Skewering of Leftist Economic "Conventional Wisdom"

[whell]

Originally Posted by Chicks

Hedge fund billionaire Howard Marks is throwing cold water on the GOP tax law

https://finance.yahoo.com/news/hedge...211040536.html

“So call it a gift to the corporate sector if you want, but I think it's unlikely to be much of a job-creator or long-term boon for the American middle class”

"We've seen a number of companies give raises or bonuses following the enactment of the tax law, but I doubt it was done out of generosity," Marks wrote.

He says there's every reason to believe that most of the corporate tax benefit will be used to "enhance credit ratings, fatten dividend payments, and finance stock buybacks."

All of that is fine and well, but those weren't the rationales Republicans gave for passing the tax plan, according to Marks.

"Instead, it was billed as a job-creator," he wrote. "With unemployment already below average, many CEOs tell me they're hamstrung by a scarcity of qualified workers. So who will fill the new jobs if corporations expand in the US? And if workers aren't available, will new plants (and jobs) really be created?"

Well no shit Sherlock. Any increase in wages would be done only with a solid business case supporting it. Businesses are not likely to make their business case public, but the most likely reason would be that wage increases / bonuses, investments, etc., are part of forward-looking strategies to maintain competitive wages and reduce the risk of employee turnover heading into a tightening job market and sustain anticipated growth.

And, to me, its HILARIOUS to see high workforce utilization / lowering unemployment to be spun as if its going an issue that will be worsened by a corporate tax cut, as if additional job opportunities and economic growth was some kind of "problem".

[Chicks]

Donny’s long-promised 4% growth? Not even close. A mere 2.3% last year. Yet his minions still believe his lies.

http://www.newsweek.com/donald-trump...e-davos-792406

[BlueStreak]

Originally Posted by Chicks

Donny’s long-promised 4% growth? Not even close. A mere 2.3% last year. Yet his minions still believe his lies.

http://www.newsweek.com/donald-trump...e-davos-792406

I know a man who acted up at work, getting himself FIRED because he believed (As in past-tense.) the lie that manufacturing jobs are swarming back to the USA like locusts and he wouldn't be unemployed long.......

It's been five months, now. Moron.

[Chicks]

While Trump has talked up economic performance during his first year, it was simply a repeat of what we saw during the final Obama years: solid quarters of growth bracketed by slower growth; monthly job increases and historically low jobless claims; and high levels of inequality. In 2017, the economy grew 2.3% -- in line with its performance under Obama. But under Obama, the poor and middle class had their biggest annual wage increase ever, and more Americans had health insurance than ever.

Trump has conditioned us to disbelieve economic indicators, as did some of his high-profile supporters, who claimed the jobless rate was dropping under Obama because the books had been cooked. They did not care that the S&P 500 nearly tripled during the Obama years, even as they now tout every new record high under Trump. They did not care that the unemployment rate dropped from 10% early in Obama's tenure to less than 5% by the time he left office. Neither did they care that the poor and middle class received the largest annual increase in wages on record in 2016.

http://www.cnn.com/2018/01/26/opinio...ion/index.html

[finnbow]

WASHINGTON (AP)— Just last month, President Donald Trump was crowing about his chances for seeing the U.S. post 3 percent economic growth in 2017 and scoffing at the skeptics who predicted much less. Turns out the skeptics — actually, mainstream economists — were right and he was wrong...

TRUMP: “After years of stagnation, the United States is once again experiencing strong economic growth.”

THE FACTS: This is an exaggeration. The economy is doing better by some measures but data released right as Trump finished speaking shows it hasn’t yet accelerated meaningfully since his inauguration.

TRUMP: “Since my election, we’ve created 2.4 million jobs. And that number is going up very, very substantially.”

THE FACTS: Actually, job growth is going down.

Looking at annual totals, rather than since the November 2016 election, U.S. companies and other employers added 2.1 million jobs in 2017. That was actually the lowest job growth in seven years.

TRUMP: “The tax cut bill is expected to raise the average American’s household income by more than $4,000.”

THE FACTS: Most mainstream economists are skeptical of this figure. The average household will see its income rise $1,610 in 2018 because of cuts in income tax, according to the Tax Policy Center.

TRUMP: “The world’s largest company, Apple, announced it plans to bring $245 billion in overseas profits home to America. Their total investment into the United States economy will be more than $350 billion over the next five years.”

THE FACTS: This is misleading: It’s not clear from Apple’s statement that it is actually increasing investment in the U.S. from its current levels.

https://www.washingtonpost.com/polit...9dd_story.html

[finnbow]

WASHINGTON/NEW YORK (Reuters) - Two percent of U.S. adults said they had gotten a raise, bonus or other additional benefits due to the Republican tax law enacted a month ago by President Donald Trump, according to a Reuters/Ipsos poll released on Monday.

http://www.businessinsider.com/2-per...-passed-2018-1

[whell]

Originally Posted by finnbow

WASHINGTON/NEW YORK (Reuters) - Two percent of U.S. adults said they had gotten a raise, bonus or other additional benefits due to the Republican tax law enacted a month ago by President Donald Trump, according to a Reuters/Ipsos poll released on Monday.

http://www.businessinsider.com/2-per...-passed-2018-1

Absolutely freaking hilarious. Apparently, the survey folks worked pretty hard to try not to find anyone.

Meanwhile, back to reality:

Exxon Mobil announces $35 billion in new US investments over 5 years, citing tax reform

Exxon Mobil, the world's largest publicly traded oil company, on Monday said it plans to invest an additional $35 billion in the United States over the next five years.

As part of the investment, Exxon plans to increase production in the Permian basin, a shale oil region in western Texas and eastern New Mexico where the low cost of production has attracted drillers. Exxon said it will expand its operations, make improvements to infrastructure and construct manufacturing sites, activities that it expects will generate thousands of new jobs.

"These are all possible because of the resource base developed by our industry along with sound tax and regulatory policies that create a pro-growth business climate here in the U.S."

BAM!

[Chicks]

Dunno why Whell bothers creating threads. They always wind up making him look like a Donny sycophant fool, once the facts are revealed.

[Dondilion]

So what explains Wall Street? Another "Irrational Exuberance"?

[Chicks]

Originally Posted by Dondilion

So what explains Wall Street? Another "Irrational Exuberance"?

From the OP:

"Conventional Wisdom" - tax cuts for business are bad, since the business will not pass along the benefit of those cuts to workers, and there will be no economic benefit for anyone except business owners or share holders.


Posts on this page and previous pages show that the “conventional wisdom” is exactly correct. The lion’s share of the benefits of this tax cut are indeed going to business owners and shareholders, not Main Street. Whell gets it wrong, as he always does.