America's low savings rate

Jordan Hayes jmhayes at j-o-r-d-a-n.com
Mon Aug 20 09:28:01 PDT 2001


Lawrence asks:


> isn't it important to get as many people as possible saving
> what they can?

Actually, I think I'd like to see the people in the lowest income levels spend more. We can start by removing Federal taxes at those levels. Saving the difference is probably less good than spending it: a small amount of savings wouldn't go very far, and poor people tend to spend in their neighborhoods, which brings on a double positive impact of a raise in living standards for both the spender and the local merchants.

Savings for people of limited income seems a bit puritanical.


> Or do you want to live in a country where
> everyone is just one step away from the brink of disaster?

I don't think it has to be a disaster; my feeling is that the haves ought to provide for a safety net for the have-nots. I'm not sure that "saving" figures into that equation. It's a different question: what do we do to help those who stop being able to provide for themselves? I'm sure the answer is not: encourage them to save.

/jordan



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