|
PureBytes Links
Trading Reference Links
|
Bruce,
The revenue increases that have accompanied tax cuts have never happened in
a vacuum. There are economists, or economic historians, who would argue
that Kennedy enjoyed the results of a stimulus spending program begun in
the Eisenhower administration and supported by a, usually, Democratic
majority in Congress. The Reagan tax cut gets a lot of undue credit,
IMO. Simultaneous with the tax package came the collapse of oil prices. I
don't have the figures for West Texas Intermediate at hand but I remember
my over-riding royalty income, little as it was, dropping by more than half
between October 86 and April 87. October checks were based on $27 BO,
April's were based on $11- $12 BO. World consumption at the time was on
the order of 50--60 million barrels per day. For the world economy this
meant at least an additional $500 MM a day to spend or invest. And
of course the world's largest oil consumer benefited most. Texas,
Oklahoma, Colorado and Wyoming--all energy producers--collapsed into local
recession in spite of the tax cuts. The rest of the country boomed.
Compared to tax brackets of up to 70% that persisted for much of the post
war era, current brackets are low. If the Feds are collecting a larger
amount of GDP than previously, that is partly because we demand more of
them and partly because we are still paying down the deficits created by
the Reagan program of increased defense spending coupled with tax cuts.
I have heard all of the reasons why energy prices aren't as important to
the economy as they were in 73. If I didn't drive, heat and light my home,
eat food planted and harvested and processed by energy consuming machines
and carry it home in plastic bags, I might believe it. Revenue growth or
shrinkage will be less affected, I believe, by Fedral tax policy than by
the "indirect tax" of artificially high oil price. The inverse
relationship between the market and oil price is real and bodes ill for market.
Sorry I got carried away there -- Hope you had a good Holiday,
Charles Marchand
At 12:12 PM 11/23/00 -0500, BruceB wrote:
>Hi Steve. The important point here is that all the so-called experts and
>mainstream media are predicting that tax revenue will fall if Bush reduces
>tax rates, when the historical evidence clearly indicates the opposite could
>be true. I mentioned three times in US history where RATES were reduced,
>but REVENUE increased. You stated you believe US tax rates are relatively
>low, but what are you basing this on? The federal government is currently
-------------------------- eGroups Sponsor -------------------------~-~>
eLerts
It's Easy. It's Fun. Best of All, it's Free!
http://click.egroups.com/1/9699/0/_/152424/_/975036750/
---------------------------------------------------------------------_->
To unsubscribe from this group, send an email to:
realtraders-unsubscribe@xxxxxxxxxxx
|