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The Daily Cardinal Est. 1892
Saturday, May 18, 2024

Top-down economics still unconvincing

Now that President Bush has declared that the major offensive military action in Iraq is over, hopefully some of our nation's focus will shift towards a major issue on the home front: the economy. Bush is pushing for a $550 billion tax cut, as well as eliminating taxes paid on corporate dividends. I believe his top-down method of economic recovery is not working and will not alleviate the terrible financial situation our country is currently in. 




President Bush would have you believe that his billions of dollars of tax cuts are working to improve the economy, but I'm certainly not convinced. There was a huge tax cut in 2001 that was supposed to drastically improve our situation, but the results do not show a successful economic rebound. Our economy is too complex to be solved by simply returning a small amount of money to the majority of American taxpayers. 




A top-down economic plan ignores immediate issues that are causing large problems, like unemployment. With unemployment rates on the rise, and 2.5 million American jobs lost since the Bush administration took office, I would hope that more people than me are skeptical about top-down economics. 




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Overall, I'm just not convinced that tax cuts are really the outstanding solution the president has made them out to be. The $300 rebate given to taxpayers in 2001 was meant to flood millions of dollars into the American marketplace, but did it? I don't believe that the majority of people got their check in the mail, immediately cashed it at the bank and then went on a shopping spree. Surely an unbelievably large tax cut will help to improve consumer confidence, won't it? Actually, since this rate is decreasing just as fast as unemployment rates are increasing, you tell me how effective it is.  




In addition, let's not forget our ever-growing federal deficit, which now stands at over $300 billion. With the Senate already agreeing on a tax cut of $350 billion (Bush wants $550 billion), it seems to me like we are making the problem worse. If this huge tax cut fails to stimulate the economy our country will be in unbelievable debt and unemployment rates will continue to rise, but hey-at least there won't be any taxes on corporate dividends. 




While all the previous aspects I've mentioned about top-down economics really bother me, there is one thing in particular that just makes me sick. Supporters of this economic strategy claim that the money given back to wealthy Americans, in the form of tax cuts and the elimination of tax on corporate dividends, is actually meant to help those with lower income and social status. Give me a break. 




Hearing people say this begs a fundamental question: If the plan is really designed to have money \trickle-down"" to those with lower incomes, why doesn't our government just put the money there in the first place? Why does it have to flow through America's wealthy citizens? Once again, I hope my skepticism is more than evident. 




I find it impossible to believe that our leaders who have implemented top-down economic policies truly thought the money would end up in the hands of people with lower incomes. If they really cared, they would have invested money in proactive solutions that would maintain positive momentum regardless of how the economy was performing (like education, for example). 




Improving this country's financial situation is going to take more effort than adding billions of dollars to the defense budget, giving back billions of dollars in tax cuts and ignoring the federal deficit as it develops into a serious issue. Top-down economics is far from a proven example of how to solve a country's financial problems, yet it seems to be the only option being considered right now. Unfortunately for President Bush, the American economy is not just something you can tend to only in between wars.  




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