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Trickle down

Written By: - Date published: 8:19 am, December 19th, 2011 - 44 comments
Categories: economy, tax - Tags:

Key: “Of course, if we could have lower personal taxes, we think that would stimulate the economy – but we just can’t afford it”. But, if tax cuts stimulate the economy, you could make them self-funding. The 2010 tax changes were meant to pay for their net cost with extra growth. Didn’t happen. They’ve cost $1.1b so far. Does Key still buy this trickle down garbage or not?

44 comments on “Trickle down ”

  1. fisiani 1

    Growth in 7 out of last 8 quarters and today’s growth result out very soon. Onwards and upwards with National.

    • jimmy 1.1

      Onwards and upwards with National.

      Treading water more like it…
      Most New Zealanders did not find the tax reshuffle “fiscally neutral”.

      National would argue that it’s all the global markets fault and under Labour it would have been worse. Pity historical figures don’t support that view. I doubt Labour could have done worse than muddling through.

    • Lanthanide 1.2

      Yip, doesn’t matter if the growth rate is actually lower than per capita growth. All that matters is that the number isn’t negative.

    • bbfloyd 1.3

      nice to see you back little fizzer…… you still fail to display even the most basic humanity, or any depth whatsoever, but your ranting is amusing at least…..although i must admit, you show as much understanding of reality as mr muddle does, and about the same level of empathy with the victims of the corporate/national economic sabotage…….none whatsoever….

      unlike the seriously intellectually/emotionally stunted tory brains trust, we all know why the rain feels warm on our necks…

    • Macro 1.4

      “Onwards and upwards with National.”
      lol tosser! I take it you don’t actually go outside much.

    • mik e 1.5

      Fishy.What trash you talk we’ve had -0.3% deline in growth since this govt been in power .

  2. mike 2

    This Government remains neo-con in spite of everything. Key follows the Reagan/Thatcher model right down to Reagan’s smile and wave while the back-room bastards fiddle the books. They still believe in the failed Friedman market model even after it has totally collapsed. They’re pursuing it because it pours more of our government’s dough into their mates pocket – not only in tax cuts but jobs for the ‘boys’ at highly inflated salaries. They are determined to squeeze every last drop out of the failed Rogernomics revolution. We just have to get used to it again now until 2014.
    See ‘The Party’s Over. How the west went bust’ on BBC World http://www.bbc.co.uk/programmes/b018cbkm/episodes/guide

  3. In Vino Veritas 3

    There doesn’t appear to be any link to back up your numbers Eddie. They wouldn’t be from fairyland would they?

    • Draco T Bastard 3.1

      The only numbers that come from fairyland are the numbers from the right. History has proved that cutting taxes on the rich causes recessions.

      • In Vino Veritas 3.1.1

        That’d be history concocted in your world, Draco. From a left wing perspective, things only go pear shaped when the left run out of other peoples money.

        • Draco T Bastard 3.1.1.1

          In reality things only go pear shaped when the rich end up with all the money and everyone else is in debt to them. It’s what happened in 1929, 2k8 and numerous other times over the last 5000 years.

          • In Vino Veritas 3.1.1.1.1

            Then there’s the rub Draco, don’t borrow from anyone. But socialism by it’s nature always ends up having to borrow, and other people get sick of not being repaid.

            • Draco T Bastard 3.1.1.1.1.1

              But socialism by it’s nature always ends up having to borrow,

              No, it doesn’t. The only reason why we end up with any “borrowing” at all is because the capitalists have taken control of society and direct all the wealth to themselves which, inevitably, ends up with the collapse of the society.

              • In Vino Veritas

                Ah-ha! I see your point Draco! Capitalism forces socialists to borrow! Excellent. That would be because the Socialist have nothing further to redistribute without plunging their country into the morass (see Greece). That would be because they have promised standards of living that they cannot afford. And because they have promised standards of living they cannot afford, to stay in power they need other peoples money. And of course, that’s the fault of the capitalists, because they have the money. How very logical of you.

                • it

                  The Greek government leading up to collapse was right-wing

                  New Democracy is the main centre-right political party and one of the two major parties in Greece. It was founded in 1974 by Konstantinos Karamanlis and formed the first cabinet of the Third Hellenic Republic. After serving as the Cabinet of Greece from 2004 to 2009, New Democracy is now the main opposition party in the Hellenic Parliament after its smashing defeat in the 2009 Greek elections in which they recorded their historical lowest percentage of votes.

