Do Tax Cuts Create Jobs? If So, How?

[OddTrader]

Do Tax Cuts Create Jobs? If So, How?

https://www.thebalance.com/do-tax-cuts-create-jobs-3306325

Best Way to Create Jobs

If tax cuts aren't great at creating jobs, what about government spending? That's not a good way to create jobs either. It takes $1 million in spending to create 19 jobs. That's still over $50,000 of your tax dollars needed to create one job. The CBO didn't analyze what type of jobs, or the income from the jobs.

The best way to create jobs is not through tax cuts, government spending, or any fiscal policy at all. Instead, it's through monetary policy. That expands the money supply, making more liquidity available to businesses to invest. Fiscal policy is only necessary when monetary policy is already as expansionary as possible. That happened in 2009 and 2010 after the Great Recession forced the Fed funds rate to zero.

 

[Money Trust]

Only way I can see tax cuts creating new jobs is if that money is being spent back into the economy by the people. That would in turn create demand and with higher demand comes the need to hire more people to fill that demand.

That's just my theory, though.

 

[algofy]

More money in the pocket of business owners that can use it to expand their business, which creates new jobs, or new yachts.

 

[CyJackX]

Tax cuts anywhere stimulate some growth, but I believe there is a very strong diminishing ratio of returns when it comes to where. High earner tax adjustments are negligible. Middle/lower class are great.

 

[southall]

or new yachts.

Someone has to build the yachts, so more jobs.

It is the misers who are mean and just want to hoard the wealth.

 

[Covertibility]

- Not misers but the marginal propensity to consume -

 

[cdcaveman]

Tax cuts anywhere stimulate some growth, but I believe there is a very strong diminishing ratio of returns when it comes to where. High earner tax adjustments are negligible. Middle/lower class are great.

Any tax cut is good.. taxes are by definition confiscations of value creating persons to redistribute to non value creating persons... Government does not create jobs it steals them from the private sector.. bureaucracy does not create value it destroys value it's a different set of incentives bureaucrats are incentivized to have more employees under them whether or not they are providing value or not sometimes it's better for them to have people that are doing less than more which enables them to have more people under them because they are not subject to the market test

 

[CyJackX]

Any tax cut is good..

But some tax cuts are much better than others.

 

[Martinghoul]

Any tax cut is good.. taxes are by definition confiscations of value creating persons to redistribute to non value creating persons... Government does not create jobs it steals them from the private sector.. bureaucracy does not create value it destroys value it's a different set of incentives bureaucrats are incentivized to have more employees under them whether or not they are providing value or not sometimes it's better for them to have people that are doing less than more which enables them to have more people under them because they are not subject to the market test

What about the police and the military?

 

[Martinghoul]

It's an open question and I have looked at a lot of literature on the subject. It's sort of a question about whether Ricardian equivalence is a thing and it's actually quite complicated.