans own stocks? | PolitiFact California

401k plans, and etfs...along with discount brokers have made owning stocks easier and easier

and the MAJORITY of people have some ownership.....

do i wish it were more? yep....

but when we begged employees to contribute and even matched up to 5%...and they say they cant afford to participate?

you cant join the wealthy without ever starting to save and acquire wealth
 
gdgyva said:
what is the "VAST" majority of which you speak?

can you quantify that statement?

The accompanying graph details the "distribution of stock ownership by wealth percentile," specifically 84 percent for the "top 10 percent," 9.3 percent for the "next 10 percent" and 6.7 percent for the "bottom 80 percent."
Click to expand...

That sounds about right. If you object to "vast majority" that's fine, but 84% to the top 10% seems like the "vast" majority to me.

The data in the graph stems from a peer-reviewed academic paper. However, when we took a closer look, we found the data in the graph doesn’t directly support the claim that "most Americans don’t own stocks." In fact, the actual data on that question shows that a small majority of Americans do have a stake in the stock market.

What percentage of Americans own stocks? | PolitiFact California
Click to expand...

Right, I've seen that data which is why I didn't make the claim addressed by Politifact.

401k plans, and etfs...along with discount brokers have made owning stocks easier and easier

and the MAJORITY of people have some ownership.....

do i wish it were more? yep....

but when we begged employees to contribute and even matched up to 5%...and they say they cant afford to participate?

you cant join the wealthy without ever starting to save and acquire wealth
Click to expand...

OK, fine, I agree. The point was that 84% of the benefit of stock buybacks go, according to your data, to the top 10% in the form of higher share values.
 
JasperL said:
That sounds about right. If you object to "vast majority" that's fine, but 84% to the top 10% seems like the "vast" majority to me.



Right, I've seen that data which is why I didn't make the claim addressed by Politifact.



OK, fine, I agree. The point was that 84% of the benefit of stock buybacks go, according to your data, to the top 10% in the form of higher share values.
Click to expand...

my assistant who earned 33k a year...was one of those i guess in your 10%

she had been with the company for 42 years.....and in the plan since its inception....putting 7 1/2 % away each and every paycheck

she got a few nice profit sharing boosts....and a few nice longevity boosts along the way, and presto, she has over 2 million sitting in her 401k now

yes...the top 10% own more stocks...because they invest, and reinvest, and keep doing the same things over and over

you cant become one of them unless you participate....
 
gdgyva said:
my assistant who earned 33k a year...was one of those i guess in your 10%

she had been with the company for 42 years.....and in the plan since its inception....putting 7 1/2 % away each and every paycheck

she got a few nice profit sharing boosts....and a few nice longevity boosts along the way, and presto, she has over 2 million sitting in her 401k now

yes...the top 10% own more stocks...because they invest, and reinvest, and keep doing the same things over and over

you cant become one of them unless you participate....
Click to expand...

I'm not sure why you're telling me this. I'm a tax accountant and former investment advisor. I've recounted stories like that probably 100s of times to tax clients and investment clients. My wife and I save over 40% of our income each year, and max out every tax advantaged way to save available to us, plus put some into our taxable account. We paid off our house a decade ago, and don't have any debt. We buy cars for cash.

None of that has anything to do with my point. If we want to use tax policy to boost the stock market, let's make share buybacks deductible, or maybe allow tax deductions for dividends. I'm sure there are other direct ways to use the government to prop up the stock market, other than the many ways we already do so, like the Fed serving as the buyer of last resort in any crash or serious downfall. But if that's what we WANT tax policy to do - boost share prices for my family and that secretary and Warren Buffett, let's be honest about it and not claim that corporations or wealthy business owners will use tax windfalls to boost hiring or boost wages or create jobs, etc.
 
jimbo said:
The Intelligencer doesn't even pretend to be non biased.

Nothing to see here.
Click to expand...

They're describing a report by CRS, the Congressional Research Service. You can read about who they are here:

About EveryCRSReport.com
- EveryCRSReport.com

E.g.

CRS is Congress’ think tank, and its reports are relied upon by academics, businesses, judges, policy advocates, students, librarians, journalists, and policymakers for accurate and timely analysis of important policy issues.
Click to expand...
 
jimbo said:
The Intelligencer doesn't even pretend to be non biased.

Nothing to see here.
Click to expand...
How about the Tax Policy Center? A New Congressional Study Finds Little Economic Benefit From The 2017 Tax Cuts and the Congressional Research Service?

