If you are going to reduce the revenue you are taking in you need to cut spending to avoid creating a deficit or debt, and yes you would do this to cool off an economy or to pay off debt should you cut spending without cutting taxes.
If you are going to reduce the revenue you are taking in you need to cut spending to avoid creating a deficit or debt, and yes you would do this to cool off an economy or to pay off debt should you cut spending without cutting taxes.
Lauchs@lemmy.world 1 day ago
Oh, if the impetus is just to cut taxes, well I don’t think that’s particularly ideal.
If you’re cutting taxes in the hopes of Laffer striking again, fine but that’s supposed to be revenue generating.
If you’re cutting taxes for the sake of lower taxes, then you need to have some services in mind that are worth less than the value of the tax cuts, not just in terms of dollars but in terms of what they do. For example, you could cut SNAP benefits but yeah, most would be against that because feeding poor kids is pretty popular.
I don’t think these are unpopular because people don’t know economics so much as there aren’t many services they’d give up for marginally lower taxes.
MothmanDelorian@lemmy.world 1 day ago
Ideally the impetus to cut taxes would be as a response to a recession to get the economy moving. Im not advocating cuts for cuts sake.
Lauchs@lemmy.world 1 day ago
Ahhhh, gotchya, sorry missed that!
Though, I think tax cuts are fine to spur demand (especially targeted at lower income levels) though I’m a little hesitant about cutting spending. I’m in the camp that feels deficit spending is okay, maybe even desirable for things like recessions and wars. Spending cuts usually act as a drag on growth so if your goal is to heat up an economy, cutting taxes AND spending seems counter productive…