Lv 6
Boober asked in Politics & GovernmentGovernment · 10 years ago

How is it the government says entitlements cost money, and at the same time, say that tax cuts cost money?

I can understand entitlements costing money, as they are expenditures, but I don't understand how reducing revenue increases cost. If I get a pay cut, I must reduce expenditures or I go broke. My pay cut would not "cost" me anything, but I would have to adjust my budget by reducing expenditures.

4 Answers

  • 10 years ago
    Favorite Answer

    In order to cut taxes on the wealthiest 1.5% of Americans, which is what the Republicans keep on doing every time they are in power, you CUT REVENUE---that's what taxes are is REVENUE or INCOME to sustain this nation's infrastructure (roads, public transportation, bridges and tunnels, the U.S. Post Office, police and firefighters, our military, our VA medical system, Medicare and Medicaid, libraries, national parks, border patrol and other security measures, etc.---all paid for by revenues generated. If those revenues are CUT drastically (which occurs whenever the Republicans OUTSOURCE all our jobs to Third-World countries and then turn around and give their RICHEST crony elites (the top 1.5%) giant TAX CUTS, then there is less money to spend on MAINTENANCE or services or entitlement programs and safety nets, etc.

    For a "bread-winner" such as yourself to LOSE your source of revenue and no other source was immediately available, how would you provide your family what is needed for them to remain sheltered, fed, and clothed? If there is no income, where would the money come from for these simple basics? Tax cuts to the really-rich-few in this nation of 300,000,000 people makes NO SENSE (Picker, 2009), because this means no revenues to cover the basic needs of this nation and its people. Fair-SHARE taxation (such as was in place under President Clinton and is soon to be back in place under President Obama), as exists in the REVERSE of failed GOP supply-side economic policies, the DEMAND-SIDE approach of generating spending from the broad masses on the bottom of our social scales that works its expanding-economy way upward and outward until ALL levels prosper---not just the GOP's elite FEW. Warren Buffett, one of the world's richest men, agrees that these tax cuts were both foolish and wrong, by the way.

    Source(s): Picker, Joshua (2009), "Before the Bush Recession: Supply Side Tax Cuts Failed to Deliver Jobs and Income Growth Between 2001 and 2007." Washington DC: Center for American Progress.
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  • 10 years ago

    If government was as responsible with a budget as (most) people are that would be done. Even business understands that. They tighten the belt when income is down, even cutting employees if they have too. Government however, is a hog. There is such an abstraction between what politicians want and the means to pay for those things, government rarely shrinks.

    This is why tax cuts COULD cost money. Conservatives understand that. However, if done correctly in concert with other fixes in the economy that may be necessary, tax cut raise revenues. If business if fundamentally OK and there is demand for its good and/or services, it will want to get that increased market share. To get there, it needs to expand but needs a shot in the arm in order to expand. Tax cuts provide that. The increased profits they ultimately get means increased taxes paid to the government as revenue. There are also increased start-ups whose mere existence eventually means revenue that didn't exist before.

    Entitlements cost money, tax cuts (if done right) make money, spur business and cut unemployment. A tax cut can get the country out of recession but is probably not enough to get us out of debt. That will take serious cuts to government and, quite possibly, eventual taxes just for that purpose. Keep an eye on government, they will eye that tax income greedily.

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  • 10 years ago

    Don't trust anything anyone says in government. Liberals want government to run everything. Liberals want to run the government. Spending costs all of us. We need to stop the out of control spending by the US government.

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  • Liddel
    Lv 7
    10 years ago

    To understand it you would have to embrace the liberal point of view that all money is the government's and they allow you to keep a portion.


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