Quote:
Originally Posted by Sailor Steve
But at the same time you mock the idea of lower taxes fixing things, I don't see you addressing the opposite. Are you saying that higher taxes can fix everything? If that's the case then shouldn't you be advocating 100% of everything we make going to the government, and then the wonderful people we elect can decide how much we need to live on?
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Steve, that's a false choice argument. The opposite of saying "tax cuts fixes everything" is not advocating a 100% tax.
I'll explain why in a roundabout way of explaining the idea to kraznyi_oktjabr: the idea that lowering taxes is the answer is based upon the Laffer curve:
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Proponents say that by reducing the tax burden on people and businesses, they'll have more money in their pocket to spend on things, which boosts the economy and makes everyone richer. (In the diagram above, you're moving from "Point B" to the top of the curve, closer to the "Equilibrium point", thus increasing revenues.)
There are numerous problems with such an economic model - it sounds legit on the surface, but when you start examining history and budgets, it falls apart. Too boring to go into here.
The problem is that Republicans will always tell you that we're in the left side of the curve where tax cuts will increase revenue. Reagan dropped the top tax rate from 70% to 28%. But yet they still tell you we need to drop it further. They ignore their own model - at some point dropping taxes will end up in reduced revenues. (going from Equilibrium to "Point A") But that point is conveniently swept under the rug.
