What really scares the big Zero is that that the sequester goes into effect — and nothing happens. It shows him up to be the world-class, Nobel Laureate liar that he is.

#thetedsystem

The Feds need to butt out and focus on the tasks oultined in the founding dcouments of our country.

So true. I simply tried to point out that the Laffer curve is grossly misinterpreted ( as Dan Mitchell said), by BOTH sides. Well known conservatives have been known to state, incessantly, that “reducing tax rates will increase tax revenue. It has been proven EVERY TIME it has been tried.”

Bunk.

Laffer never said any such thing. Dan Mitchell flat denies it. us citizen actually stated it more correctly “returns diminish at a certain point”. Revenues will (probably) not increase by the same percentage as the tax rate increase, and the increased rates will often have a negative effect on economic growth and employment. But there is usually not an inverse relationship, as Chriss Street implied (“raising taxes to pay for deficit spending destroys economic growth and results in lower tax collection.”)

Even more important, tax rate changes do not occur in a vacuum. There are many other factors which effect economic activity and tax revenues. In another video, Dan Mitchell says that even the phenomenal increase in revenues after Reagan’s tax cuts were likely NOT due entirely to the Laffer curve effect. The economic system is much too complex to isolate one factor as determining total tax revenue.

Besides, the 2% “cut” in spending is just a slight reduction in a projected increase, not an actual reduction from lasts years budget. The Defense Dept. and Federal Govt. as a whole will both spend more this year than last year so there is no real cut in govt. spending at all.

Keep in mind that the “Defense” Department accounts for 44% of global military spending. Does the U.S. GDP constitute 44% of global GDP? No, not even close. More like 20%. Large cuts in military spending are absolutely necessary no matter what that might do to GDP in the short run. We taxpayers can’t afford America’s unsustainable, imperialistic, meddlesome foreign policy any more. Period.

On the subject of tax rates vs. tax revenue even Arthur Laffer would admit that the so called “Laffer Curve” only applies under certain circumstances. So Dan Mitchell (and Douglas) are right about that. That doesn’t mean that Chris Street is wrong though. If you want an exhaustive explanation of the Laffer Curve from the horses mouth so to speak, follow the link below to an article at The Heritage Foundation. It shows that the concepts behind the Laffer Curve are subtle and complex and therefore unlikely to be understood by politicians or their media mouthpieces.

http://www.heritage.org/research/reports/2004/06/the-laffer-curve-past-present-and-future

P.S. Arthur Laffer is a big Jerry Brown fan, go figure. And if you want to see Laffer get his head handed to him watch the Laffer vs. Peter Schiff CNBC debate on YouTube. Poor Arthur, he really was as wrong as you could be about the housing bubble.

“Daniel J. “Dan” Mitchell is a libertarian economist, senior fellow at the Cato Institute. He is a proponent of the flat tax and tax competition, financial privacy, and fiscal sovereignty.

One quote does not prove a person’s position. I would say that your comment is “wildly wrong”.