So, a big Guardian piece about how lower taxes for the rich are just neoliberalism, Maaan.
A young journalist named Jude Wanniski had an epiphany when at a lunch meeting, he watched the economist Arthur Laffer draw a curve on a napkin to argue to the Ford staffers Dick Cheney and Don Rumsfeld that cutting taxes could raise companies’ revenues.
No, the curve shows that lower rates could – note could – increase tax revenues.
It’s entirely agnostic about corporate revenues. And if they’re going to get that wrong then the rest of their analysis is going to be, well….
Which it always was going to be. It’s from David Sirota. He who thought Chavez did a good economic job:
No, Chavez became the bugaboo of American politics because his full-throated advocacy of socialism and redistributionism at once represented a fundamental critique of neoliberal economics, and also delivered some indisputably positive results. Indeed, as shown by some of the most significant indicators, Chavez racked up an economic record that a legacy-obsessed American president could only dream of achieving.
In other news, making umberellas cheaper reduces rainfall.
The piece acknowledges that Chavez “accomplishment” was accompanied by an increase of violent crime. Revenue from crime is invariably tax free. The more you increase taxes on people the more ways they find to avoid paying that tax. Which is another demonstration of the Laffer curve in action.
How demented do you have to be to believe Chavez was a success?
Marius, that depends on your definition of “success”. See also: “growth”. And, er, “kindness”.
The focus on the second half of the laffer curve can only be willfull ignorance at this stage given this has been explained so many times and is so simple to understand. That there is an optimal configuration of taxes to maximise tax revenue over a given time horizon is just an indisputable fact. What that configuration is, and what a realistic period should be are the unknowns.
Ironically, optimising tax revenue and optimising growth are exactly the same thing over a sufficiently long period, as this implies tax is only used for public goods and where the state is better at doing certain activities than the alternatives.
When you have no toilet paper, it’s hard to appreciate indisputably positive results.
If Chavez was such a success, why are there so many Venezuelans here?
Because his success was in getting rid of the surplus population, MG???
Chavez made a success of the Venezuelan economy? Odd that the little smuggling operation across the Colombian border I helped finance has been so remarkably successful. Maybe it’s carrying Venezuelan currency to CO & selling it as toilet paper?
optimising tax revenue and optimising growth are exactly the same thing
I’d like to see good evidence of that contention.
Even the weaker version of the claim needs proving by a bright academic, this would be “optimal tax revenue and optimal growth are exactly the same”. It’s a more passive claim, without the State trying to optimise (no thanks to that), and possibly believable but whose tax revenue (national, local, parish, church, or wife) is also important.
tax cuts for the rich have been the glue holding the US conservative movement together.
LOL! LMAO, even.
What I don’t understand is the conflation of corporations & the rich in these sort of pieces. Corporations are owned by their share/stock holders. The majority of their equity are held by various forms of savings/pensions/insurance interests. So the after tax dividends they distribute benefit the complete range of wealth/income bands bar the absolute penniless.
Yes, there’s persuasive arguments that officers of corporations are excessively compensated. But that’s an entirely other thing & has no connection with corporate tax rates.
@Mike Finn – “optimising tax revenue and optimising growth are exactly the same thing”
What are they? Is optimisation of tax revenue maximising the total tax in the local currency (so improves with rampant inflation), to tax as a percentage of GDP, the tax value measured as purchasing power against some fixed item (gold, Big Macs etc), or what?
Some people might consider that tax is optimised when it is the least amount necessary.