May 16, 2006

WHAT DO SUPPLY-SIDERS HAVE ON THEIR SIDE BUT THE FACTS? (via Pepys):

The Return Of Voodoo Economics: Republicans Ignore Their Experts on The Cost of Tax Cuts (Sebastian Mallaby, May 15, 2006, Washington Post)

Nobody serious believes that tax cuts pay for themselves, as I noted last week. But most senior Republicans flunk this test of seriousness.

In January, George W. Bush declared that, "by cutting the taxes on the American people, this economy is strong, and the overall tax revenues have hit at record levels." Regrettably, this endorsement of what his dad called voodoo economics was not a one-time oversight. The next month, Bush told a New Hampshire audience, "You cut taxes and the tax revenues increase." [...]

The Republicans' only argument is that tax receipts have boomed in the years since the 2003 tax cut.


Over the 25-year period since Ronald Reagan introduced supply-side economics, federal income taxes have fallen to their lowest level as a percentage of GDP since 1942 and total federal revenues have fallen to their lowest level as a percentage of GDP since 1959 yet we've had uninterrupted economic growth since 1983. Yet Mr. Mallaby thinks it's supply-siders who need to defend themselves?

Posted by Orrin Judd at May 16, 2006 6:19 AM
Comments

But according to Old Media, this is the worst economy since Hoover, so clearly supply side economics has failed.

Posted by: Annoying Old Guy at May 16, 2006 11:12 AM

Oh, but OJ, you don't understand! This opposition to "supply-side" is a social argument now. Reagan upset the apple cart when he pushed it through, as everyone in DC "cut their teeth" on the malaise of the '70s, and it attendant Phillips curve (now mercifully discredited).

You don't upset the apple cart and not have to face social ramifications because you did so.

Posted by: Brad S at May 16, 2006 11:14 AM

Not only boomed, has the progressivity they desire.

Posted by: Sandy P at May 16, 2006 12:36 PM

"We shall, therefore, neither postpone our tax cut plans nor cut into
essential national security programs." -- John F. Kennedy

Posted by: Genecis at May 16, 2006 1:07 PM
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