May 11, 2006
Fiscal policy cowbell
Can someone explain to me again why exactly supply-side economics doesn't work?
I'm sure we'll here a resounding change of heart from Andrew Sullivan on this.
Posted by Steve at May 11, 2006 08:44 AM | TrackBackIt only works when it's tried. someone explained the Laffer Curve to me when I was about 15 years old; and I immediately understood that it was undoubtedly correct. Tax at 0%, you get nothing. Tax at 100%, you get nothing. Tax too high and you get a point of diminishing returns.
Like I said, a bright 15 year old can grasp it.
If anything, we ought to keep reducing tax rates until revenues start to actually decline -- then we'll know we've truly optimized the tax rates. Anyone care to hazard a guess at what that rate might be? I'd like to know.
Posted by: The Colossus at May 11, 2006 09:07 AMHere's one explanation:
http://faireconomy.org/research/TrickleDown.html
Over a 50 year span, there is no correlation between growth in GDP or wages based on tax rates.
Posted by: LB Buddy at May 11, 2006 11:38 AM
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