                  Parallel to G.W Bush and being followed by Key IMO.

                  • In Vino Veritas

                    it, here’s an earlier post I made when someone came up with “it was the right wingers in Greece theory”. You can retract any time you like.

                    Voice, not sure your analysis is factually correct. When PASOK were elected in 09, % of debt to GDP was about 110%. It then leapt to 142%. From 04 – 09 under New Democracy, it ranged between 100% and 110%. Though to be fair, it was trending upwards.

                    Also, PASOK were in power from 1993 – 2004, so the socialists have in fact been in power for 13 of 18 years, so to say the right have caused the major issues is far from the truth. During 93 -04, the trend of % debt to GDP steadily trended upwards.

                    Its the old socialist story Voice, “socialism is great, until you run out of other peoples money”. Never a truer word spoken, in terms of Greece leastways.

            • Mike 3.1.1.1.1.2

              “don’t borrow from anyone”

              Well how would you suggest new money is created to keep up with economic growth then?

              What. you mean you’re commenting on things financial and economic but you don’t know how money is created?

              Your lack of knowledge is astounding. (But not unexpected)

        • joe90 3.1.1.2

          Yup, from a RWNJ’s perspective the 3rd century crisis through to the banking crisis of the 14th century, tulip mania, the panics in 1776, 1819 and 1857 were all caused by the left running out of other peoples money.

          • dv 3.1.1.2.1

            So what happened in 2008?

          • In Vino Veritas 3.1.1.2.2

            joe90, you are confusing a system that longrun, always fails (Socialism – see Greece) and short term bubbles in system that works (Capitalism). You clearly don’t understand that most people don’t want to live in misery, which is one of Socialisms absolutes.

            • joe90 3.1.1.2.2.1

              Lolz!, millennia upon millennia of catastrophic failure but the market will must work….this time

            • McFlock 3.1.1.2.2.2

              Another irregular verb: socialism “fails”, capitalism “has short term bubbles”.

              How does a system – any system – “fail”? It experiences a shock so bad that it is marginally or completely replaced by another system. This happens after both socialistic failures (e.g. electing tory governments that cut taxes to the rich and kill workers by neglect and lax safety regulation) and capitalist bubbles (e.g. greater regulation in markets, implementation of widespread welfare schemes, nationalisation of some assets, focus on full employment as a key economic indicator rather than just inflation, and so on).

              “Socialism” (for a given value of “socialism”) has failed in some countries in some periods. So has “capitalism” (for a given value of “capitalism”). Both are also still operating in other countries, some of them reasonably well.

              Basically, it sounded profound, and almost suggested that capitalism had longer term stability than socialism, but really you said nothing.

              • In Vino Veritas

                McFlock, but socialism always fails in the end. Any system that imposes misery on everyone, will always fall over, since most people would appreciate the opportunity to better themselves at the expense of misery (see Russia ). If they have that opportunity, they strive. Therein lies the difference.

                Did you ever go to Russia before the wall came down? I did. The place and people were miserable.

                • McFlock

                  The point being that the meaning of the words “socialism”, “capitalism” and “fails” are exceptionally broad, rendering your statements meaningless.

                  • In Vino Veritas

                    McFlock, it is apparent that according to you, anything that doesn’t fit your ideaological view, is meaningless. Not a great basis for engaging in debate.

                    • Bored

                      Vino, I had the misfortune to go to a Communist country, as you say the place and people were miserable. I also have been to third world countries which are equally miserable, and are run along capitalist lines. I have been to parts of this fair land that are miserable as well…we claim to be democratic and capitalist.

                      Personally I don’t think socialism works when it is not coupled to respect for the law, and subservience to democratic institutions. The same applies to capitalism. Both “isms” will attempt to undermine their societies so that the institutions that should democratically represent the people are consumed into the hands of the “ism”. Both if allowed will run to slavery and oppression to all but a very narrow group of cadres / owners.

                    • McFlock

                      Excuse me for actually looking at how your words are chosen in context. You frequently use excessive wordage to say fuck all. If you are sick of me pointing out that what you say is meaningless, then I suggest that you cease saying meaningless things.

