Monday, February 4, 2008

The Laffer Curve Video

I found this at Don Boudreaux's "Cafe Hayek" site. Here's a video that explains why it's sometimes a good idea to cut taxes when rates reach the 70% level. It can be a good idea to cut taxes when the rates are at 40%, or even lower. It depends on which level makes people either a) stop working to make more money, or b) start hiding their revenue.

The video explains how a tax cut can increase revenue.

It's also proof that I'm a total geek, just because I posted it.
If everyone who votes tomorrow on Super Tuesday understood this, we'd get radically different results.
Think of it often next time you're watching a debate, and someone accuses her opponent of "cutting taxes for the rich".
Like that's a bad thing....

I'm also plowing through Boudreaux's new book "Globalization". It's only about 150 pages, and costs $55 freakin' dollars, but is probably worth it.

Boudreaux is an avid writer of Letters to The Editor. All sorts of editors. Any editor who has dared to flash Economic Innumeracy in public. An astounding number of his irrefutable rants get published. Imagine if the cranky old guy who always writes in to your hometown paper was not only correct, but also brilliant.

At thirty cents per page, he has to be good.

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