Growth And Tax Cuts
Wall Street celebrated Friday when it learned the nation's gross domestic product - a measure of economic activity - posted slower growth. The slowdown means the Feds will be less likely to raise interest rates again, a benefit to businesses.
But the slowing economy tells us more than that.
Second-quarter growth fell to 2.5% from 5.6% in the first quarter. The substantial drop came amid a continued rise in prices, which complicates the Fed's decision. Among the Federal Reserve Board's major goals is to contain inflation.
The New York Times reported Saturday that a sharp slowdown in the housing market helped curtail the quarterly GDP number. The roaring housing market of the past several years, and the paper wealth it has brought Americans, has been fuel for the modest economic recovery seen during the mid years of the Bush presidency.
Bush argues his tax cuts for the wealthy have been the other accelerant in the US economy. Whenever a good economic report comes out, Bush extols the cuts as the reason for the good news.
Shouldn't we then be skeptical of the power of the cuts when we see a report like the one on Friday? What's your opinion? Does cutting taxes for the wealthy lead to faster economic growth?
Wall Street celebrated Friday when it learned the nation's gross domestic product - a measure of economic activity - posted slower growth. The slowdown means the Feds will be less likely to raise interest rates again, a benefit to businesses.
But the slowing economy tells us more than that.
Second-quarter growth fell to 2.5% from 5.6% in the first quarter. The substantial drop came amid a continued rise in prices, which complicates the Fed's decision. Among the Federal Reserve Board's major goals is to contain inflation.
The New York Times reported Saturday that a sharp slowdown in the housing market helped curtail the quarterly GDP number. The roaring housing market of the past several years, and the paper wealth it has brought Americans, has been fuel for the modest economic recovery seen during the mid years of the Bush presidency.
Bush argues his tax cuts for the wealthy have been the other accelerant in the US economy. Whenever a good economic report comes out, Bush extols the cuts as the reason for the good news.
Shouldn't we then be skeptical of the power of the cuts when we see a report like the one on Friday? What's your opinion? Does cutting taxes for the wealthy lead to faster economic growth?
posted by Mark Boslet at 1:22 PM
0 Comments:
Post a Comment
<< Home