Quote:
Originally Posted by Calgaryborn
It appears from the Reagan economic model that the more you cut taxes the more the economy grows. If you give a person a $500 raise they will spend the raise and borrow that much more. That investment will have an impact all the way down the line. Companies make more money when they are producing at full capacity and that has a trickle effect all the way down the line.
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Reagan wasn't the first to think of this model. In fact Hoover used the very same model right before the Great Depression. I think that different economic strategies work in different situations. I don't think "Reaganomics" will bail a country out of a recession and/or recession, however it might strengthen an already strong economy. The problem with Reaganomics during a recession is that the corporations just pocket the money because they don't want to spend it during slow times...