The Election

Greg Mankiw presents the National Taxpayers Union’s grade of Nancy Pelosi. The bugbear specter Seems lessened by the fact she is a Stylish Electee chosen in the days of little competition. The Democrats would be the first to dump her, if she could not manage the position. Radicals always perish in the realm of Deal-making.

Andrew Chamberlain attempts to portray the U.S. as backward because We are not lowering Corporate Tax rates. Is it wise to lower Corporate Tax rates? Andrew implies it is, I can present some serious doubts. Boom Economies have been attained in the United States with even higher tax rates overall. Cactus at Angry Bear(see my previous Posts for a link) has used the numbers to prove that constant Tax rates seem the best economic incentive over the last 25 years. The Worldwide trend in lower Corporate tax rates stands as a loser, in that Cash Flows in Investment are not significantly altered (the proposed shift inward). Lower Corporate Tax rates, on the other hand, throws the tax burden onto Consumers (The touted European countries who have lowered Corporate tax rates all suffer from insufficient Consumer Demand).

We do not need to lower Corporate Tax rates in the U.S., but We need to sincerely eliminate all the tax loopholes, tax credits, and manipulated Accounting Expenses (like interior Corporate Tax divisions paying each other and deducting the payment as an Expense while the Parent Corporation also deducts it as an Expense). Will either Party in power move to stop such practices? No–they like large political campaign contributions too well!

Rithholtz at The Big Picture may have the most balanced assessment of tomorrow’s Election. The big Middle Incomes (they making the bloc of American who do vote) are the losers of the new Economy. They also make up the bloc of Republican Call-Out Voters. None of these Voters can seriously believe that Democrats would raise their Taxes substantially, but All of these Voters (if they vote with their Pocketbooks) will decide the Republicans have done nothing for them, in either the Economy or Iraq. lgl