- Apr 6, 2020
- 1,031
- Tinnitus Since
- 2016
- Cause of Tinnitus
- 2016: headphones, 2020: worsened thanks to Rammstein
Trump and Reagan's Favorite Economic Theory Debunked: Millionaires' Tax Cut Doesn't Help
There has been criticism for some time, but now it has also been scientifically established: tax cuts for the highest incomes cause more inequality and do not contribute to the prosperity of lower incomes and middle incomes, researchers say in a study of the richest countries.
This can be seen as a line through the so-called "trickle-down economics", the theory behind the economic policy of, among others, US presidents Ronald Reagan and Donald Trump. According to that theory, money that the rich do not have to pay in tax via expenditure ultimately ends up with the lower incomes.
Researchers David Hope (London School of Economics) and Julian Limberg (King's College London) argue that tax cuts for the very rich over the past 50 years have helped only the very rich and have not led to more jobs or economic growth. "Policymakers should not worry that raising taxes on the rich to cover the financial costs of the pandemic will hurt their economies," said Hope. The study authors examined the effects of taxes on income, capital and assets in eighteen member countries of the Organization for Economic Co-operation and Development (OECD).
Tax increase
The finding is good news for British Chancellor of the Exchequer Rishi Sunak, among others, who may want to increase taxes on capital to bring the budget deficit down somewhat. Such a tax increase will be disproportionately due to the richest Britons. The findings also suggest that plans for a one-off 5 percent wealth tax on the 8 million richest Britons will not cause irreparable damage to the UK economy. Hope and Limberg's conclusions provide arguments against reasoning that is especially common in the US. Republicans, in particular, often argue that policies that help the richest are ultimately good for the rest of the economy.
Link to Dutch newspaper De Volkskrant:
https://www.volkskrant.nl/nieuws-ac...tingverlaging-miljonairs-helpt-niet~bfaf6732/
There has been criticism for some time, but now it has also been scientifically established: tax cuts for the highest incomes cause more inequality and do not contribute to the prosperity of lower incomes and middle incomes, researchers say in a study of the richest countries.
This can be seen as a line through the so-called "trickle-down economics", the theory behind the economic policy of, among others, US presidents Ronald Reagan and Donald Trump. According to that theory, money that the rich do not have to pay in tax via expenditure ultimately ends up with the lower incomes.
Researchers David Hope (London School of Economics) and Julian Limberg (King's College London) argue that tax cuts for the very rich over the past 50 years have helped only the very rich and have not led to more jobs or economic growth. "Policymakers should not worry that raising taxes on the rich to cover the financial costs of the pandemic will hurt their economies," said Hope. The study authors examined the effects of taxes on income, capital and assets in eighteen member countries of the Organization for Economic Co-operation and Development (OECD).
Tax increase
The finding is good news for British Chancellor of the Exchequer Rishi Sunak, among others, who may want to increase taxes on capital to bring the budget deficit down somewhat. Such a tax increase will be disproportionately due to the richest Britons. The findings also suggest that plans for a one-off 5 percent wealth tax on the 8 million richest Britons will not cause irreparable damage to the UK economy. Hope and Limberg's conclusions provide arguments against reasoning that is especially common in the US. Republicans, in particular, often argue that policies that help the richest are ultimately good for the rest of the economy.
Link to Dutch newspaper De Volkskrant:
https://www.volkskrant.nl/nieuws-ac...tingverlaging-miljonairs-helpt-niet~bfaf6732/