Overheating an economy supply-side style

[ksen]

Has it ever happened?

Given that the definition of an overheated economy is that it's growing too fast, and given that supply-siders use the argument that their policies promote growth, i.e. a rising tide lifts all boats, then how come we don't see economies overheating from the application of supply-side policies?

Instead we typically see economic growth slow when supply-side policies are implemented.

 

[coloradoatheist]

Can we first get a list of things you qualify as being supply side and then for demand side?

Many of the policies that the government tries don't fall strictly under either. As I pointed out on the other thread, Reagan both cut taxes but also increased government spending which is a demand side policy.

 

[ksen]

Can we first get a list of things you qualify as being supply side and then for demand side?

Supply-side: policies favoring capital

Demand-side: policies favoring labor

Many of the policies that the government tries don't fall strictly under either. As I pointed out on the other thread, Reagan both cut taxes but also increased government spending which is a demand side policy.

Right, so the argument is going to be that Reagan wasn't a true supply-sider? Or that the aggregate of our fiscal policies since around 1980 haven't been more capital than labor friendly?

 

[Nice Squirrel]

Can we first get a list of things you qualify as being supply side and then for demand side?

Many of the policies that the government tries don't fall strictly under either. As I pointed out on the other thread, Reagan both cut taxes but also increased government spending which is a demand side policy.

Reagan raised taxes and increased government spending. He cut taxes on the wealthy and increased them on everyone else.

 

[ZiprHead]

The real intent of supply-siders.

 

[Nice Squirrel]

Supply-side: policies favoring capital

Demand-side: policies favoring labor

Many of the policies that the government tries don't fall strictly under either. As I pointed out on the other thread, Reagan both cut taxes but also increased government spending which is a demand side policy.

Right, so the argument is going to be that Reagan wasn't a true supply-sider? Or that the aggregate of our fiscal policies since around 1980 haven't been more capital than labor friendly?

I'd go with this one:
Supply-side: policies favoring the oligarchy

Demand-side: policies favoring mass consumption

 

[ksen]

I was trying not to be too provocative so as not to scare the supply-siders away.

But yeah, yours works too.

 

[coloradoatheist]

Can we first get a list of things you qualify as being supply side and then for demand side?

Many of the policies that the government tries don't fall strictly under either. As I pointed out on the other thread, Reagan both cut taxes but also increased government spending which is a demand side policy.

Reagan raised taxes and increased government spending. He cut taxes on the wealthy and increased them on everyone else.

He did a lot with tax policy. His first tax cut was across the board for everyone. He raised payroll taxes to deal with SS shortfalls but Reagan also raised the capital gains taxes and closed many loopholes for the rich. He also hurt landlords with major changes in real estate. His tax policy was mixed.

I think ksen is also redefining things and I'm okay with saying either labor or business, but those weren't the missions of some of the policies.

 

[coloradoatheist]

Supply-side: policies favoring capital

Demand-side: policies favoring labor



Right, so the argument is going to be that Reagan wasn't a true supply-sider? Or that the aggregate of our fiscal policies since around 1980 haven't been more capital than labor friendly?

I'd go with this one:
Supply-side: policies favoring the oligarchy

Demand-side: policies favoring mass consumption

I disagree

Supply side....Removing barriers for businesses and encouraging business growth
Demand side...More money for purchases from business

 

[coloradoatheist]

The real intent of supply-siders.

For people who support supply side, the intent is to get the government out of running the economy.

 

[ksen]

So, no examples of supply-side policies, however you want to define them, causing an economy to overheat?

 

[coloradoatheist]

So, no examples of supply-side policies, however you want to define them, causing an economy to overheat?

But how many times would you say that the attempt by government was only supply side? Since most people consider it tax cuts, then the Kennedy Cuts and the Reagan cuts are the two times that the government has attempted supply side. Reagan cuts along with Kennedy's cuts will always be debated.

 

[ksen]

So, no examples of supply-side policies, however you want to define them, causing an economy to overheat?

But how many times would you say that the attempt by government was only supply side?

About as many times as I would say the attempt by government has only been demand side: 0.

So what? It's not about only doing supply-side policies or only doing demand-side policies.

The angle that since the government has never only pursued supply-side polices is disingenuous and is just an escape hatch to avoid the discussion I'm trying to have in this thread.

Since most people consider it tax cuts, then the Kennedy Cuts and the Reagan cuts are the two times that the government has attempted supply side. Reagan cuts along with Kennedy's cuts will always be debated.

Now only tax cuts are supply-side policy?

 

[coloradoatheist]

But how many times would you say that the attempt by government was only supply side?

About as many times as I would say the attempt by government has only been demand side: 0.

So what? It's not about only doing supply-side policies or only doing demand-side policies.

The angle that since the government has never only pursued supply-side polices is disingenuous and is just an escape hatch to avoid the discussion I'm trying to have in this thread.

Since most people consider it tax cuts, then the Kennedy Cuts and the Reagan cuts are the two times that the government has attempted supply side. Reagan cuts along with Kennedy's cuts will always be debated.

The government always has a lot of policies going on. But economists have spent decades arguing over how effective Reagan's policies were. We couldn't rehash the whole debate in a few lines.





Now only tax cuts are supply-side policy?

How many times would you say that the economy has been overheated? I would say 2.

 

[ksen]

Overheated economies are ones that grow too fast.

Supply-side policies are sold as economy growers.

Economic growth has slowed down since the 1980s and the victory of supply-side politicians.

So, how can supply-side policies still be successfully sold as being able to fuel economic growth when GDP growth has been trending down since the beginnning of their widespread implementation?

In fact, we're at a point in history where all the gains of what little economic growth there is is concentrated in a few hands at the top and we're trying to fight off deflation from anemic economic growth instead of inflation caused by rapid economic growth.

 

[dismal]

Overheated economies are ones that grow too fast.

Perhaps first task ought to be whether any serious economist has ever suggested this exists.

 

[ksen]

Overheated economies are ones that grow too fast.

Perhaps first task ought to be whether any serious economist has ever suggested this exists.

Suggested what exists? Economies that grow too fast and overheat?

 

[coloradoatheist]

Overheated economies are ones that grow too fast.

Supply-side policies are sold as economy growers.

Economic growth has slowed down since the 1980s and the victory of supply-side politicians.

So, how can supply-side policies still be successfully sold as being able to fuel economic growth when GDP growth has been trending down since the beginnning of their widespread implementation?

In fact, we're at a point in history where all the gains of what little economic growth there is is concentrated in a few hands at the top and we're trying to fight off deflation from anemic economic growth instead of inflation caused by rapid economic growth.

Because the period that can really be sold as supply side would be 1980-90 but we had other policies since then. The government implements 100s of policies but it's the few percentage points of a tax cut that has destroyed everything supposedly.

 

[PyramidHead]

It's the same as all the other policies that fail to produce their intended effect: supporters will say not enough of it was done, or it wasn't done in the right way, and opponents will point to the lack of results as proof that it never worked to begin with.

Supply-side tax breaks, for example, didn't produce runaway economic growth because (a) the top 1% weren't sufficiently saturated in wealth to cause the trickle-down effect, or (b) supply-side economics is bunk.

The demand-side economic stimulus didn't produce runaway economic growth because (a) we didn't spend enough trillions of dollars on the right things, or (b) demand-side economics is bunk.

 

[ksen]

Hey buddy, stop overheating my thread with dupe posts!