This crap is really complex, which is why even the math and policy geniuses at the CBO are so often off.
Occam's razor.
I think you are trying way too hard to make a bunch of complicated theories work to support a desired condition - low taxes and less regulation.
Hm. Well, full-disclosure, my own preferred tax scheme (which I've worked on somewhat elsewhere) involves raising payroll taxes on high income earners (as part of reforming Social Security), but transforming income taxes into a rate of 25% of all income earned over 200% of the Federal Poverty Line for the Household (or individual) filing. In that manner, the
effective rate would be perfectly progressive, as each additional dollar earned over that 200% of FPL would slightly increase the effective tax rate of the person paying. I paired this with a Negative Income Tax of 50% of all monies
not earned
below 200% of FPL, which I argued, should replace the current, damaging, transfer payments structure in this country.
However, to simply say "
Pshaw! This stuff isn't complicated!" is.... well, it appeals to populists because populists like Clearly Defined Bad Guys and Promises Of Easy Answers.... but it's not a good policy answer, because - yeah - this stuff
is complicated,
and the problem is complex. A lot more goes into determining tax revenue than tax rates, and tax rates in our current environment don't even appear to be the main driver.
Here is one fact that is very annoying - why all the economic stimulus manipulations during a time of a booming economy?
Because politicians only care about getting reelected, and the electorate is stupid enough to care only about the short term.
Tax cuts (strongly favoring them folks with money) and low interest rates being the most obvious? Why aren't they working to reduce the deficit?
Because that would require that politicians make responsible decisions
even if it costs them political support, and we out here in the voting public are swift to punish any politician foolish enough to do a thing like
that.
Isn't it natural to pay off debts when you are flush with cash?
It is the
wise decision. I'm not sure it's the
natural one.
It is a fact that the artificial stimuli did not add anything to the booming economy, but not taking revenue DID NOT do anything to boost revenues. I think jgw may have pegged that one - tariffs. Tariffs have brought in approximately as much revenue as the tax cuts threw away, but they have only harmed businesses (mine is one of them - thousands of dollars thrown away, for no benefit).
As the wag once said: Trade wars are wars politicians wage against their own people.
Then there is this little piece of evidence about high taxes and the economy - note the general correlation between high rates and prosperous times (and low national debt).
![[Linked Image from bradfordtaxinstitute.com]](https://bradfordtaxinstitute.com/LibRepository/c8b3faa8-f597-4209-8a37-786c900cdf09.JPG)
We are currently in the most prosperous time in the history of the Human
Species... so....
We have morphed into a debt-based economy - that is the problem.
I wholeheartedly agree with this, and, in fact, spend my free time teaching adults how to get out of consumer/college debt, and students how to never get into it in the first place.
And you can't just blame spending.
As I said above, it's far and away the primary driver of the deficit. That doesn't make it the only factor at play, I agree - simply far and away the biggest, and the one that most needs solving.
Some spending is a good investment with a long term positive ROI...
Wise infrastructure investments and an effective judicial system for enforcing law and contracts are the most common expressions of this.
some spending is really pointless and destructive. I don't see our spenders taking that into account, mostly because the spending is controlled by them that has most of the money, and they are shortsighted and greedy.
...Eh, our public spending is controlled by our politicians, who can be influenced by others - including wealthy interests - but whose primary purpose is reelection. If every billionaire in this country told the Democratic Party they needed to get on board with privatizing Social Security, they would still be ignored, because the Democratic Party isn't about to commit deliberate political suicide.