[FONT=&quot]A new [/FONT]Congressional Research Service report[FONT=&quot] finds that the 2017 Tax Cuts and Jobs Act had little measurable effect on the overall US economy in 2018. And, no, the tax cuts didn’t come remotely close to paying for themselves by turbocharging the economy as President Trump repeatedly promised. This was a surprise to few, since most independent analysts predicted more than a year ago that the law would have little economic impact.[/FONT]
Click to expand...
 
MSgt said:
Good grief. This was a matter of common sense even back then:

- The tax-cut was publicly declared to be permanent for the wealthy and only temporary for the Middle-Class. The average conservatives cheered anyway.

- After greatly reducing government revenue, the GOP significantly increased government spending. The average conservatives shrugged.

- New taxes were introduced to supplement that lost government revenue, making the tax-cut to the Middle-Class just silly. The average conservatives shrugged.

* Significant reduction in government revenue + significant increase in government spending = ?!

So what happens when the tax-cuts for the middle-Class expire? The increase in government debt needs attention. Just don't bother the wealthy with that equation. Their tax-cuts were permanent. It's not their problem. And in the meantime, conservatives want the government to buy walls.

Even before this we could clearly see the agenda. Trump inherited the ongoing trend of economic improvement and unemployment rates. He literally had to do nothing. His rolling back of Obama-era environmental protectionist Orders went directly to feed the captains of industry, while the average conservatives swooned over the deliciousness of tribal victory over "the left." Yet, this was only a temporary B-12 shot to an already good and improving economy. Despite the tax-cuts, corporations have continued to lay people off by the thousands (while unemployment rates remain low), even more so as this trade war continues. And lay-offs are good for stock holders who are always looking to cut costs while increasing revenue. We know from history that tax-cuts are not an incentive to expand; customers are. Add this and other examples to the shameless permanent tax-cuts to the wealthy, and we can clearly see Trump's focus on increasing the wealth of his own kind.

The average conservatives shrugs.
Click to expand...

A very accurate assessment. Your post shows exactly why there is so much income disparity in this country.
 
MTAtech said:
What I read above is tying two events and presuming causality between the two. It's a logically fallacy.

Your thesis, such as it is, is that the tax-cuts are responsible for April 2019's 263,000 gain in employment. To test that theory, we should look at other April periods where there were no tax-cuts. 2014 and 2015 fit that bill. Job gains in those two Aprils were 327,000 and 300,000, respectively. Thus, if we had periods of greater job gains when there were no tax-cuts, it's illogical to credit tax-cuts for the 2019 gains.
t.
Click to expand...



Not at all. It was only to refute your assertion that the tax cuts did "nothing".
I didn't credited the gains in April 2019 to tax cuts. That would be absurd. It would be equally absurd to say none of them were due to the tax cut.

By the way interesting that you cherry picked 2014 and 2015, and not 2016 ,2017 and 2018 . Sounds suspicioulsy like a case where you came to to the conclusion FIRST and then tried to back fill it with facts. That usually goes awry as it did in this case.

in 2016 the number was 160,000 . In 2017 it was 211,000 and in 18 it was 164,000. All of sudden it jumped up to 263,000.
Sounds like the economy was slowing down.
The tax cut went into effect jan. 1 ,2018.

Sounds like you could make a case that they were responsible for some job creation, no?

MTAtech said:
W



Moreover, the unemployment rate has been dropping for ten years, not just after taxes were cut.
Click to expand...

and maybe that was just cyclical growth ,aided by the Bush tax cut ( still in effect during Obama's 8 years with minor tweaks)

Or it could have been Keynesian stimulus. We'll never really know.
 
KLATTU said:
Not at all. It was only to refute your assertion that the tax cuts did "nothing".
I didn't credited the gains in April 2019 to tax cuts. That would be absurd. It would be equally absurd to say none of them were due to the tax cut.

By the way interesting that you cherry picked 2014 and 2015, and not 2016 ,2017 and 2018 . Sounds suspicioulsy like a case where you came to to the conclusion FIRST and then tried to back fill it with facts. That usually goes awry as it did in this case.

in 2016 the number was 160,000 . In 2017 it was 211,000 and in 18 it was 164,000. All of sudden it jumped up to 263,000.
Sounds like the economy was slowing down.
The tax cut went into effect jan. 1 ,2018.

