Please, I fully understand the Laffer curve, it is conservatives like you who don't.

I see you've got precisely nothing when it comes to cutting taxes and tax revenues. In fact, Greg Mankiw notes that income taxes only pay for about 17% of the lost revenues.

From the link,

According to the researchers, the neoclassical growth model and all of its variants indicate that the dynamic response of the economy to tax changes is substantial. In almost all instances, they find, tax cuts are at least partly self-financing. The authors conduct some simple calculations, plugging in numbers that approximately describe the U.S. economy. They find that, in the long run, about 17 percent of a cut in labor taxes is recouped through higher economic growth.

When it comes to capital gains taxes, the results are more in favor of tax cuts in that 50% of the cut is recouped.

Your examples make no attempt to disentangle things like the normal rise and fall of tax revenues due to the business cycle. You credit it all to tax cuts which is very misleading.

Thanks, I never new that about the Laffer curve.[/sarcasm]

Well, you keep ignoring it, and can only seem to come up with weak and/or silly counterarguments ("1%," for example).

As far as tax cuts resulting in more income, there's the Reagan years and the current Bush years. I doubt we could find a good third example in national politics, since it's been tried so seldom. In state politics, Florida had some huge tax cuts over the last few years, and revenue is booming, to say the least, along with a very good overall economy.

And yes, the increases in income were more than offset by spending. This is what's known as "another question entirely."

When I mentioned tax hikes, I wasn't advocating them, but seeing them as an inevitable result of the current spending path we are on. I hope this clears that up. I'd much rather restrain spending than raise taxes, but I fear that is never going to happen.

Ken, hyperventilating.

Ken, I don't deny that spending can act as a stimulus. Why you felt I held this position when there is nothing I've written to indicate such a position is your problem.

When the federal government cuts taxes it always has and always will result in a reduction in revenue unless it is offset by an even bigger deficit stimulas.

ROFL. Okay, is this some sort of inverse Laffer curve or something. Enough deficit spending and the economy will grow so fast that deficits will be eliminated? Maybe we can call it the Ken Kurve or something.

When the federal government borrows money to buy things and hire people the federal government also gets tax revenue right along with those products and employees.

When the federal government cuts taxes it always has and always will result in a reduction in revenue unless it is offset by an even bigger deficit stimulas.

Because we have never had a federal tax cut without an even largher offsetting massive increase in deficit spending you have mistakenly credited the tax cuts instead of the deficit spending for the increased revenue.

Look toward the end of your post where you said:-)

"Right now I�m rather pessimistic on the budget outlook for the future and we�ll likely see some tax increases in the not too distant future."

I realize your post was related to the impact of tax rates on tax revenue and you are not specifically making the argument that spending restraint is not important.

However, everybody needs to realize that until we get some restraint on spending, especially entitlement spending, raising taxes is only a transient solution. The politicians inevitably spend everything the additional taxes bring in plus a little more then we end up hearing about the need for more taxes to cover the deficit.

...

Thatâ??s an insane oversimplification of what the point really is, and not at all what people actually claim. This is a true straw man argument, and Iâ??m surprised to see it here.

Actually, I disagree strongly here. Sure it is an insane oversimplification, but the problem lies with those on the right who always argue that cutting taxes raises revenues. I've heard Sean Hannity make the claim, Larry Elder, and others as well. There is no tax cut that I have heard people say on the right say, "Well, yeah it will lead to deficits, but...."

Itâ??s not an either/or case of either 100% taxes or 1% taxes. The whole point of the (one more time) Laffer Curve is that thereâ??s a point where higher taxes actually create less government income, due to the economy being starved of the cash it needs to function well. Historically, taxes in the US (and, indeed, most â??modernâ?? countries) have been too high, as witnessed by the increase in government revenues when taxes have been cut.

Thanks, I never new that about the Laffer curve.[/sarcasm] As for the higher revenues, I'd like you to post at least three decent studies making that case.

TJIT,

I have a hard time following this logic. The congress has a spending problem therefore we must raise taxes so they have more money to spend.

Uhhhmmm, I'm having a hard time finding that in my post.

Ken,

Tax cuts have never led to higher revenue. Deficit spending is what stimulates the economy, not tax cuts.

Thanks for demonstrating the silly economics is also a problem for the Left. Sure tax cuts provide stimulus.

Cirby, take a look at this set of slides from the well known "liberal" Heritage Foundation:

http://www.heritage.org/research/features/BudgetChartBook/charts_C/c1.cfm

Then come back and explain to me how the Republicans and conservatives demonstrate better stewardship over the tax/spend issue.

Tax cuts have never led to higher revenue. Deficit spending is what stimulates the economy, not tax cuts.

Well, it's nice to know that you've managed to come up with a counter for the last half-century of modern economics. Which would be what, exactly? A blind faith that the current level of taxation is divinely inspired, and neither too high or too low?

Could we please realize deficits are a simple math problem

tax revenue - spending amount = deficit.

Let's acknowledge that fixing the revenue side of the equation without addressing the spending side guarantees that deficits will continue to be a problem.

This whole discussion with conservatives about taxes and revenue is impossible as they are just too stupid to deal with reality.

If the mantra is correct we�d better set taxes to 1% right now so that revenues will be high enough to cover these looming costs.

That's an insane oversimplification of what the point really is, and not at all what people actually claim. This is a true straw man argument, and I'm surprised to see it here.

It's not an either/or case of either 100% taxes or 1% taxes. The whole point of the (one more time) Laffer Curve is that there's a point where higher taxes actually create less government income, due to the economy being starved of the cash it needs to function well. Historically, taxes in the US (and, indeed, most "modern" countries) have been too high, as witnessed by the increase in government revenues when taxes have been cut.