Monday, November 3, 2008

Historical Economics

Every time taxes are lowered the economy grows. When taxes are raised the economy slows. Economies are not static they are dynamic. Most of the tax plan graphs show static statistics, they are misleading. You have to look at a dynamic graph for the real truth. But you don’t need to look at graphs and charts. All you have to do is look at history. Global history proves this time and again.

The best way to lower a deficit and balance a budget is to cut spending and lower taxes to increase economic growth and create jobs. If this is done the government actually gets more tax revenue than if they raise taxes. Doesn’t it make you wonder why so many politicians’ first reaction is to raise taxes? That will only slow the economy and actual tax revenue will decrease. History proves this over and over.

Obama’s economic tax plan raises many other rates on earners including dividends, capital gains, corporate, etc. This has been proven to slow the economy and cause the middle-class to make less and lose jobs. The tax cut he is giving is not enough to offset the negative slowing effect of the higher taxes on earners. This slowing effect is even more pronounced if instituted during a recession. History proves this time and again.

The more government takes and decides who and how much to give, because of their greed there will be nothing to give those that need. And sadly those that currently give on their own will have nothing to give either. History proves this time and again.

Government is corrupt. If its size increases it will be more corrupt. If it has more power and money it will be even more corrupt. The more money they take the less we get in return, and the more oppressive the government will be. Government is full of elected and appointed democrats and republicans. Corruption is non-partisan. Government is the ultimate monopoly. Global history proves this time and again.

The gulf between the poor and rich will widen even more under Obama’s tax plan. Only a handful of people will be rich and the rest will be poor. In this system it only pays to be the person in power. The only way to narrow the gap is to lower taxes and shrink government. History proves this time and again.

Centrally planned economies/wealth redistribution does not work. The more aggressive the redistribution scheme the more freedoms are lost, the more oppressive the government and the more disparity between rich and poor. This is what happens everywhere redistribution is tried, in most European countries, the Soviet Union, Russia, Cuba, Venezuela and on and on. History proves this time and again.

Economics is a complex system, if we open and allow our minds to learn and study it we will understand the cause and effects and the unintended consequences that any seemingly small change will do. We may have to be willing to unlearn some of the misinformation we were taught in school as well. Some of the class warfare indoctrination will have to be excised. We are all equal after all, it does not matter what "class" society has put us in. We are all in this economy together.

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