Direct aid to families and individuals totaled $1.8T ($900B in direct checks, the rest in enhanced unemployment benefits, etc). There was also $1.7T in private business stimulus, $480B in medical sector funding (research, hospital support, etc), $280B in transit sector support (airlines, etc). ALL OF THAT is consumer spending from an economic perspective.
You said "
granting money for consumers to spend" for the COVID stimuls. This means stimulus checks. Now you want to also include business loans, unemployment, medical funding, transit support, etc? What do you think government spending actually is?
By that logic, most government spending is consumer spending. Social security is consumer spending. Medical care like medicare, medicaid, Obamacare subsidies, etc are consumer spending. Food stamps is consumer spending. Universal Basic Income is consumer spending. The government funding infrastructure or hiring companies to build airplanes/bombs/etc is consumer spending. Having government employees and paying them a salary is consumer spending.
This sounds like you are trying to change the definition of government spending into "consumer spending" to whatever definition is convenient for you.
I am fairly confident economists, especially conservative economists would be highly opposed to categorize all of that spending as "consumer spending" instead of government spending. Show me some reliable sources or major economists who calls stimulus checks, unemployment benefits, medical funding, etc "consumer spending" and not government spending.
You believe when a person spends money from a check, the economic effect is different if the check is labeled "unemployment" rather than "direct stimulus"?
You believe that when the government hires a accountant or engineer and pays them a salary, the money those people spend in the economy is labeled differently than private sector workers?
If yes, then you just contradicted your own claim that all this government spending is actually consumer spending.
If no, then you are saying hiring government employees and paying them a salary is not "government spending" and along with everything else you said, then most or almost everything the government does is basically consumer spending.
This is your confusion. When government spends money on itself -- or gives welfare dollars to people -- it does not add to GDP and (for the people thus supported) provides a disincentive to work.
You said stimulus checks, unemployment benefits, funding transit, medical benefits, business loans, etc are "consumer spending."
You don't realize that unemployment checks and stimulus checks are actually very similar to welfare in that they also have some effects on disincentivizing work? Unemployment benefits get criticized all the time as increasing unemployment and not being a stimulus to the economy and here you are defending it as "consumer spending"!
For example, see article quotes:
“How could anyone believe that unemployment benefits are the linchpin to economic growth?” said Jon Sanders, director of regulatory studies at the John Locke Foundation."
...
"Because unemployment benefits are a financial cushion for the jobless, they spend less time looking for work than the unemployed who have no benefits. Those without benefits, or whose benefits are about to expire, have greater incentive to seek work and spend more time looking for employment, the study said."
RALEIGH — A Congressional Budget Office report in 2012 to the U.S. House Committee on Ways and Means said unemployment benefit extensions actually "contributed to the increase in the proportion of unemployed people who have been seeking jobs for more than 26 weeks" during and after the recession.
www.carolinajournal.com
But when government lowers taxes by returning tax dollars to working individuals, it incentivizes further work. When it returns tax dollars to a business struggling during Covid and thus allows its doors to remain open, it increases GDP.
Except that isn't what they did during COVID. They increased spending and used deficit spending to send money to other taxpayers and businesses.
When you engage in a massive stimulus with deficit spending, you are not actually returning tax dollars to anyone. What you are actually doing is borrowing money from other nations/other people/etc [at a later high interest rate] to then pay yourself while your debt piles up.
you're ignoring entirely the latter part of the equation: when such stimulus is funded through deficit spending, the short term gain is more than counteracted by the long-term economic destruction of inflation.
I didn't ignore it. I mentioned it multiple times in other threads and my previous comment above. The COVID stimulus under Trump and Biden were high deficit disasters. The Feds lowering interest rates to near zero to prop up the housing market and encouraging massive borrowing were also disasters. If the Feds lower interest rates again it will also be bad.
Taxation is like pregnancy: there's no such thing as being a "little bit" pregnant. There is no magic level of taxation that's beneficial economically - all taxation is a drag on the economy; it's just a matter of degree.
Hence, your claims of "high taxes" is basically meaningless...especially when you never chose to define it and the last several presidents only made small changes to the tax rates.
the average person realizing a capital gain in Obama term 2 made that investment decision more than a decade earlier.
Irrelevant because capital gains taxes going up or down (especially the tiny changes done by Obama) is neither a good immediate nor long term correlator or predictor of economic booms or recessions. If you're saying it takes about a decade to see the effects due to how long people hold, then a decade after Obama's tax increase (2023-2024), we still saw decent economic growth.
Historically, capital gains tax rate never fell below ~25% from the mid 1930s all the way until the 1980s. It was as high as 40% at some points. Even in the 1980s, it was still at least 20% before then going back up to 28% for the 1990s. You really can't match those booms and recessions to capital gains or margin tax rates. All of the capital gains and marginal tax rates were way higher in the past for many decades.
I'll also note that the GDP gain in 2018 of 2.97% was higher than in any year of the Obama Presidency.
I'll also note that the GDP gain under Obama in 2015 was ~2.9%, which is only a ~0.07% difference from 2018, while Obama's deficit spending in 2015 was significantly lower in than Trump's deficit spending in 2018.
Obama's 2015 deficit was 439 billion. while Trump's 2018 deficit was 779 billion (77% difference). Adjusted for inflation, the deficit was 629 vs 1052 (67% difference).
So for that minuscule 0.07% extra growth in 2018, you increased the annual deficit by 67%-77%.
That is a terrible deal. Perhaps the worst deal in the history of deals.
This isn't even remotely correct. There were ZERO capital gains and income taxes for most of US history, and the initial rates when the IRS was first created had a maximum individual rate of 7% on income over $500K (that's $17 million in today's dollars) and a maximum corporate rate of just 1%.
I said the 1960s, 1970s, 1980s, and 1990s...which are the modern and RELEVANT history during a time when the USA had a modern economy and a federal government with responsibilities.
If you want to talk about history 100 or more years ago then obviously taxes were lower because the US didn't even have a standing military, the federal government was much smaller, and the government barely did anything if you go back long enough. But those are an entirely irrelevant timeperiod that contributes nothing to this discussion because we can't go back to the time when we literally had no standing military and relied on militias, and when many old people just lived in extreme poverty or died when they had no savings because social security/medicare didn't exist.
Look at some relevant timeperiods like the post-WW2 boom and during most of the Cold War. During the 1950s, the top marginal tax rate was around 90%. Then it was lowered to about 70% in the 1960s. Then it was lowered to about 50% in the 1970s. In the 80s-90s, it ranged from 30-40%, and is around that today.
Maybe Obama should not have raised taxes at that time or should have combined it with some spending cuts, but all of those people losing their mind over Obama increasing top marginal tax rate to 39% and calling it high taxes or socialism had absolutely no clue about historical marginal tax rates.
That's federal income tax only, and excludes social security taxes. Add in state and local income tax, sales tax, property tax, and all the other forms of taxes, and many individuals can pay 2/3 of their income to the government. Are you honestly going to try to claim that's a disincentive to work and excel?
Did Obama raise your state, property, and local taxes? Did Trump lower your state, property, and local taxes?
Since when did the executive of the federal government start controlling local and state governments too?
Are you honestly trying to bring in factors that presidents don't even control that is irrelevant to this discussion about federal tax rates and the effects of presidential policies on the economy?
are you able to upload some of those AU images you're so fond of? maybe some images of those pesky Europeans ramming the ramparts? still waiting for the image of the antifa mask you claim exist.