                      Greece is a democratic nation that has/had socialist policies. A significant financial collapse (i.e. credit shortage and deficits leading to massive unemployment and failure by government to fund allocated expenditure) has resulted in a change of government and some economic restructuring. This is what you call socialist “failure”.

                      England and the USA are democratic nations that have less extensive socialist policies and less financial regulation than Greece. A significant financial collapse (i.e. credit shortage and deficits leading to massive unemployment and failure by government to fund allocated expenditure) has resulted in a change of government and some economic restructuring. These are what you call capitalist “bubbles”.

                      And if you argue that post-Thatcherite britain or bush2 usa aren’t “capitalist”, then either “capitalism” never existed, or it did exist and catastrophically “failed”. Either way you are either wrong or just positing hypotheticals and pretending they have something to do with reality.

            • mik e 3.1.1.2.2.3

              Why are the Scandinavian countries doing better than us on poverty child abuse etc

            • Mike 3.1.1.2.2.4

              hahahaha, I love your brainwashed loyalty to your beloved capitalism. Let me guess, you believe in the invisible hand of the market as well? In fact, none of the ism’s works. Capitalism will fail. It is a mathematical certainty that our economic / monetary system as it stands will collapse. Or do you not understand how exponential growth with finite resources works?

  4. tc 4

    Leave this to the trolls people so they can further express their love of the neo con that just knife edged another term so they can push NZ even closer to such great economies like UK/US.

    Remember sideshow’s quote ‘ follow me and we’ll be like Ireland’…yup sure will banksta boy.

    • In Vino Veritas 4.1

      Hmm, would that be as opposed to the economies of say Greece, Spain and Portugal tc??

      • ghostwhowalksnz 4.1.1

        They are doing that now, first it was copy Ireland and borrow rather than pay it back during the boom ( but the voters didnt give them a chance to try it out) now its copy Portugal/Greece rack up ever higher debts with tax cuts while cutting back which kills the economy….. which leads to more cutbacks

        • prism 4.1.1.1

          gwwnz
          Could call this progression ‘stringbeancy’. Stringency isn’t potent enough meaning – still on the good side we have all that fat that we have been wanting to get rid of. During WW2 people were not as unhealthy on their short rations as could have been expected.

      • locus 4.1.2

        In 2010, before the eurozone meltdown, Portugal had one of the best rates of economic recovery in the EU. Portugal’s industrial orders, exports, entrepreneurial innovation and high-school achievements matched or surpassed its neighbours in Western Europe. But Portugal like Spain and Greece fell victim to successive waves of speculation by pressure from bond traders, rating agencies and speculators. http://www.nytimes.com/2011/04/13/opinion/13fishman.html?_r=1

        • Bored 4.1.2.1

          There is an intellectual vacuity around the politicians and economists responses to what is happening: if the figures and the cause don’t match the claimed reality the figures get adjusted, and the cause discredited. I have a theory that people will only recognize the unpalatable truth when their “aspirations” don’t meet with a reality caused by recession / austerity, a realization that they have been sold a pup. Like having the credit card stopped and the debt collectors turning up.

          The shit will then hit the fan when the voters worldwide see that they have been misrepresented and defrauded by their political leaders, and their vodoo spin doctors and economists. I suspect a flashpoint lit by austerity related policies will turn into a fireball of rage.

      • mike 4.1.3

        No, not opposed to. As well as

      • Macro 4.1.4

        I can’t understand your fascination with Greece Spain and Portugal? Nice places to visit I know – But there the greedies don’t want to pay their taxes (way) – just like here! So what’s the difference? Like them, we are bound on the same pathway, building up more and more debt (financial and environmental) so sometime in the future – probably sooner, rather than later, the debt will be called in. The sad part about it all is that Key and English have no idea how to manage an economy and BAU is only piling us deeper in Debt.

      • mik e 4.1.5

        mostly right wing govts

  5. fender 5

    It’s been well explained by many and various economists worldwide that the “trickle down” excuse for making the rich richer is a fraud. It’s a propaganda slogan for the class war taking place.

  6. hoom 7

    Since the Average Salary & the top of the 17.5% tax bracket are basically the same: By their own admission Nats have made it so that 75% of the population earns less than the Average Salary.
     
    That takes some mighty big outliers on the top end & its a statistic that really needs to be out there in the public mind.

  7. randal 8

    peace on you bro!

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    1 week ago