My take is precisely the opposite, the partisans don't want to look at the models/economics because it might contradict their preferred policies.

Could a tax cut be self funding? Sure, look at the capital gains tax.

In 2001, the leftist CBPP argued against the cut in the capital gains tax from 20% to 15%. They argued that any short term tax gain would be balanced by long term tax loss. So at a minimum, they acknowledged there could be a self funding aspect (even if only short term). What actually happened was the tax collection rose from $49B in 2002 before the capital tax rate cut to $51B in 2003 when the cut first took effect to $71B in 2004 to $80B in 2005. So a 25% reduction in the rate has increased the amount collected by 45%, presumably much more than the economy has grown.

The same 5% reduction to a higher or lower rate may impact how much income is collected. The 5% equaling 25% of the total tax rate made enough of a major shift in people's thinking to spur changes in behavior to collect more taxes. To see if income tax could have the same sort of impact, we would need to see about a 9% reduction in the top rate.

Thoretically and based on the capital gains, we can see that a change in tax rate can change behavior such that the total brought in is more than the prior rate. I think similar evidence could be shown that the income tax rates, which were more modest in both the absolute tax cut and especially as a percentage of the tax rate, have not done this so far. If you add in the questions of how soon a recession would have ended and how robust the recovery would be with out the stimulus of lower taxes (or from the left if they provide any stimulus what so ever), you can understand why this is a difficult issue to model. But catagorical statements that a tax cut can't be seen to pay for itself also don't seem to bear up under the facts.

Reagans quipped about economists s being people who would look at something happening in the real world and wonder if it would work in theory. I think that no one has a good model on tax cuts (including size, where directed, etc) vs tax revenue that can come even close to predicting reality. So we see partisan attempts on both sides to get the outcome we want to see based on the theory or facts, which ever are more convenient.

What caused the economy to expand, and to expand as much as it has so far? The tax cuts.

I agree that the tax cuts were probably a positive factor, but the cyclic nature of the economy does not hinge solely on taxes. Every economist understands this, even guys like Arthur Laffer and Milton Friedman.

What caused the economy to expand, and to expand as much as it has so far? The tax cuts. If you don't understand that, go back to the 9th grade.

You liberals believe that the growth would have been there regardless and that by giving people back THEIR money that there is then less money for govt to work with. WRONG!

I love the implication here.

But for the tax cuts we'd be in our 5th year of a recession. The worst recession since the Great Depression in fact.

Its been proven over and over and over and over again. How many times does it take?

What has been proven over and over again? That tax revenues go up when the economy expands and down when they contract? I agree. That the save for the tax cuts revenues would still be going down...I don't think so. This doesn't even pass the giggle test.

does anyone think tax cuts are justified by the fact that our government simply costs too much??

Well not quite costs too much, more like I just don't think it should be doing much of what it is doing.

does anyone who pays his own way think the government we have is a bargain, provided by competent leaders??

No.

You're wrong. Getting worked up over "supply side" economics, which is not an actual school of economic thought, is a little embarrassing.

Consider this: Mankiw's results (I'm relying on his blog and Steve's data points) indicate that the tax cuts do not pay for themselves. Tax cuts on wages pay for something like 17% of the lost revenue while tax cuts on capital pay for about half of the lost revenue.

As with most people, they ignore the fact that the Laffer curve, which is a fine tool for studying this, has a left side. If the criteria for judging our position on it is the ability of tax cuts to pay for themselves, we are on the left side, where increases in tax rates raise revenue.

Now, as Steve said, there are other arguments for tax cuts, including stimulus and starve the beast qualities that might reduce the size of government. Tax cuts paying for themselves ain't one of them in our country.

Sell it in Europe; it would likely apply better there.

wow what a liberal u r!

I did read the studies, but you know what else I study? Facts.

Look, I know it's hard for you libs to understand FACTS. Like increased tax receipts that would NOT have been there if not for the economy that was stimulated by tax cuts. You liberals believe that the growth would have been there regardless and that by giving people back THEIR money that there is then less money for govt to work with. WRONG!

Its been proven over and over and over and over again. How many times does it take? Yes I will acknowledge that R's in congress need to reign in spending. But the fact is that without the tax cuts LESS revenue would have been brought in. Can't you liberals understand that?

C'MON! THINK!!!!

The first paper is by N. Gregory Mankiw and Matthew Weinzierl (both at Harvard, and Mankiw was Bushâ??s former head of the Council of Economic Advisors).

Indeed. So wouldn't Mankiw have a vested interest in "beautifying" the tax cuts he had to defend (and try to extend) while in that position? The assumption you mention later, that the gov't's budget is always balanced, would seem to make their entire set of conclusions laughable...