I was always struck a little weird by the leftist claim to inhabit "the reality-based community." Yesterday, I realized why. This is the same group of people who accept a basically Marxist methodology of economics and think that the solution to a recessed economy is to raise taxes. Reality-based community?
Listen, if you can't figure out why the Soviets failed and the socialism-lite nations of Western Europe have big problems with unemployment, reality is not the bottom line of your thought-life. Better to go back to the stoner thing.
9 comments:
Better to go back to the stoner thing.
I always assumed they never left ... it helps explain the unexplainable.
:)
Tlaloc, if you think supply-side is dead, you don't have a very good grip on the current state of economics. I think Alan and Ben could back me up in saying that supply side has become very prominent and has many new adherents. Like the former Soviet bloc, for instance.
In short, Reaganomics ain't dead and it won't be as long we're arguing about a top marginal rate of 39% vs. 36% instead of 90% versus 75% like in the pre-Reagan period.
You're a little out of your area on this one. But don't worry, I won't argue physics with you any time soon.
Another commenter told me you were a master googler, T-man. I have to differ with the folks at CBBP. There is no question that a lower tax is entirely capable of taking in more revenue than a higher tax. Literally no question. We can quibble over whether a 36% rate will bring in more revenue than a 39% rate, but I think it is clear that a 32% rate will garner more than a 70% rate, particularly over the long run.
This is the part where I would normally start screaming and tearing out my chest hair because you refuse to observe reality, but I've been there before and the patch is just now back in place.
The Kennedy tax cuts of the 60's demonstrate what I'm saying. Ditto the Reagan cuts of the 80's. In both cases we got economic growth and increased revenues.
Which reminds me that I've been meaning for years to point out how Bill Clinton cleverly raised taxes just to the point where he figured that the Laffer Curve wouldn't kick in - namely 60 for you and 40 for Uncle Sam.
Connie, no links are needed. After the election, "reality-based community" became a highly popular catch phrase with the Daily Kos, Moveon.org, and Michael Moore crowd. They were the "reality-based community" standing bravely against the inhabitants of "Jesusland."
Tlaloc, you've got to be kidding me on that 80's versus 90's revenue growth comparison. The 80's didn't feature a freakish bull market largely based on speculations about the internet's effect on business. In other words, the internet didn't become a household word in the 80's. That has an impact about as large as inventing the automobile.
That would be a variable you might want to control for.
Still easy, T. It's well documented the economy was in recovery prior to Clinton taking office. The increase in revenue you observe is accounted for by the fact that the economy was already growing. In addition, a higher tax does take in more money immediately before people begin to adjust their decisions and behavior accordingly. You also get more money right away when you kill the golden goose and take the egg she's sitting on, plus the one growing inside!
Finally, I already told you it's unclear to me that a 36% tax would necessarily take in more than a 38% one. What I was and am sure about is that a 36% tax will take in more revenue over time than a 70% one.
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