What is Voodoo Economics?
Voodoo economics is a derogatory term used to describe the economic process known as supply-side economics. The term was used by then-presidential candidate George Herbert Walker Bush, in his fight against Ronald Reagan for the Republican nomination in 1980. Voodoo economics is a complicated system that uses tax cuts as incentives to saving and increasing labor. Supply-side economics focus on increasing the supply of goods and services. According to some economists, by increasing supply, you will increase demand. This may seem contradictory, but it is often true that a market flooded with products will induce lower prices for the consumers, as companies compete for business. Voodoo economics largely revolved around the lowering of taxes to encourage a higher rate of supply. In theory, higher taxes discourage work, as they reduce the amount of take-home pay after taxes. They also reduce savings, as the after-tax amount in a savings account is lower. Lowering taxes on labor will lead to
• Voodoo Economics A slanderous term used by President George H. W. Bush in reference to President Reagan’s economic policies known as Reaganomics. Before President Bush became Reagan’s Vice President, he viewed his eventual running mate’s economic policies less then favorably. Reagan was a proponent of supply-side economics, favoring reduced income and capital gains tax rates. Study Up! YES WE CAN TAKE BACK AMERICA!!!
