A Real Obama Tax Cut?
George Savage ·
Dec 6, 2010 at 4:16pm
In science we have a saying: "Association is not causality." That said, do you find it plausible that the the following two headlines from today are purely coincidental?
Bush job approval rating higher than Obama's
White House Proposes Payroll-Tax Holiday
Whatever the cause, the fact that the president is proposing some sort of actual tax cut--not a highly conditional program or a refundable tax credit for non-taxpayers--is a good sign that we may yet avoid a second Great Depression. Sadly, robust economic growth will probably need to await Mr. Obama's retirement in 2013.
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Comments :
May '10
Re: A Real Obama Tax Cut?
Sadly, if my understanding is correct, Obama botched the job. No surprise there. The "tax cut" is on the employee side. That puts a few bucks into circulation. But it does not produce the incentive for employers to hire. A better long-term solution, if Obama was actually concerned about the unemployed and his own political future, would have been to eliminate the tax on the employer's side. That would have reduced the cost of hiring a new employee, thereby incentivising new jobs.
Re: A Real Obama Tax Cut?
I'm seeing the musical version. The President is being forced into a tax cut. After the Republicans file out he stands forlorn, alone in the Oval Office when...incongruously at first, Obama breaks into song. By the end of the third verse the President has his verve back; he's figured out the worst possible way to cut taxes, hopefully discrediting the idea forever.
Nov '10
Re: A Real Obama Tax Cut?
Even worse, it's temporary! Milton Friedman's Permanent Income Hypothesis tells us that these tax cuts don't have a chance of helping the economy, since people base their behavior on what they expect their long-term earnings will be.