your assumption seems to be tax cuts do not cause more revenue.
Tax cuts reduce revenue in the short term. That's obvious. They may or may not, in any given situation, depending on a host of other factors, help to create an environment where revenues ultimately increase.
It is virtually impossible to quantify the degree to which any specific given factor affects macroeconomic indicators. Anyone who tells you otherwise is lying. You can twist numbers to support either side in the argument, but the numbers are just too general, and subject to too many influences, for the figures to mean much in either case.
The idea that tax cuts will automatically generate enough growth to cover revenue shortfalls is, to me, a dangerous thing. It encourages fiscal irresponsibility, and is too easily used in a manipulative way. Cutting taxes is popular, cutting budgets is not. If we make this assumption, we make it too damned easy for politicians to cut one without cutting the other, brushing the deficit problem away with the assumption that we'll just grow out of it. That kind of behaviour can become addictive for politicians, and there's a point at which it gets destructive. I much prefer to keep to the idea that the government should, to the greatest possible degree, keep its spendings reasonably close to its earnings. |
