Trickle-Down Economics Must Die...

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Post by Rockhopper on Thu Nov 19, 2015 4:57 am

A fascinating look at the effect of the so-called "Trickle-down" and it explains why it doesn't work.

Every extra dollar going into the pockets of low-wage workers, standard economic multiplier models tell us, adds about $1.21 to the national economy. Every extra dollar going into the pockets of a high-income American, by contrast, only adds about 39 cents to the GDP. These pennies add up considerably on $26.7 billion in earnings. If the $26.7 billion Wall Streeters pulled in on bonuses in 2013 had gone to minimum wage workers instead, our GDP would have grown by about $32.3 billion, over triple the $10.4 billion boost expected from the Wall Street bonuses.

Source.

And a more technical description of how it is screwed towards the top.

https://en.wikipedia.org/wiki/Marginal_propensity_to_consume

Tim.
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Post by Lenzabi on Thu Nov 19, 2015 11:38 pm

Trickle down has failed hard.

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Post by Rockhopper on Fri Nov 20, 2015 10:48 am

It never worked in the first place Len and was never meant to. It was sold that way.

If you want an economy to expand, put the money into the bottom, it will quickly rise to the top but on the way through it enhances the lives of many people.

Tim.
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