If you are already laughing out loud screaming “cut taxes”, CNN reports that you already have figured out the punch line here:
And, just as the president and lawmakers have done back in Washington, McCain unveiled a new economic stimulus plan… We have some tough times ahead,” he said. “I will cut your taxes. I will encourage the growth. I will eliminate the wasteful and unnecessary spending and we will get through this rough patch, my friends. We’ll get through it. “Specifically, McCain wants to: lower the corporate tax rate, allow a tax write-off for equipment and technology investments, and establish a new tax credit for research and development.
It would seem that all of the GOP candidates love that Low Bang for the Buck rebate plan that seems set to sail through Congress but they also would like to see more supply-side goodies for corporations on the hope of stimulating investment demand. I guess it cannot get into their thick skulls that a combination of easy money and tighter fiscal policy to lower interest rates is the best long-term means for having more investment. No – this crowd wants long-term fiscal irresponsibility which will later induce the FED to raise interest rates.
Ah but you Keynesians rightfully wish to focus on the potential short-term insufficiency of aggregate demand, which makes the calls from Mike Huckabee really absurd:
“It’s not enough to cut taxes.” Huckabee said. “You’ve got to cut the spending that goes along with it. We’re $9 trillion into debt. The federal government is not a good example for American consumers who have a debt issue right now because the federal government is the worst offender of all when it comes to spending money it doesn’t have.”
The HUCK is a lot like RUDY in his failure to understand the balanced budget multiplier. Seriously folks, if you combined everyone of these candidates knowledge of economics into the brain of one student at a community college, that student would still flunk Econ 101.