Quote:
Originally posted by taxwonk
I would suggest that proves my point. If a theory is only valid at the extremes, then it is not a valid theory.
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Except the CBO study shows it is valid in the middle as well. What CBO showed was that we are on the uphill portion of the curve such that reducing taxes reduces revenue.
Sure, you can say the curve is lumpy or has multiple maxima, but there's even less support for that. Is it parabolic? No. Does it have a single maximum? Perhaps.
Club--your problem is that you think that t* (the rate obtaining maximum tax revenue) is somewhere below current rates.
Wonk--your problem is that you're trying to trash a very simplisitic theory that never purported to prove much of anything beyond a general principle on the ground that it is simplistic and fails to prove anything beyond a general principle. It's like saying supply and demand curves are an invalid theory because supply and demand have more determinants than price alone.
