Why are tax cuts considered good when we're in a recession and also good when we're in a boom?

Why is it always tax cuts, tax cuts, tax cuts? If that's the case, why even have taxes?

If less A solves condition Z and less A solves condition X then it makes sense not to have A.

Update:

Don't just say "they're good." Why are they so good? Details! Explain the logic of doing the same thing for a recession and a boom. Then why have taxes at all?

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  • Anonymous
    1 decade ago
    Favorite Answer

    Tax cuts are very much needed, but not for everyone. The lower and middle class from Bush's view do not need the tax cuts and I must agree with him (seriously if I don't agree with him I am going to jail). What these liberals need is a dose of reality. Only the rich should get tax cuts. Why? Because they are the ones that drive the entire economy. They are the ones who own the factories and stores that the lower and middle class work at. If they do not get tax cuts the will not spend as much. The lower and middle classes will lose their jobs and have no income. Over the last few years since Bush gave tax breaks to the rich the American economy has never been stronger. We are no where near a recession and everyone is living very well. I am sick of liberals mentioning statistics and facts that go against what Bush says. Who are they to tell us the American economy is not booming. So what if house foreclosures are up 75% from last year and people need two or three jobs to get by. Remember facts are nothing but evil. How? Easy facts are important to all of science. Science proves the bible is a bunch of crap so science is evil. So you see facts and science go hand in hand and since science is evil facts are too. Bush sees this and knows better than to rely on facts. This is why America is in its great shape of today.

    Source(s): My source? If you have to ask you are a communist. Are you...are you a communist? Is that what you really want to be?
  • 1 decade ago

    Taxes are necessary to fund the government and yes, the capitalist country you live in. The decisions of the government are not always directly correlated to economic need, but also to please the populace. During a recession, economic output is greater than actual demand, hence a tax cut can help increase consumer spending in the formula Y=C+I+G+NX, where C is consumer spending. Y is GDP or output. I is investment; G is government expenditure; and NX is net exports. During a boom however, economic output is less than economic demand, and thus there is an increase in inflation.In order to bring inflation down, it would make more sense to increase taxes. I'm not sure if tax cuts are considered good in a boom however. It might just be that politics play a role into economics.

  • Anonymous
    1 decade ago

    Very simply, tax relief stimulates new business, which employs more people, which pay additional taxes, even if at a lower rate, thus increasing the amount that government collects. Money and business are a dynamic factor, and not fixed, like the old "piece of the pie" saying goes. The proof is that the government now has a 3 trillion dollar budget vs. a budget of only billions 20 years ago.

  • Anonymous
    1 decade ago

    Tax cuts for everybody is a good idea as it stimulates the economy, however the repuglicans practice supply side econonmics and only give tax cuts to the very rich and that has never been good for anything except for a recession like the one we are in.

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  • Anonymous
    1 decade ago

    tax cuts help to get us out of a recession, and bring in alot of money for the government when in a boom.....its good either way

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