After a CNN town hall debate on Oct. 18 between Senators Ted Cruz and Bernie Sanders on tax cuts, BYU-Hawaii Professor of Economics Gale Pooley said lowering taxes on the wealthy can help students secure a job after graduation.
Pooley compared current U.S. tax policy to a class. “If we applied current U.S tax law to the classes here at BYU-Hawaii, then 10 percent of the students would do 70 percent of the work and everyone would get the same credit. Is that fair? Today that is how our tax system is set up.
“Would you be happy in such a class? Would that 10 percent continue to come to class? No, at some point they would stop coming because it’s unfair, leaving the rest of the class to fend for themselves.”
Pooley explained how many individuals look at the wealthy and believe that they should pay more because they are able to, even though those people benefit from the wealthy getting richer.
If left unchanged, current U.S. tax policy could drive out many businesses that create wealth and jobs for the United States possibly making it more difficult for recent college graduates to find a job, explained Pooley.
At the CNN debate, Cruz, a Republican senator from Texas, highlighted the need for more young students to care about taxes – if companies are allowed to keep more of their money, they will have more money to hire new people like fresh college graduates.
Emma Andrew, a senior in business finance from Tennessee, agreed with Cruz and explained that a cut on taxes for businesses and job creators means everyone has a greater opportunity for work and better jobs.
“Any way the government can be less involved to allow markets to take their natural course, the better,” said Andrew.
Sanders, a Democratic senator from Vermont, explained the danger of the Republican’s tax plan and its potential to cost the U.S. government 1.5 trillion dollars over the next 10 years. Sanders labeled the Republican belief that the loss of these tax dollars would be made up in the growth of the economy as a “fraudulent theory” used to benefit the rich, whom Sanders believes should be taxed more.
“Sanders’ policies appear to be motivated by envy and not economic principles,” said Pooley, who explained the macroeconomic principle that higher tax rates do not necessarily equal a greater tax revenue.
Pooley used Ronald Reagan as an example of a president who cut taxes that led to a huge boost in the economy and a time of great prosperity.
According to Bloomberg, Donald Trump proposed a reform to current U.S. tax law that would cut the corporate tax rate from 35 percent to 20 percent, reduce the number of personal income tax brackets from seven to three, repeal the estate tax, and increase the child tax rate.