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To: Sherman Logan
Tax cuts do not always increase revenue. It depends on where you are on the Laffer curve.

While the Laffer curve represents reality, it is not the correct measure to determine tax policy.

Think of a new plot, the CurlyDave curve, where we plot GDP vs. tax rate. We want to adjust tax rates to maximize GDP, not to maximize government revenues.

15 posted on 06/12/2011 7:56:42 PM PDT by CurlyDave
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To: CurlyDave

>> We want to adjust tax rates to maximize GDP, not to maximize government revenues.<<

You are right, but the point of supply side is to maximize personal production - the increased tax revenues are just a way to sell it and a way to point out the hypocrisy of the redistributionists. So, supply side is great theory, and balanced with a target % of GDP for all tax expenditures is fabulous.


16 posted on 06/12/2011 8:02:06 PM PDT by C. Edmund Wright (American Thinker Columnist / Rush ghost contributor)
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