Yes I meant keynesian, thank you Myp.
Please explain this Trickle-down thinking that you speak of.
I'm sure I know what I think you mean, but I would like to know what you think you mean.
I do not believe in giving money to the top earners in the hopes that they will pass it along to the people lower on the economic ladder, through spending and hiring. But I do believe it happens on its own naturally and history shows that it works. From what I here Bill Gates hires thousands of people with his company and give lots to charity.
If you are refering to tax breaks for the rich as trickle-down economics you are on a slippery slope. Do you feel that it is giving money to the rich to achieve the trickle-down effect? Some people believe this, but tax breaks are not "giving money", you cannot consider taking less, as giving.
The fact is that trickle-down economics (and in the context of gov't policy that
is tax-breaks, sorry) doesn't work. You can lower corporate, business and upper class taxes down to nothing, if there's no demand for labor (and in this economy their isn't, thus the lay-offs) then they're not going to hire. It'd be a waste of payroll.
And when their
is a labor market? Yes they'll hire but if they were profitable they'd of hired anyway out of need and as they're in the business of making money they'll pay as little as they can while still being able to find willing applicants and will only hire until they have all needed positions filled. Combined with the tax-cuts and the improved production the new help brings they'll increase their profits by a health margin. From a capitalist POV there's nothing wrong with this, it's good business but the only thing that tax break did was give them an incentive to lower wages (to maximize the increase in profits).
Maybe it'll help the jobs market if that company was running a slight deficit and needed help pre-tax-cut but unless such companies are a relatively large number nationally (and they're not) the effects will be limited and irrelevant in the grand scheme of things.
Will they buy more with the increase in profits? Yes but again only to what their market share dictates, so you end up with the same issue that you have with labor.
Economically it's a different story but the economic situation is so poor that 'natural' trickle-down isn't possible. Companies need to be profitable to expand (thus spending more) and increase wages and the handful of major (and thus economically relevant nationally/globally) companies that are are hoarding the profits to line their own pockets and as a nest egg in case the economy suffers another collapse. Until we enter a boom period where everyone is making money hand and fist, it's just not going to happen.
