In Washington, Democrats and Republicans disagree on how best to jolt the economy out of its current recession, but they agree in principle on the need to cut taxes. Its Economics 101: if you slash business and personal taxes during an economic contraction, you ease the pressure on firms to cut costs by laying off workers and reducing investment, and you leave taxpayers more disposable income, which they can pour into investment or consumption, giving the economy a lift.
Did New York City politicians ever take Econ 101? In recession-hit Gotham, City Council members have been squabbling over the budget, but the conservatives want taxes to stay where they are, while the liberals want to hike them. No one is suggesting the tax cuts that even congressmen know are crucial. But maybe the council members do know that theyre defying the laws of economics and just dont care. They know they represent not all New Yorkers but only those who elected them: government workers, government-supported social services workers, and welfare recipients. The council members want to lessen the recessions effects on these dependents on the public purse; and if that means supporting policies that drain vitality from the citys private economy and limit opportunity for the majority of citizens, fine.