Saturday, April 11, 2015

Art Laffer As A Symtom Of GOP Madness

Art Laffer was adopted by the GOP in the 1980's.  The Laffer curve showed that high tax rates actually reduced tax revenues because they also reduced economic activity.  Ronald Reagan used that argument to justify a dramatic cut in the top tax rate after he defeated George H. Bush in the GOP primary.  Bush famously referred to Reagan's tax policy as "voodoo economics" but he lost the election.  The GOP has been running with that idea ever since.  If it takes voodoo economics to win elections, and reward your major constituents, they are all for it.

Art Laffer was wrong about the relationship between the top tax rate and economic growth, and all of his economic predictions about economic policy decisions during our recovery from the Great Recession have been wrong.  However, he has never been more popular within the GOP than he is today.  Paul Krugman argues that the GOP attachment to false economic ideas is a symptom of madness in a political party that lost its connection to reality.  It used to be a real political party with a better connection to the real world.

No comments:

Post a Comment