Curious as to where you learned your “most rudimentary understanding of economics.”
Businesses have to factor in both demand and costs. How much he produces depends on where the supply and demand curve intersect. If taxes are lower that’s going to cut his costs and move his supply curve and it will intersect with the demand curve at a different place.
This is moot. Even if costs are lowered for businesses, they’re not jumping in the water until consumers and their disposable income start spending.
I mean, you could have some combo of demand increasing and supply costs decreasing, but only the former drives the economy to grow.
Bottom line is, when you give tax cuts to people, or raise their wages, then that money in pocket gets spent. It is a tangible, real way to stimulate an economy, versus supply side, which is like some weird fantasy based on faith.
Exactly. Companies pay more to keep good employees. Hiring and hiring and hiring short term workers is not cost effective. Tamny touches on this as well.
This is quite correct. Most new businesses fail. More will fail with a mandatory $15 minimum wage. But that doesn’t seem to be connected with Ms. Greene.
It encapsulates the basics of business pretty well actually.
Ain’t nobody coming around to buy 20 lemonades, even if it’s good lemonade, if they don’t have the cash for it.
I think people who argue for supply side, tend to read until they find something that confirms their view. But I don’t think it’s that complicated, it comes down to what motivates people, both to spend, and to hire/produce.
Good for the economy, or good for themselves? Not the same.
That’s not why I thought it would crash. I thought it would crash because he cut taxes and increased spending, which is pretty common sense.
Or because certain forms of bunk economics benefit them personally
If his taxes are lower, he’s gonna pay his workers the same thing anyway and pocket the money. Or as @mups said,
JDsmith: Exactly. Companies pay more to keep good employees.
Not always they don’t. They cut costs by outsourcing their labor to the Phillipines to avoid minimum wage. How many layoffs did airlines just make, despite rolling in Cash.
But our economy has long since gone off the rails where only that matters. (See: subsidies for industries already rolling in cash)
You should pick up a basic economics textbook. If you’ve had economics, you probably took it from some Marxist school and not from a mainstream department.
If you take it out the abstract though, and look how people act rationally.
Say I have a one-classroom private school. I have capacity for 10 students.
I’m given a tax break, I can afford a new teacher. But there’s no waiting list.
Do I
a) hire a new teacher
b) wait for new students
That isn’t to say if you put money in a businesses’ pocket, they won’t utilize it to seek out some growth. Perhaps I would try some low-risk advertising.
But that’s not where things get done in terms of turning the economy up. Consumer confidence is the vast majority of it.