Trickle-Down Economics Must Die, Long Live Grow-Up Economics
Joyce Park stashed this in Economics
Aside from ethical questions, does trickle-down economics work? Why tax cuts for the wealthy actually SLOW economic growth.
Wow, I had no idea it was this bad:
What Mother Jones neglected to mention however is something that goes well beyond “fucked up”, and something which did not go unmentioned in a piece by the Institute for Policy Studies after identical news the year prior.Every extra dollar going into the pockets of low-wage workers, standard economic multiplier models tell us, adds about $1.21 to the national economy. Every extra dollar going into the pockets of a high-income American, by contrast, only adds about 39 cents to the GDP. These pennies add up considerably on $26.7 billion in earnings. If the $26.7 billion Wall Streeters pulled in on bonuses in 2013 had gone to minimum wage workers instead, our GDP would have grown by about $32.3 billion, over triple the $10.4 billion boost expected from the Wall Street bonuses.
Yeah, you just read that right. In 2013, by giving huge bonuses to those on Wall Street instead of low-wage workers, we actively prevented the creation of about $22 billion in additional national wealth. In 2014, we did the same thing, but to an even larger degree, preventing about $23 billion in additional national wealth that would have otherwise been created, had those billions in bonuses been distributed to low-income earners instead.