No one could believe, as a general matter, that lowering tax rates brings higher revenues. For example, did George Bush believe this during Campaign 2000? Obviously, no—he did not. During that campaign, Bush proposed lowering the marginal tax rate from 39.6 percent down to 33 percent. But if lowering the tax rate brings higher revenues, why would Bush have drawn the line there? Why not lower the tax rate to thirty-two percent? No, to thirty-one! No, to 30! Obviously, no politician seriously thinks that lowering the tax rate brings higher revenues. But the claim has lived as a staple of talk-show discourse over the course of the past several decades.
It's so staggeringly simple. If lowering tax rates actually increased government revenues, no one in the world would be against it. If we can only lower the tax rate enough, we'd have more than enough money to cover the deficit, pay for the Iraq war, universal health coverage, you name it.
Rrrrrright!
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