Would Tax Cuts Really Help?

Wednesday, 18 August 2010 at 5:06 am Pacific USA Time.

I keep hearing Republicans making it sound like most of our country's economic problems can be solved by tax cuts. The idea seems to be if you're paying less in taxes, you're going to take that money and pump it back into the economy… which will stimulate things, and get us out of the recession.

What I want to know is how much of a tax cut would you have to get? How much would you have to get for you to really notice you have more money in your pocket? And how much of a tax cut would you have to get for you to then run out and spend it on something you weren't currently buying?

I don't mean spending it on the mortgage or car payment… you have to make those anyway! I don't mean putting that money in savings, the kids' college fund, or just letting it sit in your account.

The idea is that tax cuts give people money to spend, and the spending is what makes things flow. So I want to know… if you paid less taxes next year, would you be spending that "extra" money on random stuff? I'm just curious what other people would do.

Me? I have some small balances on credit cards I haven't paid off yet. I think if I had "extra" money, I'd pay those off. But does that stimulate the economy, especially if I plan to not spend money on those cards and leave them paid off?

  • Facebook
  • Twitter
  • LinkedIn
  • Email
  • Digg
  • Google Reader
  • Delicious
  • Reddit
  • StumbleUpon
  • Technorati
  • Tumblr

Categories: Just An Observation

Comments Closed

One Response to “Would Tax Cuts Really Help?”

  1. Roy Baker says:

    I’d probably use any tax cuts to pay off something I owe. Tax cuts in general are not enough to make me want to run out and buy something. Probably what they should have done with the Tarp funds was give it to the taxpayers to pay their bills and let the money trickle up instead of down. The companies would have gotten the money anyway and people would have reduced their personal debt allowing them to buy a few more things.