Fueling corporate greed

‘The Benefits Do Not Trickle Down': Reaganomics Bad For The Economy, IMF Argues

The International Monetary Fund just blew a big hole through trickle-down economics.

You’ve probably heard of trickle-down economics: It gained popularity in the 1970s and was a major part of the pro-business “Reaganomics” agenda of the 1980s.

The theory is simple enough: If you concentrate capital (money) at the top of the economic ladder (among the wealthy and corporations), that money will be more productive than it would be elsewhere, and it will create work and therefore income for everyone else.

Whether it was sound or not, it was a compelling theory for many in the business and political world, because it meant, among other things, tax cuts for top earners. And it was used for years as part of the foundation for successive corporate tax cuts around the world.

But now the IMF is raising one little problem with the theory: Apparently it doesn’t work. That’s the argument in the fund’s new research paper, “Causes and Consequences of Income Inequality.”

READ MORE: http://www.huffingtonpost.ca/2015/06/16/imf-trickle-down-economics-inequality_n_7595860.html