Trickle down economics refers to the makers spending money to increase opportunities for those below them economically. Staving the system from collapse isn’t trickle down economics even though it’s the makers who also benefit. Preventing financial collapse can seem similar to the idiotic premise of trickle down economics and i can probably even understand the argument that it is though i clearly disagree
Trickle down economics failure was perfectly displayed by the trump tax cuts when the makers initiated stock buy backs instead of investing more.
The “trickle” metaphor predates Will Rogers; it can be used in lots of different ways. It’s a pretty open-ended figure of speech. But in its most precise modern form, it’s a pejorative term for a certain kind of “supply side” tax policy: the term supply side economics itself originated in the 1970s. David Stockman, Reagan’s budget director who was strongly associated with this view, thought about it like this in 1981:
. . . [T]he supply-side theory was not a new economic theory at all but only new language and argument to conceal a hoary old Republican doctrine: give the tax cuts to the top brackets, the wealthiest individuals and largest enterprises, and let the good effects “trickle down” through the economy to reach everyone else. Yes, Stockman conceded, when one stripped away the new rhetoric emphasizing across-the-board cuts, the supply-side theory was really new clothes for the unpopular doctrine of the old Republican orthodoxy. “It’s kind of hard to sell ‘trickle down,’” he explained, “so the supply-side formula was the only way to get a tax policy that was really ‘trickle down.’ Supply-side is ‘trickle-down’ theory.” The Education of David Stockman - The Atlantic
JFK was the one who cut the top tax rates (thereby being the first to implement “trickledown” economics in modern America) … but the left never gives him any credit
While I don’t know a lot about UK economic conditions (I think of it as slightly conservative compared to continental Europe)
What we know is that
in 2021 (different set of economic conditions)
a lof of companies including as many as 1 in 4 financial services companies were considering moving part or all of their business out of the UK. Continental Europe was named as the #1 destination they were considering,. (Picture below)
-and-
Right now (apparently driven by inflation and energy prices) a lot of companies, especialy factories, are looking moving from the EU altogether. (Link below picture)
Clearly any good European leader who deserves office should run away from any sort anti-rich or anti-corporate policies (those policies are failing agaon) and try to do something to attract business and investment. I am not surprised Liz Truss would advocates some sort of “supply-side” solution.
She’s got the right general idea.
Tax cuts are a lot like education spending. The costs are immediate. The benefits, if any, are long term.
I have also seen both done badly.
Bad education spending can used to build a school lobby or for politicized “equity” courses or simply for salary increases (more of the same, but at a higher price.)
Likewise tax cuts can be so narrowly focused that they sometimes produce little good for anyone except the direct recipients.
Yet it makes no more sense to say “tax cuts are bad” than it would to say “education spending is bad.”
Their economy nearly imploded in the past few days so UK wathers will find that photo funny.
What happened (in case it matters)
The sudden announcement of Trussanomic tax proposals sent the value of their long-term bonds tanking . . . unfortunately the UK public pension fund is heavily leveraged against UK 30-year bonds. It was nearly a Lehman moment.
Whatever it was he did wrong (violated COVID restrictions I think) he did not appoint a woke cabinet and then nearly destroy the UK retirement by suddenly in a surprise fashion announcing a rapid shift in policy.
Is it a coincidence that there is not a single white male in Truss’s entire cabinet?
In a country where more than half the people in power are white males?
Don’t get me wrong. I am a fan of supply-side economics when it is done right.
but any policy even the best policy is done wrong when, like a monarch, you keep your policy a secret ,then spring it on the economy like a royal decree.
