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To: Skeeter Bug who wrote (13174)	7/30/1999 10:08:00 PM
From: ahhaha	Read Replies (3) \| Respond to of 29970

Voodoo economics means this: If you lower taxes and provide incentives to produce, total revenues rise and so total taxes rise even though the tax rate falls. This and spending restraint are the only things that have balanced the budget. The Democrats thought cutting taxes would mean less tax revenues and so they thought that the argument had all the incantation power of Voodoo. The Democrats have one item on their agenda. It is to make sure the rich don't get any more even if that means the poor get less. How noble. The last thing they would ever admit is that making rich people richer helps the lower end more than any other action. When you understand that you have started to learn. That takes renouncing 95% of what is taught in the universities. The universities have an ax to grind and that means they are allies with the Democrats against the rich. The war they fight is called the war on wealth. The Democrats have the attitude that "your wealth is evil because you didn't work for it. Mine is good, because I slaved for it. I'm going to take your's away and give it to the needy. Think how noble that is and how great that makes me. I will have achieved the highest goal of western civilization: fairness. You may throw money now." The rich have the attitude that "if they want to take so much I won't invest in risk assets, instead I'll invest in tax shelters". So the outcome is the war of attrition and it is GDP which attrites. It doesn't matter whether GDP is growing. You can have it falling and we can be inflating. Inflation is based on whether people feel they can secretly cheat each other, not on macroeconomic variables although when inflation is rolling you usually have various of them in certain configurations. The configurations are completely quixotic and the FED can't know what they mean. The humorous thing is that they don't need to know. They only need to generate a regular quantity of money which reflects the effort of the people to produce. They can make great errors about that quantity, but they can't do the same with the cost of the quantity. The cost has to be determined by the free market and not by pretense to knowledge.