This is true.

This is not true at all. It's a simplified conceptual framework for understanding the relationship between tax rates and revenue. The Laffer curve does not argue that reducing tax rates necessarily increases revenue, you must separate that from how it has been applied in very specific policy debates.

What people generally understand is that American tax rates (as a % of GDP) are low in context, and so it's unlikely that reducing tax rates will lead to a net increase in revenue.



The CBO has done these sort of projections when looking at the impact of tax cuts on the deficit. They generally find that lower tax rates spurs growth, which generates tax revenue, but not nearly at the clip required to offset the reduction in rates.

This is what happens when you hire women

LOOOOOOL.......

Who would have thought ThorT would dimiss such a simple concept to explain a simple concept, only to try to replace it with something more "complex"

Most economists would be grouped into two camps. One which says "okay, it might be true, but there's virtually no way to know where the maximum is, and we don't know how steep the curve is on each side, and so it's basically useless, and it's not always going be shaped like a Laffer curve for every economy", or "the response to tax rate changes is complex and we have no reason to assume the curve would be shaped this way".

Pseudoscience is a bit too strong probably, but you get the idea. The Laffer Curve is not a very useful idea and has very little if any empirical support, and so it doesn't occupy a lot of space outside of far right circles anymore.

Anyway I'm far from an expert. This is my laymen interpretation from when I've scanned the literature. We need a Ph.D. economist on this forum lol

This post was edited by Thor123422 on Feb 13 2021 10:23am

people here have such short memories. the laffer curve was the right's 'argument' to justify the massive taxbreaks for millionaires and corporations under trump, claiming they would lead to increased revenue (through investment and job creation) and a lower deficit.
mentally sane and economically literate people argued back then that it would NOT play out that way, just like the 37 times republicans promised the same thing to justify taxcuts for their friends and families before - that it would lead to decreased tax revenue and a ballooning of the deficit. and that's exactly what happened.

so can we please stop pretending like 'the laffer curve suggests our taxes are too high' was a legitimate argument based on science or evidence? because it clearly isn't - it's just a right wing talking point to keep robbing america while making dumb people believe it's good policy...

if you replace 'hate' with 'think critically about' you're not only much closer to the truth, but it also explains why the right isn't able to do it.

The problem is they have a free pass to go full retard and people encourage it on. Haven’t seen many activists happy and spreading peace and unity, just a bunch of misguided youth finding problems where there aren’t any