Tamny deals with a number of issues consistently raised in Zandi-speak.
- Temporary tax cuts don’t promote growth, just reschedule it.
- Keynesian emphasis on consumption always ignores that production comes first, and that incentives to promote consumption are often taxes on the productive.
- Even tax incentives for businesses are a subsidy for old winners (manufacturing) at the expense of the new growth companies in our knowledge economy. It’s GM and GE vs Google and Facebook.
- Paying for continued unemployment delays the timing and raises the price at which the idle will return to the market.
- Finally, the devaluation of our currency wrought by the two “Queen Elizabeths”, far from being a good thing only raises prices for manufacturing goods as well as consumer goods, most notably oil, and devalues the thrift of our seniors at the critical time of their lives.
Enjoy the article.