Laffer curve - the real laugh

[tw]

Originally posted by bepatient
...
First, how do you determine that a tax cut is a bad thing? Historically, tax cuts on this scale have actually increased revenue to the federal government. Its a phenomenon know as the Laffer curve. It worked for Kennedy, Reagan and will probably work the same for Bush. You AND the Fed get more money. Win Win.

Also, maybe you're too young to remember the 70's, but I'm not. We are definitely 25 years into an energy crisis...largely un-noticed until last year when OPEC decided to hold us hostage again. ...

Had this been posted by the youngsters, then I could understand how spin doctors lies are believed. But you were there. Why do you believe their lying - by half truths? Why do you believe outright lies about Win win.

Tax cuts are narcotics. They create a quick boom followed by a recession. GNP numbers do no reflex economic growth That is exactly what happened with the Kenndey Tax cut. Do you forget the recession of four years later.

Look. I run a factory. I then hire some security guards. Therefore I have increased the nation's GNP numbers. However did I create economic growth? Of course not. That is what tax cut numbers do. They make higher GNP without any economic growth. You are old enough to understand these money games.

I develop a new medical procedure that gets the patient out of the hospital in 2 days instead of 6. Have I increased the nation's GNP? No. But I have increased the countries economic productivity. Again you are old enough that these number games are well known to you. Therefore you should have the knowledge to see right through the Laffer curve.

The Laffer curve is promoted to youngsters who do not understand those above economic money games. You saw too many government created recessions - so many that you should have been advocating the lynching of those spin doctors - to save democracy.

We know - at least we who would burn all spin doctors at the stake - that money invested today takes at least 4 years to create a profit. Obviously because innovative products require 4 to 10 years to reap economic rewards. Only neo-classical economists don't understand these basic economic principals. Since the tax cut did not result in a productivity increase - just a hard drug high - then an economy recessioned four years later. Welcome to the full story of the Kennedy tax cut - the part they forget to remind you about because they would lie only in their own interests.

There is no such economic reality as Win Win. Win win is the fiction of spin doctors. By now you have been around long enough to appreciate why Greenspan is so effective. Government cannot create economic boom - it can only create recessions. Government can make the ground fertile for a boom - but cannot create a boom. Only those of low intelligence would say otherwise. Those previous tax cuts resulted in following recessions. Greenspan simply adjusted liquidity to market needs. He does not create booms and withdraws liquidity when liquidity, rather than innovation, is creating too much economic activity. Greenspan is the only part of government that should be adjusting for the economy. No president has ever created economic growth - not one.

Anyone who knew the 60s and 70s understands that recessions are created by a shortage of innovative products. No tax cut nonsense has ever created innovation. However throwing too much money at innovation has actually destroyed innovation. Again you are now old enough to have seen that.

Money does not make economic growth. We know from too many historical examples that too much money or not enough money creates recessions. However those who still worship the high priest of political parties then still think government can create economic growth. At our age, having seen all those ups and downs, I am embarrassed to think that another who was also there STILL does not understand the lies by half truths. They are politicans masking as economists. You know they are lying - their lips are moving.

The Laffer curve can only be believed by those who read too much fiction in the 60s, 70s, and 80s. Clinton had it correct. Don't try to create innovations through money games. Don't try to create growth. Don't mortgage the government. Let the people who come from where the work gets done do the innovation - create the growth. Only then does America grow.

Ironically you have simply advocated the American version of communism - that government can create growth. This absolutely embarrasses me that another who live through all those bad times still does not see. The Laffer curve is being sold to those who didn't yet exist and who are easily lied to by half truths. You should be too old to buy into such silly lies such as the Laffer curve.

George Jr's tax cut is a bad thing - just as history has repeatedly demonstrated. Name a tax cut that did not result in recession.