Sounds like you could make a case that they were responsible for some job creation, no?



and maybe that was just cyclical growth ,aided by the Bush tax cut ( still in effect during Obama's 8 years with minor tweaks)

Or it could have been Keynesian stimulus. We'll never really know.
Click to expand...

We3ll, according to the report:
In 2018, gross domestic product (GDP) grew at 2.9%, about the Congressional Budget Office’s (CBO’s) projected rate published in 2017 before the tax cut. On the whole, the growth effects tend to show a relatively small (if any) first-year effect on the economy. Although growth rates cannot indicate the tax cut’s effects on GDP, they tend to rule out very large effects particularly in the short run. Although investment grew significantly, the growth patterns for different types of assets do not appear to be consistent with the direction and size of the supply-side incentive effects one would expect from the tax changes. This potential outcome may raise questions about how much longer-run growth will result from the tax revision.
Click to expand...
The way I read this report is that we lowered taxes on the richest among us, we didn't get much growth out of it, and we have a big deficit bill to pay.
 
KLATTU said:
Not at all. It was only to refute your assertion that the tax cuts did "nothing".
I didn't credited the gains in April 2019 to tax cuts. That would be absurd. It would be equally absurd to say none of them were due to the tax cut.

By the way interesting that you cherry picked 2014 and 2015, and not 2016 ,2017 and 2018 . Sounds suspicioulsy like a case where you came to to the conclusion FIRST and then tried to back fill it with facts. That usually goes awry as it did in this case.

in 2016 the number was 160,000 . In 2017 it was 211,000 and in 18 it was 164,000. All of sudden it jumped up to 263,000.
Sounds like the economy was slowing down.
The tax cut went into effect jan. 1 ,2018.

Sounds like you could make a case that they were responsible for some job creation, no?



and maybe that was just cyclical growth ,aided by the Bush tax cut ( still in effect during Obama's 8 years with minor tweaks)

Or it could have been Keynesian stimulus. We'll never really know.
Click to expand...

The trouble with the job growth is that they are low-paying jobs - many part-time without benefits. No, MTA is correct with the title of this thread.

America's job problem: Low-wage work is growing fastest - CBS News

The country is projected to add almost 8 million jobs through 2022, representing 5 percent growth, according to a new study from CareerBuilder. Even though that represents a positive trend, the findings raise major red flags: Low-wage jobs are expected to grow the fastest, while middle-wage work will continue to decline.
 
Media_Truth said:
The trouble with the job growth is that they are low-paying jobs - many part-time without benefits. No, MTA is correct with the title of this thread.

America's job problem: Low-wage work is growing fastest - CBS News

The country is projected to add almost 8 million jobs through 2022, representing 5 percent growth, according to a new study from CareerBuilder. Even though that represents a positive trend, the findings raise major red flags: Low-wage jobs are expected to grow the fastest, while middle-wage work will continue to decline.
Click to expand...

Not according to the article you posted. 8 of the 10 jobs listed pay above $24.65 an hour.
1. Personal care aides (16 percent growth): $10.89 per hour

2. Home health aides (16 percent): $11.25

3. Web developers (15 percent): $30.75

4. Nurse practitioners (14 percent): $50.14

5. Physical therapists (12 percent): $41.57

6. Industrial machinery mechanics (12 percent): $24.65

7. Computer systems analysts (12 percent): $43.04


8. Software developers (11 percent): $50.03

9. Market research analysts (11 percent): $31.52

10. Personal financial advisers (10 percent): 43.87
 
Warren's wealth tax makes sense and helps every American with the exception of the top 1 tenth of 1 percent.

How anyone can fight against this is abject and pathetic.
 
Obscurity said:
Warren's wealth tax makes sense and helps every American with the exception of the top 1 tenth of 1 percent.

How anyone can fight against this is abject and pathetic.
Click to expand...

Yep, because the beauty of democracy is that the majority (those below $X in income or $Y net worth) can vote to give themselves a "fair share" of the income and/or net worth of others (via taxation) and, of course, exempt themselves (from such taxation).
 
Obscurity said:
Warren's wealth tax makes sense and helps every American with the exception of the top 1 tenth of 1 percent.

How anyone can fight against this is abject and pathetic.
Click to expand...

Would every American be forced to list every item they own along with its value. Then list all debt to come up with a net wealth? How would someone with a pension value it. Should someone have to present value the income stream over the person's remaining life? Should the same b true for those collecting social security and Medicare. If you truly want a fair wealth tax then the answer to the above must be yes.
 
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