Originally Posted by
Absolute
Not essentially, my friend. When we're talking about economic booms, a variety of factors come into play, including the governments role in handling regulation and managing capital derived from taxpayers. Booms can technically come from either end of high taxes or low taxes. For higher taxes, it will depend on how legitimate the government is operating all of their expenses. Creating employment through outsourcing of contractors and direct employment for development in the national infrastructure can create growth, yes. However, lower taxes for both consumers and businesses can also negate the fear of having too little.
The problem that we're facing right now all has to do with fear and how everyone is operating under tight pockets. Essentially, there are four variables that justify the factors of high or low taxes:
1) The competence that the government has in its regulatory procedures and how well it manages the capital from taxpayer dollars to produce economic growth.
2) The employment available for the unemployed.
3) The marginal cash versus debt that an average consumer holds.
4) The amount of confidence or fear in the average consumer or investor to purchase products/services or do direct investments in derivatives, securities, and the overall general exchange markets.
It boils down to confidence and competence, I'd say. What do you think, my friend?
The only predicament we run into is you're ruining the municipal structure for not just law enforcement and safety, but also education and infrastructure. The education sector is derived from tax levies produced by property taxes. Usually, they range only around two to three digits on an annual basis depending on where you live. You'll be noticing a lot of rises in tax levies since the federal government is currently tight.
If the municipal levies were removed and you just went straight to sales taxes, then you'd be paying enormous prices to make up for that loss in standard stores, whether they're retail or or restaurant. I don't know what the exact ratios would be, but instead of going out to Wal-Mart to buy groceries for $100, what if you had to pay up to 50% to make up for that lost tax margin? And with the current markets in their state of spiral, consumers don't have the exact purchasing power they did prior to this catastrophe.
What are your thoughts?