and if it's "too cold," likewise, cutting taxes will warm it up. Taxes aren't about getting money to spend, they are about regulating our spending power to make sure we don't have too much and cause inflation, or too little which causes unemployment and recessions. "In conformity with economic theory, the spending effect was larger when the tax change was legislated to have a permanent effect on tax liabilities." The effect of tax changes on consumer spending, Steindel, Charles, Current Issues in Economics and Finance, December 1 2001 http://www.allbusiness.com/marketing/mar\\... William A. Niskanen, the chairman of the libertarian Cato Institute says: "judging by the last twenty-five years (plenty of time for a fair test), a tax cut of 1 percent of the GDP increases the rate of [government] spending growth by about 0.15 percent of the GDP a year. A comparable tax hike reduces [government] spending growth by the same amount...Again looking at 1981 to 2005, Niskanen then asked at what level taxes neither increase nor decrease spending. The answer: about 19 percent of the GDP. In other words, taxation above that level shrinks government, and taxation below it makes government grow." ( http://www.theatlantic.com/magazine/arch\\... ) What would be the effect of setting government spending at 19% of GDP (Niskanen's number) and eliminating tax collection entirely? Niskanen is total crap. I expect the moron cato institute to connect a bunch of dots on a chart and declare "a tax cut of 1% of GDP increase the rate of Govt spending by about