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Originally Posted by saden1
This sounds all peachy but are tax cuts a good long term solution and how long should we rely on tax cuts to "stimulate" the economy? Should the tax cuts be permanent? Do you expect the increase tax revenues to eventually balance the budget? How long should the government be in a deficit?
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Tax cuts are the best long term solution for the generation of jobs. Tax cuts are not a one-time shot in the arm. Think of the government like a dam in a river, where the dam opens and closes the flow of money coming downstream to the town below where all the corporations and citizens live. As the government increases taxes, they choke off the river, and money's a little harder to come by to the town folk. It gets harder to fish and you can't irrigate as many crops because you don't have as much water (money to invest with) at your disposal. But when a tax cut comes along, the government eases the dam, and money flows more freely. As long as the tax cut is in place, more money continues to flow to our businesses, and they continue to put those resources to use.
A tax rebate on the other hand, is like when someone comes along and dumps a big bucket of water (money) right along the shore where the people live. It's a one-time thing. You can use it to water an extra field and get an extra field's worth of corn that year, but once you use it up, you're back to dealing with the same choked-off river you were before.
So yes, the tax cuts should be permanent.