Show me evidence that Bush's tax cuts created the robust economy?

Question

Former Bush economic advisor says the tax cuts didn't produce the high tax revenue or the economy.
http://voxbaby.blogspot.com/2007/01/new-years-plea.html

I give America's great ingenuity and entrepreneurship credit, not Bush.

Personally I don't think the economy is that well...my friend bought a house two years ago at 310,000....he says he will be lucky to get 300,000 for the house which is unoccupied

Answer 1

I don't see a robust economy anywhere. Government agencies from federal down to domestic are all making cuts, cities are closing a lot of schools and cutting services, companies are cutting jobs and benefits to stay alive, manufacturing is almost non existent, the job market is providing jobs with lower and lower pay. So what exactly is so robust about it?

Answer 2

Money multiplier effect works better in public hands than it does with the government. If you allow citizens to keep more of their money, they are able to buy more(economy). If people buy more, manufacturers will produce more, hire more and make more money.

Tadah

To add. Just because your friend is now having to short sell his house is not a sign of a failing economy. There was a lending boom that took place the last few years and everybody was all giddy that their houses were increasing at about 14% a year. Was your salary increasing that fast. Houses are overpriced in many markets because of individuals that suddenly thought they would retire off their house.

How hot were some stocks in the '90's. People go from one boom to the next and things then settle. As Mr Greenspan said in '97 "Irrational exhuberance."

Answer 3

The immediate effects of a tax cut are, generally, a decrease in the real income of the government and an increase in the real income of those whose tax rate has been lowered. In the longer term, however, the effect on government income may be reversed, depending on the response that tax-payers make. Supply-siders argue that tax cuts for corporations and wealthy individuals provide them with an incentive for investments which stimulate so much economic activity that even at the lower rate more net tax revenue will be collected.

The longer term macroeconomic effects of a tax cut are not predictable in general, because they depend on how the taxpayers use their additional income and how the government adjusts to its reduced income. Four idealised scenarios can be hypothesised:

Government cuts its expenditure, and taxpayers increase theirs, spending the money on commodities sourced from within the country. This combination is macroeconomically neutral, but advocates of a free-market economy argue that it improves economic welfare, since people are more accurate than the government in spending money on commodities that they actually want.
Government maintains its expenditure (thus incurring debt), and taxpayers increase theirs, spending the money on commodities sourced from within the country. This combination provides a stimulus to the economy, and it is on these grounds that advocates of supply-side economics frequently argue for tax cuts. It should lead to economic growth, bringing about greater general prosperity, though unless managed carefully it will also lead to inflation. A government making tax cuts and incurring debt usually hopes that the economic stimulus of the tax cut will be large enough to produce a long-term increase in tax revenues, allowing the debt to be paid off in the future. If that does not occur then the government can be left with a severe budgetary crisis.
Government cuts its expenditure, and taxpayers either save their increased income or spend it on commodities sourced from outside the country. This combination has a deflationary effect on the country's economy, and could lead to balance of payments problems, though it will tend to expand the economies of the countries sourcing the commodities that people purchase. However, if saving predominates over the purchase of imports, there may be an indirect stimulus to the economy because the additional supply of capital tends to reduce the interest rate.
Government maintains its expenditure (thus incurring debt), and taxpayers either save their increased income or spend it on commodities sourced from outside the country. This combination is not inherently deflationary, but it contributes to balance of payments difficulties which may have secondary deflationary effects and as noted above may lead to a government budgetary crisis with a painful readjustment to follow.
In practice it is likely that a mixture of these effects will occur, and the net effect of any tax cut will depend on the balance between them. It will therefore be a function of the overall state of the national economy. In conditions where most goods and services (especially those frequently purchased out of discretionary income, such as consumer durables) are produced domestically, a tax cut is more likely to provide a macroeconomic stimulus than in conditions where most consumer durables are imported. Furthermore, the actual effect will inevitably be difficult to discern, because ofnumerous other changes in the economy between the time when a tax cut is proposed and the time when its full effects would be realized.

If government does reduce its expenditure to accommodate tax cuts, there must necessarily be reductions in government services, and there may also be a reduction of the government's capacity to redistribute income to reduce income inequalities. Critics of tax cuts argue that this leads to a fall in overall economic welfare because the effects fall disproportionately on those with the lowest incomes

Answer 4

OUR ECONOMY IS SHOT ITS THE ECONOMY OF THE SAUDIS AND THE OTHER OIL RICH COUNTRYS THAT ARE ROBUST

Answer 5

What robust economy????????????