Tax Cuts: A political victory?

[Gravitymaster 0]

Since the tax cuts:

1. Real GDP has expanded more than $1 trillion. Thats an 11% increase between the first quarter of 2003 and the end of 2005.

2. 5 million jobs have been created. Thats more than Europe and Japan combined.

3. Personal income has gone up 5.7%

4. Industrial Production is up 11% or $300 billion.

5. Between the 2nd quarter of 2003 and the end of 2005, 3.9 million businesses have been started.

6. The S&P is up 55% and the DJIA is up 42% and small Cap stocks have accounted for the biggest stock market increases.

7. After tax coporate profits are up 46% or almost $1.1 trillion.

8. Dividends have gone from $149 billion in 2003 to over $200 biillion now. S&P companies have had over 900 increases and more than 40 companies have paid dividends.

9. Capital spending has increased from $730 billion to almost $1 trillion, an increase of over 30% Cash flows have grown faster than ever before outstripping even capital expenditures.

10. Household assets are up more than $15 trillion with only an increase of $3 trillion in household liabilities.

11. Overall, National assets have grown 30% in 3 years to $160 trillion.

12. Tax receipts were up 15% last year.

13. The US has run trade deficits for 350 out of the last 400 years. Most trade involves transactions between commercial entities. I run a trade deficit with almost anyone I purchase from including the supermarket, gas stations, clothing stores etc.

To complain about trade deficits and tax cuts while at the same time ignoring capital inflows, personal incomes and corporate profits and increased tax revenue displays a very poor understanding of the entire economic picture.

[kelpdiver 2]

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6. The S&P is up 55% and the DJIA is up 42% and small Cap stocks have accounted for the biggest stock market increases.

ahem...the S&P continued its slide downward after the tax cuts were put in in 2001, hitting its last trough in early 2003 before rebounding now to what it started at in early 2001.

Getting back on topic, the growth in dividends is related to the tax rate change and is a reason to keep that change, imo.

[Gravitymaster 0]

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6. The S&P is up 55% and the DJIA is up 42% and small Cap stocks have accounted for the biggest stock market increases.

ahem...the S&P continued its slide downward after the tax cuts were put in in 2001, hitting its last trough in early 2003 before rebounding now to what it started at in early 2001.

Getting back on topic, the growth in dividends is related to the tax rate change and is a reason to keep that change, imo.

Correct. The S&P has been way up since early 2003. I don't consider anything between 2001 and then because of 9/11. In fact when reading a prospectus, I ignore that time frame focusing on the 3 year performance and long term only.

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[kelpdiver 2]

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Correct. The S&P has been way up since early 2003. I don't consider anything between 2001 and then because of 9/11. In fact when reading a prospectus, I ignore that time frame focusing on the 3 year performance and long term only.

It's fair to remove 2001-2002 for that reason. But I don't think you can then credit a rebound to any cause. What's to say it didn't just recover from that shock?

If it continues to grow beyond where it started, it's open season on the credit.

[Gravitymaster 0]

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Correct. The S&P has been way up since early 2003. I don't consider anything between 2001 and then because of 9/11. In fact when reading a prospectus, I ignore that time frame focusing on the 3 year performance and long term only.

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It's fair to remove 2001-2002 for that reason. But I don't think you can then credit a rebound to any cause. What's to say it didn't just recover from that shock?

It may have but when you examine the entire increase in the economic engine, it's a little hard to isolate one factor and attribute it to recovery from the shock of 9/11. I think if you go back farther into the 90's you have to admit tax cuts worked.

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If it continues to grow beyond where it started, it's open season on the credit.

So when would you attribute it to tax cuts? 6 months? 1 year?

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[idrankwhat 0]

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So when would you attribute it to tax cuts? 6 months? 1 year?
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Since I'm not trying to get elected to a political position, my issue is with the long term. Whoever is president next is screwed. Some of the tax cuts have helped the economy while other aspects are giveaways to wealthy donors. The main problem is the deficit. Greenspan warned us about that for about four years in a row. His warning about interest rates should feel strangely familiar after this week.
http://www.washingtonpost.com/wp-dyn/content/article/2005/04/21/AR2005042101518.html?nav=rss_business/economy