Suppyside economics has this simplistic idea that as you reduce taxes revenue will increae to make up the difference.
No. Supply side economics, related to taxes, is in its simplest form that if you reduce taxes, you get extra economic growth. NOT that it will always or even typically increase economic growth enough to make up the difference in revenue in the short run. Included in that would be the possibility that you can in the short or medium run, get enough extra revenue to make up the difference, but unless your also simplifying taxes, or unless your reducing taxes on investment from a moderately high or higher rate, or regular income taxes from a very high rate, this often won't be the case. In the long run its more likely to be the case, but in the long run tax plans don't stay stable, they will change multiple times.
The idea is that this additional growth is a net benefit, that economic growth should be the goal, not additional federal revenue.
Some politicians and commentators do indeed argue, that you will almost always (or even just plain "always"), get enough extra growth to push federal revenue to a higher level than it otherwise would have been without the tax cuts, but your taking statements by the most extreme supporters of the idea, as if those statement where the idea.
Until the 60's everyone on earth lived according to whatever dogma their parents and society presented to them at birth
Nonsense. |
