Why the Economy Grows Like Crazy Amid High Taxes

This is by far one of the best articles I have read in a very long time. It articulates why “Trickle Down Economics” doesn’t work and why the policies that the Republicans advocate and promote just plain don’t work.

Why the Economy Grows Like Crazy Amid High Taxes

High taxes create an incentive to reinvest profits into long-term growth.

With high taxes, the only way to retain the bulk of the wealth created by a business is by reinvesting it in the business — in plants, equipment, staff, research and development, new products and all the rest.

The higher taxes are (and from 1940 to 1964 the top rates were around 90 percent), the more this is true.

This creates a bias toward long-term planning.

If a business is planning for the long term, it wants a happy, stable work force. It becomes worthwhile to pay good wages and offer decent benefits.

Low taxes create an incentive for profit taking.

It is easy to confuse profitability with wealth creation.

They are not the same.

Even a total moron can understand the principles as laid out in this article. When you think about its premise, it makes a damn good case for helping the failing auto industry with its long term planning and actual wealth and job creation.

Unlike the $700 Billion dollar bank bailout which does nothing but contribute to the problem.

I hope POTUS-Elect Obama has some balls and does the right thing so we can get back to rebuilding America instead of selling it off piece by piece.

The places that government puts money are important. More to the point, they are important for business.

All infrastructure is an invisible subsidy for all business.

It’s easy to understand this when we’re talking about roads.

It doesn’t matter if your business doesn’t ship anything by truck or even by bicycle. The fact that you can get to your office quickly and easily, that your mailperson can get to you without traveling on the back of a mule, is a subsidy of your business.

The alternative is to sell off our infrastructure piece by piece. So instead of free highways which your taxes paid to build, you get toll roads. What’s next? Perhaps, the post office gets sold off to FED EX or one of its competitors.