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"In addition to Hamliton's usual twaddle about corporate welfare and the need to fund what he considers "essential state services", he manages to say something completely contradictory.
At one point he states, " ..preposterous is the assertion that tax cuts will stimulate even more economic activity. Voodoo economics lives!"
OK. Maybe I'll rat-hole the extra money. Of course I could just sink it in my small retirement fund too. But that would be selfish and wouldn't stimulate the economy either. The fact with most people is that we are hard-wired to spend money. The more you make, the more you will spend (I'm sure you have seen this principle at work in your own life). And if you spend more you stimulate the economy. Therefore his assertion this does not work is much in doubt.
The kicker is a few paragraphs later, when he says, " ..they [states] can maintain their spending on the salary of workers, who then go out and spend their paychecks on the local economy".
Let me get this straight. A tax cut that allows me to keep more of my money, i.e., in effect giving me a larger paycheck to spend does not stimulate the economy. However, the state "spending on the salary of workers" (we can only assume he means public sector employees since those are the only kind that get a paycheck from the state) will stimulate the economy. Because those workers go out and spend their paychecks. What? Their money works differently than mine?
Makes no sense. No surprise though, since most of what Hamilton writes seldom does."
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