The Mechanism Isn’t As Simple As You Think, Ctd

A reader writes concerning CEO behavior:

The supply-side Repubs get it wrong at every opportunity. No rational CEO will build new plants or hire employees unless and until there is a demand for what they will produce. Do they really think, for example, that 3M will increase Post It Notes production simply because they may now have (after tax reform) the financial ability to do so?

Right. They’re assuming flexible demand when, in fact, there may not be any demand. In fact, the reader’s comment highlights the importance of helping the lower and middle classes, either through redistribution or better education / training.

I think right now any tax cuts will be funneled to the owners of the companies, the investors, in the form of dividends and share buybacks.

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About Hue White

Former BBS operator; software engineer; cat lackey.

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