Nobel prize-winning economist debunks right-wing economics - 2019-10-30
By now we are all familiar with the usual economic talking points of right-wing politicians. They tell us, with the utmost confidence, that cutting taxes for the rich will incentivize investment and job creation. The lower the corporate tax rate the more people these benevolent corporations will employ. That, in a nutshell, is the mantra of conservative economics.
Abhijit Banerjee, this year's winner of the Nobel prize for economics, begs to differ. His work suggests that not only does this strategy intensify economic inequality, it also doesn't do much to induce economic growth.
As he puts it, "You don't boost growth by cutting taxes, you do that by giving money to people." Modest increases to the taxes paid by the wealthiest could fund welfare programs that put more money into the pockets of average folks. They, in turn, return this money into the economy in the form of consumption. It is their spending which increases demand for goods and services and boosts investment, jobs, and overall growth.