In 1982, the first full year for Reagan’s policies, the economy shrank by 2%, the worst performance since the Great Depression. Investment — the magic transmission belt through which all other Supply Side benefits were supposed to flow — actually declined as a percent of GDP over the 1980s. Worse, Reagan’s Supply Side policies created the biggest budget deficits in history. The numbers tell the story.

Jimmy Carter’s last budget produced a deficit of $77 billion. At the time, it seemed huge. But Reagan’s first budget swelled the deficit to $128 billion. By the next year, 1983, it had exploded to $208 billion and was creating severe problems for the economy. By 1992, at the end of the “Reagan Revolution,” (under Reagan’s Vice President and successor, Bush, Sr.) the deficit was approaching $300 billion a year.

Annual deficits, of course, accumulate to the national debt. In 1980, the national debt amounted to less than $1 trillion. By the end of 1992, it had reached $4.35 trillion. In other words, the debt, which had taken over 200 years to reach $1 trillion, quadrupled in the 12 years of Supply Side Economics. A more complete, definitive repudiation of Supply Side’s claims could not be imagined. What went wrong?

According to Supply Side “theory,” tax cuts should go to the wealthy for only they can afford to use the extra income to invest in the economy — to increase its capacity to “supply” goods. But there is nothing to make sure they actually invest, especially in the U.S. economy. ” by Robert Freeman

If you give a dollar to a low income family, they will spend the dollar at a US supermarket; if you give the dollar to a rich person, they will invest it, some domestic but a lot of it in other countries. They may short the dollar, treasuries, or put it in a Swiss account or gold.

Save the tax cut for the rich BS for someone who didn't study economics, ok?

In 1982, the first full year for Reagan’s policies, the economy shrank by 2%, the worst performance since the Great Depression. Investment — the magic transmission belt through which all other Supply Side benefits were supposed to flow — actually declined as a percent of GDP over the 1980s. Worse, Reagan’s Supply Side policies created the biggest budget deficits in history. The numbers tell the story.

Jimmy Carter’s last budget produced a deficit of $77 billion. At the time, it seemed huge. But Reagan’s first budget swelled the deficit to $128 billion. By the next year, 1983, it had exploded to $208 billion and was creating severe problems for the economy. By 1992, at the end of the “Reagan Revolution,” (under Reagan’s Vice President and successor, Bush, Sr.) the deficit was approaching $300 billion a year.

Annual deficits, of course, accumulate to the national debt. In 1980, the national debt amounted to less than $1 trillion. By the end of 1992, it had reached $4.35 trillion. In other words, the debt, which had taken over 200 years to reach $1 trillion, quadrupled in the 12 years of Supply Side Economics. A more complete, definitive repudiation of Supply Side’s claims could not be imagined. What went wrong?

According to Supply Side “theory,” tax cuts should go to the wealthy for only they can afford to use the extra income to invest in the economy — to increase its capacity to “supply” goods. But there is nothing to make sure they actually invest, especially in the U.S. economy. ” by Robert Freeman

If you give a dollar to a low income family, they will spend the dollar at a US supermarket; if you give the dollar to a rich person, they will invest it, some domestic but a lot of it in other countries. They may short the dollar, treasuries, or put it in a Swiss account or gold.

Save the tax cut for the rich BS for someone who didn't study economics, ok?

Also, Obama's team seems to identify 75% of the stimulus being spent within the first 18 months. When an actual report gets released from the CBO that's what it will say. Too bad the Republicans blocked a stimulus package back in September/October. Some of these infrastructure projects would be coming online right now.

An investment tax credit would induce investment spending that may or may not have occurred in the absence of the credit crisis. There's no way of knowing whether the tax credit is encouraging investments that would make economic sense if financing was available, but that the credit crisis has made uneconomical, or whether the tax credit is encouraging investments that wouldn't make economic sense even if financing was available.