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...They're going to try to use the current situation as supportive of Laffer's theory if receipts rise, but fail to disclose that these were deferred tax obligations that weren't being taxed.
The Laffer Curve does not need support. It is self-evident. See my first post in this thread above.
The Laffer Curve does not need support. It is self-evident. See my first post in this thread above.
It's been debunked over time. The people who defend the tax cuts often use misleading information on the basis that the Laffer curve is a legitimate theory.. As I stated, it plays too loose with facts and terminology to be taken seriously. It is junk science, in other words.
Arthur famously drew the the now-famous curve on a napkin at a Diner to explain a very simple concept that is ineluctably self-evident:
At an income tax rate of zero, no tax dollars are collected. No one who passed Econ 101 disagrees with this.
At an income tax rate of 100% (or higher), no one has an incentive to work, and thus no tax dollars are collected. No one who passed Econ 101 disagrees with this.
At every income tax rate greater than zero but less than 100%, some tax revenue is collected. No one who passed Econ 101 disagrees with this.
THEREFORE, as surely as night follows day, there exists at least one tax rate (possibly more than one) for which the total tax dollars collected will greatest. Anyone who passed geometry and calculus and econ 101 agrees.
That's it.
None of the above has been debunked. Not a single thing.
...or is at least misunderstood.
....
Basically, any ******* off the street can see that using Laffer to justify any new tax cuts is hilariously invalid. I can see how Kennedy lowering income tax rates from 90% would increase revenue. I can't see how Trump lowering corporate tax rates generates any increase in revenue. In sum, the theory is not inherently wrong, it's just exploited to encourage poor fiscal policy.
Poor fiscal policy, seriously?
Laffer-shmaffer... The federal budget has run a deficit for 46 out of the last FIFTY YEARS!
Isn't it obvious that expenditures have long ago been decoupled from tax receipts?
Laffer-shmaffer... The federal budget has run a deficit for 46 out of the last FIFTY YEARS!
Isn't it obvious that expenditures have long ago been decoupled from tax receipts?
And I'm supposed to start worrying now?
HAHAHAHAHAHAHA!!
Ah, another who understands modern money!
IMO Laffer is some common sense when applied to those that think federal taxes are necessary to run the federal gov't and its programs. It takes some uncommon sense to understand modern money.
Federal taxes are there first and foremost to control the people and business.
They are there to ensure value of the currency. We all have to work and produce X numbers of days per years simply to pay our taxes.
And they can be used to quell inflation by removing spending money from our pockets.
IMO Laffer is some common sense when applied to those that think federal taxes are necessary to run the federal gov't and its programs. It takes some uncommon sense to understand modern money.
Federal taxes are there first and foremost to control the people and business.
They are there to ensure value of the currency. We all have to work and produce X numbers of days per years simply to pay our taxes.
And they can be used to quell inflation by removing spending money from our pockets.
Excruciatingly slowly. Does that make three of us now?
Some colonial empire discovers Aztec gold and Peruvian silver , stake's a claim to it by force and then dumps it on the Eurocentric global economy and this is referred to as "sound money". What does it sound like to you?
Its basically refined rocks put back into a hole and it was never any more public than anything the dictatorial powers set their eye upon including whale blubber. After they dumped refined rocks on the market the idea was to scramble to get it.
Now da gubermnet dumps sovereign debt on the economy but maybe I think we should have followed Keynes idea and buried suit cases full of cash all around the country and let people mine it, ya know instead of giving it to bankers with a talent to misplace or steal it.
It's been debunked over time. The people who defend the tax cuts often use misleading information on the basis that the Laffer curve is a legitimate theory.. As I stated, it plays too loose with facts and terminology to be taken seriously. It is junk science, in other words.
It is absolutely a "legitimate" theory. While there are some problems with the curve, I've never heard an economist declare it as "debunked," including my esteemed professors. If you have concerns with it perhaps you can share!
Arthur famously drew the the now-famous curve on a napkin at a Diner to explain a very simple concept that is ineluctably self-evident:
At an income tax rate of zero, no tax dollars are collected. No one who passed Econ 101 disagrees with this.
At an income tax rate of 100% (or higher), no one has an incentive to work, and thus no tax dollars are collected. No one who passed Econ 101 disagrees with this.
At every income tax rate greater than zero but less than 100%, some tax revenue is collected. No one who passed Econ 101 disagrees with this.
THEREFORE, as surely as night follows day, there exists at least one tax rate (possibly more than one) for which the total tax dollars collected will greatest. Anyone who passed geometry and calculus and econ 101 agrees.
That's it.
None of the above has been debunked. Not a single thing.
It is far from obvious that no one has an incentive to work at a tax rate of 100%. There exist tribal societies even today that largely lack any form of quid-pro-quo compensation for labor. Yet people still hunt, harvest, cook, etc. in said societies. That said, government revenue in its own currency would indeed be zero since any quid-pro-quo exchange of labor for goods would take the form of bartering. So the Laffer Curve still stands (but for a slightly different reason).
It is absolutely a "legitimate" theory. While there are some problems with the curve, I've never heard an economist declare it as "debunked," including my esteemed professors. If you have concerns with it perhaps you can share!
The main problem with the "theory" is that the change in the rate of growth in nominal gdp from a lower tax rate is not going to yield enough added tax receipts to come close to offsetting the drop in the marginal corporate income tax rate from 35 to 21. Nominal gdp is not going to change anywhere close to the rate of reduction in the tax rate. It is a simple math problem.
Corporate income tax receipts are down 33.8% from a year ago. As I stated earlier, any increase in tax receipts due to the tax will come from deferred taxes from 2003-2017 that should've been taxed at the same rate as other income, but received a special exemption from a law snuck into an omnibus 2003 economic recovery bill. You have to back those out from the current tax receipts or add to 2017 the relevant tax liabilities to draw an accurate comparison which will likely look worse than the 33.8% figure.
Reality, it seems it's always on the left side of the curve: lower tax, lower revenue; higher tax, higher revenue. When tax rate gets really high, very few would file tax return but everyone keep on working to stay alive. It never gets to the point that no economic activities fearing being robbed 100% by the IRS.
Professor Laffer was naive and wrong. There is straight line curve for the Rich, and there is a tiny slope curve for the Poor. The Rich: pay taxes no matter what. The Poor: only pay up to 4%, then tax revenue on them became zero.
Last edited by 6oo9; 08-28-2018 at 04:14 PM..
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