Believe me, I’m no economist. I have enough trouble with accounting classes.
I’m reading the New York Times article entitled “Arthur Laffer’s Theory on Tax Cuts Comes to Life Once More” and the focus is on the Laffer Curve. Laffer states that it is possible to increase tax revenue by cutting taxes. In theory this sounds great – as the article states, “…an ambitious tax cut would unleash businesses that now feel constrained by one of the highest corporate tax rates in the world. Corporations would be freed to build plants and create jobs in the United States instead of in foreign countries, and would bring home money that currently is sheltered overseas.”
But this is where we run into one of the main issues with Republican policies – the idea that if you give people more freedom, they’ll do what they should do. If you remove some of the tax burden on businesses, they should build plants, create domestic jobs, and shelter less of their profits overseas. Operative word: should.
Since when, however, did people do what they should? I’m not saying that every business leader is corrupt or greedy. But even if some of them are, doesn’t that mean that the Laffer Curve may not produce the revenue that it should?
There’s a big difference between will and should, and I find that a lot of Republican policies discuss the possible effects of legislation in terms that cause the public to believe the outcome is certain, and that’s a problem for all of us.