Trickle Down Theory

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Trickle Down Theory

An informal term for a macroeconomic theory that a government can best promote growth by providing incentives for persons to produce goods and services. The primary way a government does this is by maintaining low tax rates so that investors and entrepreneurs may invest their money in production. Maintaining low tax rates on the wealthy is one of the most important and controversial aspects of trickle down theory; the theory states that if well off persons have the capital available to produce goods and services, they create jobs and thereby grow the economy. In other words, the growth "trickles down" from the wealthy to the remainder of the economy. Critics contend that this does not happen in reality and that the wealthy are more likely to keep, rather than invest, their money. In the United States, trickle down theory was crucial to the economic policy of the Ronald Reagan administration. See also: Keynesian economics, Monetarism, Thatcherism.
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Of course, nearly everyone knew the Republican tax plan was just another trickle-down scam--a massive and destructive financial giveaway masquerading as pro-growth tax reform.
"The economy is suffering from low growth and polarization as the link that makes the trickle-down effect work was severed due to a lopsided playing field.
For that 20 per cent, there is no trickle-down economy - just a breadline existence and zero-hours contracts.
Is this what Tories call the "trickle-down effect" from rich to poor?
Todd McCracken, president of the National Small Business Association, says lending restrictions on small business could have a trickle-down effect.
Trickle-Down Theories A sculpture of the humpbacked flute player Kokopelli was removed from the front of Edge of the Cedars State Park Museum in Blanding, Utah, after complaints from a local group calling itself the "Values Committee." Despite the fact that the sculpture is quite abstract and minimalist in its presentation of the male form, the townspeople thought they saw an offending appendage, on obscene branch of what amounts to an artistically reorganized tree.
In the working classes, we have waited since the 1980s for the promised trickle-down from the boom and now, before it reaches us it has been taken over by the tsunami of bust.
With a trickle-down series of market crises following on the heels of the housing market woes of this past year, cash-flow projections for commercial and residential properties are being greatly reduced as an even greater economic slowdown is predicted into 2009.
In stark contrast with Nazif's views, lawyer and partner in Baker and McKenzie Taher Helmy, in an interview with Daily News Egypt, said: "I do not believe we should draw on trickle-down economics, because it's slow by nature.
If ever a place exposed the lie of the 'trickle-down' effect whereby huge amounts of money at the top of the ladder are meant to filter down to the lower rungs, it is Newmarket.
"There seems to be a feeling that if we get that right, there will be a trickle-down economic effect across the whole of the North.