The Bush tax plan would probably not have these dramatic effects on increased tax collections. The supply side effects of cutting income tax rates when they are in the 70 to 90 percent range is much more pronounced than when they are in the 40 percent range, as they are today. But the case for lowering tax rates today is that we now live in an era of instantly mobile global capital markets. This capital infusion translates directly into more jobs and higher productivity for US workers and not just for the richest 1 percent. Al Gore may not understand this modern economic reality, but the leaders of other nations do.
History proves that tax cuts are an effective antidote to economic slowdowns.
The opponents of tax cuts are simply waging a war of greed and envy. That's no way to run US economic policy. Arthur Laffer is president of A.B. Laffer Associates. You can contact us at the above email address for any comments or information requests. Please report any dead links or technical problems.