Day after……….

Christmas in India:   Children dressed as Santa Claus participate in a peace march on Christmas Eve in Amritsar, India. (AP Photo / December 24, 2008)

Just because it is so basic… It’s Sirota, but as I said, basic:

[P]aterson defended his proposals by telling PBS’s Bill Moyers “that when you tax the wealthy in the downturn of an economy, you have an automatic link of a loss of job opportunities and then a loss of population.” The rationale sounds intelligently pragmatic—until you peruse the relevant data.

When New Jersey recently raised taxes on the wealthy, Princeton University researchers found that most of those who later left the state moved to places with higher taxes, meaning there is no causative link between levies on the rich and residential flight. Likewise, when New York temporarily raised high-income taxes after 9/11, the state added 127,000 jobs, meaning no link exists between higher taxes on the rich and job loss.

During times of surpluses, governors could get away with the unsubstantiated nonsense Paterson is peddling. But now, 43 states confront shortfalls, and because states cannot run deficits, the dollars and sense of these arguments matter. Lawmakers must choose what policy will create the best chances for economic recovery: spending cuts or tax increases, and if the latter, on whom?

The answer isn’t rocket science. As Nobel prize-winning economist Joseph Stiglitz says, “Reductions in government spending on goods and services (are) likely to be more damaging to the economy in the short run than tax increases focused on higher-income families.”  ….snipped and clipped….

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