Ron Paul stimulus package doubts

[Mahkato]

Could anyone respond to these points from this take on Paul's economic plan?

Article text:

Paul's proposals to cut taxes on business may not stimulate the economy, which is dependent on consumer spending. Businesses may not pass the savings onto consumers in the form of lower prices.

His proposals to cut taxes will eliminate revenue. Without other proposed forms of revenue, it will increase the budget deficit and weaken the economy. This will put downward pressure on the dollar and increase inflation.

Reducing troops will decrease spending, but will it be enough to counteract lower revenue? Withdrawing from the WTO and other trade organizations, and withdrawing troops, may hurt our trade relations with Europe and other countries. They could retaliate by raising prices, thus increasing inflation, and adding tariffs, thus decreasing our ability to export.
Paul's proposal to create gold and silver currency would have no effect on the economy unless Paul were attempting to return the country to the gold standard. If each coin could be redeemed for its weight in the precious metal, then all gold coins would be redeemed when the price of gold sky-rocketed. Since the global economy is dependent upon floating exchange rates, a return of the U.S. to the gold standard would isolate the economy from global trade. It would be unworkable.

Likewise, televising FOMC hearings, or eliminating the Federal Reserve, would cripple the economy and isolate it from global trade.

 

[ARealConservative]

Could anyone respond to these points from this take on Paul's economic plan?

Article text:

His take on troop reductions is incorrect. A reduction in troop spending in total, and an additional injection into our economy by having more troops stateside is a net positive for the economy.

And his take on the gold/silver issue is way off. The stimulus proposal asks to simply legalize gold and silver as a currency - which removes gains tax and sales tax from the equation. The only other aspect is to shine more light on how the government meddles in the market.

If that last point harms the economy, that means they were committing fraud to prop it up in the first place.

He claims a reduction in taxes will not stimulate more business growth, yet offers no evidence to back up his assertion.

What you got there is a Keynesian quack.

 

[PepperdotNet]

just like reducing taxes hasn't helped the economy every time it's been tried. what an idiot.

less taxes = more money in pockets
more money in pockets = more spending
more spending = more revenue

simple really

 

[NaT805]

just like reducing taxes hasn't helped the economy every time it's been tried. what an idiot.

less taxes = more money in pockets
more money in pockets = more spending
more spending = more revenue

simple really

Exactly.

 

[INforRP]

His proposals to cut taxes will eliminate revenue. Without other proposed forms of revenue, it will increase the budget deficit and weaken the economy. This will put downward pressure on the dollar and increase inflation.

Cutting taxes permanently would cause a lot more personal spending than a 1 time handout that we borrowed from the Chinese. People aren't going to let go of their money from a 1 time event as they would if it was an ongoing increase in your wallet. Personal income tax only accounts for about 1/3 of the revenue anyway, there are plenty of other revenue streams that the govt relys on. Basically personal income taxes pay the interest we owe the federal reserve, which is a flawed and fraudulent system.

As far as gold and silver, Paul wants to introduce this as alternate currency to compete with the dollar, so we would get to see it's effectiveness. What would be the downside in trying? (besides the obvious loss of revenue for London bankers who are scamming us currently). But if it doesn't work, then it won't compete with the dollar and we have lost nothing. We all know competition is good for the consumer. Even if all we did was print our own money (meaning if the Govt printed it, instead of the privately owned federal reserve who then charges us interest), we would do better than the Fed is doing. Look up the success of the colonial script that the colonies used.

As far as the value of gold goes, I'm not sure the price of gold has gone up as much as the dollar has fallen. I saw a report a months ago that stated that the cost of gasoline has gone up 300% vs the dollar, in the time it has increased only 200% compared to the Euro and it has not gone up at all compared to gold. So I think the issue is more that the value if a dollar has fallen so much, not that gold has skyrocketed. Gold is like an anchor to keep your finances from not losing value...such as what happens when the dollar falls.

When the price of oil is tied to the dollar and they make dollars worth so little that the price of oil in dollars is real high, they can then charge more for oil everywhere. That was the goal, not just to over charge the US. Oil selling for more /barrel in dollars (because the dollar is worth a lot less), means they can charge more for oil everywhere, not just here.