Anonymous
Anonymous asked in Politics & GovernmentOther - Politics & Government · 1 decade ago

if tax cuts work.........why cant that be applied to all govt services?

if tax cuts infuses the market and increases productivity,,,,,why not lower fees for city transportation to increase ridership?

6 Answers

Relevance
  • Elana
    Lv 7
    1 decade ago
    Best Answer

    "If tax cuts work" assumes facts not proven.

    Indeed, this is one of the most controversial

    statements in economics.

    Its like starting your question was "If Hitler was

    a saint", at least to some.

    Certainly if you cut taxes and change no services,

    than the economy will have a little more money pumped

    into it and that is good. Of course if the money you

    sacrificed was "preparation money" (such as money

    used for emergencies), you are less prepared for

    emergencies. If and when an emergency happens,

    whatever gain you got from the tax cut is lost in

    reparation.

    When the economy has to start handling

    all of the fall-out for when education, social services,

    etc, go bad, it can end up being far worse than any

    gain the tax cut gives you.

    You also need to be careful at WHAT level the

    tax cut is - in the recent past, the tax cuts have

    benefited the most wealthy on the idea that

    (according to Reagan): "A rising tide lifts all

    boats."

    Reagan was an idiot (though a charming one).

    If you're not in a boat, a rising tide causes you to

    drown. Similarly, a happy stock market is not the same

    thing as average salaries increasing.

    I wholeheartedly agree that our government is

    needlessly bloated - but not because it offers

    services that aren't useful. It is bloated because

    it is completely unable to fire deadwood.

    Tax cuts usually lead to the rich getting richer

    and the poor getting poorer. That isn't a feature

    of any cut per se, but the cuts we have had in the

    recent past.

    Regarding public transportation, certainly making

    it cheaper will increase ridership somewhat, but

    how will you pay for the things that need to be done

    to keep public transportation going?

    I have an idea... Right now we use the general

    taxes to subsidize the building of highways. It doesn't

    matter how many miles you drive - some percentage

    of your income taxes go to concrete.

    Why not simply pay for any highway infrastructure

    changes out of gasoline taxes? For most, the price

    of gas goes up but their taxes go down. Its great

    incentive to drive less and use public transportation

    more.

    THIS is probably the biggest reason that gasoline

    prices are so high in Europe - they pay for the roadways.

    (The second biggest reason is that most of Europe

    has no gas of its own).

    Indeed, you can imagine using gasoline taxes to

    fund improvements in public transportation infrastructure.

    Everybody wins except those who are forced to

    use gasoline ... and the oil and car companies.

    I expect gradually increasing taxes on gasoline and

    phasing out highway infrastructure funding will spur

    on technological development (just high prices is

    already doing that) - and eventually those people

    who are forced to use gas will have an alternative.

    In that case, who would the losers be?

    You guessed it - the oil companies. Now do you

    see why it isn't happening?

  • 1 decade ago

    How can you possibly confuse bus fare with a tax cut. Yes ridership would increase if fares were lower, but the transit system would just be losing more money than before. I guess we could charge nothing to ride mass transit but at that point mass transit would simply become rolling hotels for the homeless.

  • 1 decade ago

    Why not offer the service at no charge, in most cases the tax payers bear the financial brunt of public transportation weather they ride it or not anyway.

  • Anonymous
    4 years ago

    Taxes alone can't solve the deficit. I beg to differ, if you are receiving revenue(taxes) and you don't spend any money, you reverse the deficit. Obviously that is the extreme example here but spending cuts alone CAN end the deficit.

  • How do you think about the answers? You can sign in to vote the answer.
  • wolf
    Lv 6
    1 decade ago

    Good idea.

  • 1 decade ago

    good point.

Still have questions? Get your answers by asking now.