Anonymous
Anonymous asked in Politics & GovernmentPolitics · 10 years ago

Can anyone explain how tax cuts cost?

How does allowing people to keep more of what they earn cost the USA?

Are tax cuts an entitlement now?

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  • Anonymous
    10 years ago
    Favorite Answer

    The only way tax cuts cost if if they are not offset with spending cuts and they never are. Eventually you will have to pay the finance charges and that will require even more cutting back or increased taxes.

    Tax cuts do lead to temporary prosperity because of the spending beyond our means. We borrow money to pay for our life style now and mortgage our future. Most conservatives like to publicly pretend that when the government spends money it does not result in the people we buy our tanks from having jobs and buying other things in the private sector. It does.

  • 10 years ago

    Tax cuts cost only when they aren't paid for. Taxes are levied so that government can operate and provide essential goods and services that people can't provide for themselves. Services like the military, police protection, representation, fire protection, education, etc. Anyway, when the taxes are cut that means less tax revenue coming into the treasury and one or two things can happen. If the economy is slow, that means the loss of tax revenue will have to be paid for by cutting services or government personnel. Otherwise, you will be running a deficit and we'll have to borrow money. If the economy is running well, the government may make up for the loss revenue with the higher volume of taxes that the economy is creating. It really depends on how the economy is running at the time of cutting taxes. Most tax cuts occur when the economy is in recession so that people can keep the money they have and hopefully spend it in the economy to lift the country out of recession. However, this creates costly deficits if not reversed. The situation we are currently suffering is that the Bush tax cuts were passed to reverse a recession but were never paid for. So, when he extended these tax cuts there was always a weak economy and he never cut spending on essential services. This created a wide gap in wealth, nearly eliminated the middle class, and buried us so deep in debt that China now controls our purse strings. I hope this explanation helps.

  • bob
    Lv 7
    10 years ago

    I guess gramma has become totally senile now. Here's how it works. We have government expenses...you know things like paying for wars that Republicans start to enrich their buddies, maintaining roads, bridges and buildings that house the government and whole slew of things that a modern government is responsible for. The government collects taxes to provide those services. When we don't collect enough to cover those costs so that the richest of us can hoard their money and keep from being in circulation the economy suffers. As an example, GWB cut taxes and in the next eight years we doubled the national debt. Now we must pay interest on that debt. That is how it costs us, and no tax cuts are not an "entitlement" they are a road to an economic disaster

  • Anonymous
    10 years ago

    We had a deficit when bush gave the rich trillions of dollars.

    If you cut revenue (tax income) as bush did, that increases the deficit.

    Tax cuts have the EXACT same impact on the deficit as spending does.

    I can't believe conservatives don't get this.

    If your revenue is 50,000 / year, and you take action to reduce revenue by 100,000 / year, you go negative.

    That is what tax cuts do - reduce government revenue.

    And as we have seen over the last decade, tax cuts for the rich DON'T CREATE JOBS.

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  • Anonymous
    10 years ago

    When new/increasing Revenues (or Spending cuts) do not more than cover the amount of the Tax Cut(s), the difference immediately goes into the Deficit column. It's not hard to understand.

  • Anonymous
    10 years ago

    Liberals(Socialists) consider every dime you make to be property of the State,this is because they consider us Subjects,not Citizens.

    As such,ANY money they let you keep is a cost to the State.It's a handout they cannot provide to the leeches in society who vote them into power,it's a Govt Agency they cannot expand or create,etc.

    RWE

  • 10 years ago

    IF YOU HAVE MORE MONEY YOU WOULD SPEND IT MORE MAKING OUR ECONOMY GROW AND PROSPER

    IF YOU HAVE HIGHER TAXES THE GOVERNMENT USES IT FOR WHAT THEY WANT AND ITS JUST A WASTE

  • 10 years ago

    Well, look at our economy SINCE they were IMPLEMENTED!

    TRICKLE DOWN, even REGAN said it, DOES NOT WORK.

    Where are the jobs, what happened to our economy, why the recession.

    Hell, they were implemented in 2001 & 03 AND ...................................

    that didn't help our country

    one

    dam

    bit, zaza.

  • Anonymous
    10 years ago

    As you already know (lol...), it hurts those who leech off of entitlement programs and politicians who want to have more funds in order to complete their dirty deeds with.

  • Brian
    Lv 7
    10 years ago

    They don't. Only those who think that the money belongs to the government rather than the person who earned it could believe that..

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