Invested wealth will grow the economy

Dear Editor:

With about 40 percent of the wealth in the hands of one percent of the population, it would benefit the economy and create jobs if they would invest that wealth. One way government could encourage this would be to reduce their taxes so they spend more money. This is precisely what the Bush era tax cuts — specifically those for the wealthiest Americans — were meant to do. Unfortunately, instead of invest that wealth, they have generally saved it. With the economy on shaky grounds, they are continuing to save their wealth rather than risk investing in the type of investments that create jobs. The general pattern, and logical thing to do in a weak economy, is to save their wealth.

Since the wealthy are generally doing the rational thing and keeping their money safe, it would make sense for the government to raise taxes on the wealthy so the government could take that wealth and invest it. Government investments in the past have resulted in things like interstate highway system, satellites for communications and navigation, and the Internet.

These investments have since been used by the private sector to be more productive, grow the economy, and create jobs. There is no way to know what the next innovation will be that the private sector uses to create job. But, if the private sector isn’t investing in a way that will create that innovation, the public sector (i.e. the government) should.

T.J. Green
Cambridge

  • Lane

    There is also that pesky matter of the enormous national debt of which a significant portion is due to reduced revenues from the unwarranted Bush/Obama tax cuts. One could argue that we borrowed money from China to finance those tax cuts so that the wealthy won’t have to pay their fair share. Meh.

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