Difference between revisions of "Trickle down theory"
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(everyone in the economy will benefit?) |
(falsely attributed to Ronald Reagan) |
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'''Trickle down theory''' is the idea - falsely attributed to conservatives - that helping rich people will indirectly help the poor. | '''Trickle down theory''' is the idea - falsely attributed to conservatives - that helping rich people will indirectly help the poor. | ||
| − | :... if high income earners gain an increase in salary, then everyone in the economy will benefit as their increased income and wealth filter through to all sections in society.<ref> [http://www.economicshelp.org/blog/174/economics/trickle-down-economics/ The Economics Help Blog]</ref> | + | :... if high income earners gain an increase in salary, then everyone in the economy will benefit as their increased income and wealth filter through to all sections in society.<ref name=reagan> [http://www.economicshelp.org/blog/174/economics/trickle-down-economics/ The Economics Help Blog]</ref> |
| − | the theory that cutting taxes for the corporations and wealthy individuals will stimulate economic growth by increasing the amount of capital available to invest. Some argue that cutting taxes to the poor has a greater effect on the economy since almost all the money that they earn goes directly to buying products and services. President [[Ronald Reagan]] | + | the theory that cutting taxes for the corporations and wealthy individuals will stimulate economic growth by increasing the amount of capital available to invest. Some argue that cutting taxes to the poor has a greater effect on the economy since almost all the money that they earn goes directly to buying products and services. |
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| + | Many people called President [[Ronald Reagan]] a proponent of trickle down economics after he advocated cutting the [[capital gains]] tax rate, but | ||
| + | :He did not sell this policy on the grounds that ‘there will be a trickle down effect.’ However, opponents often claimed that this miserable ‘trickle down effect’ summarised Reagan’s economic policy<ref name=reagan> | ||
Actually, as economist [[Thomas Sowell]] points out, | Actually, as economist [[Thomas Sowell]] points out, | ||
Revision as of 13:55, December 5, 2016
Trickle down theory is the idea - falsely attributed to conservatives - that helping rich people will indirectly help the poor.
- ... if high income earners gain an increase in salary, then everyone in the economy will benefit as their increased income and wealth filter through to all sections in society.[1]
the theory that cutting taxes for the corporations and wealthy individuals will stimulate economic growth by increasing the amount of capital available to invest. Some argue that cutting taxes to the poor has a greater effect on the economy since almost all the money that they earn goes directly to buying products and services.
Many people called President Ronald Reagan a proponent of trickle down economics after he advocated cutting the capital gains tax rate, but
- He did not sell this policy on the grounds that ‘there will be a trickle down effect.’ However, opponents often claimed that this miserable ‘trickle down effect’ summarised Reagan’s economic policyCite error: Closing
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