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Unformatted text preview: Problems with Trickle DownOften Called Supply Side Economics. This is generally the philosophy behind conservative approaches to welfare. This is the philosophy that economic policy should focus on limited public services and low taxes for corporations and upper income earners. The idea is that lower taxes on businesses and upper income individuals and families will allow them to invest in productivity, creating jobs. As this happens the economy will grow, meaning that taxes are lower but the economy is bigger. Lower taxes on a larger economy will produce as much revenue as higher taxes on a smaller economy. What does the hard data show? A. In actual practice low taxes on high incomes or wealth has meant that wealth becomes concentrated in the hands of a smaller and smaller proportion of the population. Here the data are clear and well documented (Google Distribution of Wealth and Distribution of...
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- Spring '09