Home > American Society, federal reserve, politics > The foolishness of the trickle down theory.

The foolishness of the trickle down theory.


The concept of the trickle down theory is to lower taxes (and / or provide money and incentives) to businesses to generate money for the middle and lower classes of the United States.

Here is the simple experiment to show the foolishness.  Take $10 from your wallet and give it to anyone you choose.  See if you ever get more back than you gave them.  The best case scenario is that you get back what you gave them.  You never get back more.

The idea that our government can give money to the wealthy and get a greater return of that cash to our middle and lower class citizens than direct grants and payment for services is complete foolishness and it is also impossible.

Business is the exchange of goods for money.  It does not expand the money base.  Every time we print more money it is to GIVE someone more money to work with.  The fact that we have 50 trillion dollars in circulation means that we have given 50 trillion dollars to businesses and individuals.  It does NOT mean that businesses have created 50 trillion dollars in income.

Stop thinking that business is the solution to all the problems in the United States.  Business is just a tool for exchanging goods for services.  It is the trading floor of the U.S. dollar.  Nothing more, nothing less.  The truth is that we are all slaves to the Federal Reserve.  Over half of your productivity as a citizen of this great country goes to paying interest payments to the Federal Reserve for borrowing what is already ours.

How insane is that?

Help, I am ItiA

Advertisements
  1. codecrackx15
    May 17, 2010 at 9:41 am

    Government should run a balanced budget. It should not be running to make a profit.
    Trickle down works and has been proven to work by Ronald Reagan. When you cut taxes business’s hire more people. When you raise taxes business’s pass the raise onto the consumers.
    The FED is totally out of control and our money would be worth a lot more if we were to revert to the Gold Standard once again.
    Your example is not correct either. You are saying that the Government is “giving” the business’s money by giving them tax breaks. That is untrue. A tax break allows the company to keep more of the money it makes from selling goods or services. It has nothing to do with the government.

    • May 17, 2010 at 10:12 am

      True true true.

      Yes tax cuts stimulate job creation. The question is…..

      “Do we as a country get a greater return on the money spent on tax cuts to large corporations than what we invested?”

      The answer is no. Tax cuts stimulate investments by companies. These investments mean new jobs, but the tax cut will always be more expensive than the net return in taxes back to the government from that tax break to a large corporation.

      I believe the right answer is investment by the government in small businesses, not large businesses. Small business has more of a exponential growth potential than large businesses. That is the wiser investment of tax money and self employed Americans make a stronger America than Americans employed by large companies.

      Using the term Trickle down as a method of convincing Americans to approve tax breaks for large corporations is the problem. I believe that the term became a powerful method of our government having an open checkbook for large corporations.

      Thanks for your comment.

  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: