Please disable your Ad Blocker to better interact with this website.

Image Image Image Image Image Image Image Image Image Image

Affluent Christian Investor | October 1, 2020

Select a Page:
Select a Page:
Scroll to top

Top

Email Featured
No Comments

Laffer Curve for Dummies

(Photo by 401kcalculator.org) (CC BY) (Resized/Cropped)

(Photo by 401kcalculator.org) (CC BY) (Resized/Cropped)

The now famous Laffer Curve, named after its originator, economist Arthur Laffer, shows that beyond a certain easily reached point, lower taxes yield higher government revenue. In other words, lower taxes are a win-win situation: Individuals and businesses win because they get to keep and spend more of their own money, and government wins because it takes in greater revenues than it would if higher tax rates continue to prevail.

The government gets more money at the lower tax rate because that lower rate encourages investment, business start-ups, and job creation: More investment means more businesses; more businesses mean more jobs; more jobs mean more tax payers; and more tax payers mean more government revenue.

Ever since the late Paul Simon, Democrat from Illinois dubbed this plan “trickle-down economics” in the 1970s, that name has stuck and has become a term of derision. What the Democrat deriders do not remember is that this plan is older than the 1970s. This plan was tried in the early 60s under President Kennedy. His tax cuts more than paid for themselves in less than one year. Although government officials predicted that Kennedy’s tax cuts would yield a nearly $90 billion dollar revenue shortfall, they actually expanded government coffers by more than $50 billion.

Rather than a trickle, this tax cut proved to be a cascade, one Kennedy described as a rising tide that raises all boats. No Democrat, then or now, accused Kennedy of favoring the rich. They do that only when a Republican offers Kennedy’s plan.

Which raises the question: Have you noticed the ever-widening gap between current Democrats and JFK, their supposed darling? He was a tax cutter; he was pro-business; he was a militant anti-Communist; and he was fervidly in favor of a strong national defense. JFK is far more like the GOP than he is like the Obama Democrats. Despite the Democrats’ professed admiration for JFK, they run madly away from his ideas. They have done the same with MLK.

 

Join the conversation!

We have no tolerance for comments containing violence, racism, vulgarity, profanity, all caps, or discourteous behavior. Thank you for partnering with us to maintain a courteous and useful public environment where we can engage in reasonable discourse.

Trending Now on Affluent Christian Investor

What We’re Looking At Today

  • Full video: Jordan Peterson on the Channel 4 Controversy and Philosophy of "How to be in the World"
    January 28th, 2018
  • Be Grateful for the Intelligent Design of Your Eyes
    December 23rd, 2017
  • TAX REFORM: The Most Important Things You Need to Know
    December 22nd, 2017
  • What Is 6th Gear? » Intermittent Fasting And Keto
    December 18th, 2017
  • DiscoveryInstitute
    December 7th, 2017
  • The King’s Choice – SAMUEL GOLDWYN FILMS
    October 12th, 2017

    • Follow Us

    Facebooktwittergoogle_plusrss

    Like us on Facebook

    Affluent Investor

    The Affluent Mix

    Become An Insider!

    Sign up for Affluent Investor's free email newsletter and receive a free copy of our report, "The Christian’s Handbook For Transforming Corporate America."

    Send this to a friend