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Politics : American Presidential Politics and foreign affairs -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (44899)	8/16/2010 4:38:18 PM
From: DuckTapeSunroof	Read Replies (1) \| Respond to of 71588

Re: "Even if we could, I don't think we should aim for the revenue maximizing rate...." I'm not sure how one would go about precisely measuring the 'revenue maximizing rate' for taxation anyway... should it be the near-term rate tax level or the long-run level that produces the greatest revenue? If the question were put to me, (all due respect to the previous various formulas you listed that others have come up with), I'd argue for using the best long-run estimate of what level of taxes produces the greatest revenue over the long-run... because that would depend MOSTLY on which level of taxation produced the HIGHEST GROWTH LEVELS for the economy, which I believe the main goal should be anyway. So, I don't believe that 'maximizing revenues' should be the primary policy aim (although current revenue cannot be ignored).... MAXIMIZING ECONOMIC GROWTH should be the primary goal and, (of course), that is entirely consistent too over both the mid-term and the long-term with not amassing higher and higher deficit borrowing, because piling deficits higher and higher means adding higher and higher interest costs for that debt onto the backs of future budgets... which in and of itself would tend to decrease economic growth levels (and push private sector interest costs higher too by the 'crowding out effect' as government borrowing sapped the ability of private enterprise to finance capital improvements necessary for growth). So: IMO, the proper 'Laffer Level' for taxes is A). the level producing the highest economic growth over the long-run, B). coincident with a revenue/spending balance that does not increase national debt. Takes two wings to fly....