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December 07, 2007
Annals of Good Reporting
Someone give Justin Fox a medal.
Update: Fox went to ask Arthur Laffer, who made the enormous mistake of thinking the conservative movement wouldn't go too nuts of a graph on the back of a napkin, and asked him whether tax cuts increase revenue. "I don't know," he said. Fox also found out:
The idea that high tax rates brought diminishing returns was not controversial or even new--Laffer traces it to 14th century Muslim philosopher Ibn Khaldun.
Which raises an interesting question: Would Mitt Romney consider Ibn Khaldun for a position in his cabinet? Which is stronger: His desire to pander by discriminating against Muslims, or his fealty to the anti-tax forces in the Republican Party?
December 7, 2007 | Permalink
Comments
Good lord. I had never realized that DICK CHENEY was literally at the table for the invention of the Laffer Curve.
Posted by: The Confidence Man | Dec 7, 2007 1:24:32 PM
Would Mitt Romney consider Ibn Khaldun for a position in his cabinet?
Now THAT is pretty damn funny.
Posted by: Tom | Dec 7, 2007 1:55:49 PM
All that is needed is the Libertarian overlay on the Laffer Curve to be adopted as GOP dogma: Zero taxes will be needed to fully fund the US government. (If all tax cuts are good, more cuts are needed until zero is reached). Call Megan with the scoop!
But guys, this Christmas Holiday Season, so lets not tell the kids that Santa isn't real. And there is counter-evidence: NORAD tracks Santa's journey every year on their radar, so to deny him would be a cowardly, traitorous yielding to the terrorists!
Posted by: JimPortlandOR | Dec 7, 2007 2:07:28 PM
OMG--I just got a reference in a poem title.
Posted by: SamChevre | Dec 7, 2007 3:01:20 PM
Laffer:
"You find these enormous responses in the upper brackets," Laffer says. "These guys fire their lawyers and accountants and actually pay their taxes. Yay! Isn't that what we want them to do?"
Is that really the way the curve is supposed to build revenue? That wasn't the impression I was under. It's probably true as it happened in the 1980s, but it has absolutely nothing to do with trickle-down economics or supply side economics in principle. Which is to say, its value as an argument with today's tax rates is almost zero, no?
Posted by: jhupp | Dec 7, 2007 3:35:20 PM
jhupp, that quote seemed curious to me, too. I can't tell if Laffer is unwilling to stand by the stronger claim, or if his recollection of the fable is just a little fuzzy in the retelling. The weaker claim is no less preposterous for that; it's highly unlikely that the loopholes generously foregone by the wealthy would raise their taxes to what they were before the cut. If so, why would they have objected to the higher rate?
Posted by: kth | Dec 7, 2007 7:22:43 PM
For some reason this site has never met a tax it didn't like and has disdain for the idea that (gasp) the government might reduce its spending and taxation requirements.
Despite being a favorite whipping boy for the democrats over the last 7 years, the tax cuts did stimulate the economy and contributed to an end in the recession during Bush's first term.
If measured purely on "did the tax cuts pay for them selves?", perhaps or perhaps not. But if measured on the question of "is the economy in better shape now then in 2003?" Generally yes.
Posted by: m | Dec 7, 2007 11:53:06 PM
The night of the fight, you may feel a slight sting. That's pride f*cking with you. F*ck pride. Pride only hurts, it never helps.
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Posted by: Randal | Apr 9, 2009 9:09:44 AM
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