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To: Kaslin

The important point to note about the Laffer Curve is that Conservatives must not fall for the trap it lays for them. We are tempted to want to tweak the tax rate so as to optimize government revenues.

Government exists not to be able to extract the maximum amount of money from its citizens but to achieve the maximum amount of liberty for them. This is the Liberty Curve, where zero government has no liberty due to anarchy and complete government intrusion has no liberty due to tyranny and coercion.

We must strive to use government for its intended purpose, to secure the blessings of liberty for all citizens.

Look up “Rahn Curve”


8 posted on 09/21/2014 2:22:35 PM PDT by theBuckwheat
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To: theBuckwheat

“Rahn Curve” Video Shows Government Is Far Too Big

By DANIEL J. MITCHELL

There is considerable academic research on the growth-maximizing level of government spending. Based on a good bit of research, I’m fairly confident that Cato’s Richard Rahn was the first to popularize this concept, so we are going to make him famous (sort of like Art Laffer) in this new video explaining that there is a spending version of the Laffer Curve and that it shows how government is far too large and that this means less prosperity.

http://www.cato.org/blog/rahn-curve-video-shows-government-far-too-big

Also:

New Study from Swedish Economists Allows Us to Quantify the Cost of the Bush-Obama Spending Binge
By DANIEL J. MITCHELL

...
For all intents and purposes, all this research shows that developed nations are on the downward-sloping portion of the Rahn Curve. Named after my Cato colleague Richard Rahn and explained in the video below, the Rahn Curve is sort of a spending version of the Laffer Curve.

It shows that growth is maximized by small governments that focus on core “public goods” like rule of law and protection of property rights. But when governments expand beyond a certain growth-maximizing level (the research says about 20 percent of GDP, by I explain in the video why the right number is probably much smaller), the result is slower growth and less prosperity...

http://www.cato.org/blog/new-study-swedish-economists-allows-us-quantify-cost-bush-obama-spending-binge


9 posted on 09/21/2014 2:23:59 PM PDT by theBuckwheat
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