As regards my statement of the effect of tax cuts on economic growth which NY took exception to and used your analysis as being a refutation, and why I call that reference a "stawman" and lousy job of analysis. "The Reagan tax rate cuts being a prime example of not only of economic growth from marginal tax rate decreases, but a characteristic growth in government revenue collections that go with growing economies."
As you can see from the first sentence of my short and long analysis, their immediate focus is the claim that the near-doubling of revenues during Reagan's two terms proves the value of tax cuts. Do you at least concede that this claim is totally bogus? In any case, I assume that YN referenced my analysis because of the part of your statement above that I put in bold type. You now seem to be saying that you made no claim as to revenues but were talking only about economic growth. In any case, are you simply referring to YN's use of my analysis as a "strawman and lousy job of analysis" or are you referring to my analysis? If the former, then you can take it up with YN (and clarify that you have no complaint against my analysis). If it is the latter, then please post specifically what number or conclusion you disagree with.
I bring your attention to real per-worker gdp of 1986-2000, compared to real per-worker gdp 1960-1986.
Where did you get the exact years 1986-2000? Was there text accompanying that graph? If so, please post a link to the page. In any case, I can't see the great growth from 1986-2000 that you speak of. I see high growth from about 1946 to 1968, general stagnation from about 1968 to 1982, fair growth from about 1982 to 1991, and higher growth from 1991 to 2000. In fact, it appears that you got that graph from Bradford DeLong's website. I found an nearly identical graph in one of his papers at http://www.j-bradford-delong.net/macro_online/lec_notes/LN_ch1.pdf. About that graph, he writes:
Figure 1.4 shows this upward trend in real GDP per worker. Despite temporary setbacks in recessions and depressions--of which the Great Depression of the 1930s--was by far the largest--the principal event of the twentieth century was this quintupling of measured real GDP per worker. Other macroeconomic events visible in the figure include the World War II boom, the 1974-1975 and the 1980-1983 major recessions, the 1990-1991 minor recession, and the two-decade long period of stagnation from the early 1970s to the early 1990s--a period that saw the 1973 and 1979 sharp oil price increases by OPEC, and the large investment-reducing government budget deficits of the 1990s.
As the part I put in bold type shows, he states that the stagnation lasted from the early 1970s to the early 1990s. As I said, the eighties look to me like they had fair growth. In any case, neither of us see the unique spurt of growth that you seem to see during the eighties. That is the same result in the look at GDP that I did for my analysis. As you can see from the following graph, there appears to have been nothing terribly spectacular or unique about the growth in GDP during the eighties. I refer to this graph in the analysis at longer analysis at http://home.att.net/~rdavis2/taxcuts.html.
So, once again, if you have any disagreement with a specific number or conclusion in my analysis, please post it. If your disagreement is simply with the relevance of my analysis to your discussion with YN, then you can take that up with YN.
"their immediate focus is the claim that the near-doubling of revenues during Reagan's two terms proves the value of tax cuts. Do you at least concede that this claim is totally bogus? "
Since revenues have increased in a periods of rising taxes, "doubling" can't be due solely to tax cutting it was as much due to continued inflation during the '80s. In fact looking at the first Reagan tax measure "Roth-Kemp '82", cutting was not the main thing happening as many deductions were taken away simultaneously, countering the effect of rate cuts.
It is the '86 tax package that many economists look at as the substantive package, with the subsequent economic growth that was a consequence of both dropping the top marginal rate to 28% along with enhancements encouraging investment over consumption that initiated the economic growth of the '90s. That was the true impact of the Reagan administration.
The most that I see is that reducing tax rates alone while on the upper half of the "Laffer curve" would provide an enhancement over the revenue one would expect from static anlysis. One could expect from the resulting stimulus to economic growth to maintain revenues or even increase revenues if the impact on economic growth were sufficient.
The key factor, as I see the issue, is economic growth, in the '86 tax & stimulus package most of that was due to encouraging investment into the infra structure of the economy which allowed subsequent tax rate increases without immediately killing the goose. Hence the performance up until 2000, where tax system disincentives to investment introduced during Bush I & the Clinton administrations finally were too much for the economy to bear resulting in a slowing economy and return of revenue deficits.
You now seem to be saying that you made no claim as to revenues but were talking only about economic growth.
Economic growth is what allows revenues to remain stable or increase inspite of tax rate reductions or increases for that matter.
In any case, are you simply referring to YN's use of my analysis as a "strawman and lousy job of analysis" or are you referring to my analysis?
Mainly YN's missuse of your analysis which seems to be mainly focused on the Roth-Kemp '82 tax measure, which really didn't reduce tax burdens as much as play shell games between rates and deductions.
I bring your attention to real per-worker gdp of 1986-2000, compared to real per-worker gdp 1960-1986.
Where did you get the exact years 1986-2000?
They followed the 1960-1985 lack of GDP productivity growth in per unit labor terms.
I was aware of the issue from analysis of tax reform measures based on the lessons learned from the the 1986 Economic Recovery Tax Reform Act PL 99-514 and its effects.
The Economic Impact of Fundamental Tax Reform
http://www.economics.harvard.edu/faculty/jorgenson/papers/208.pdf,
Frontiers of Tax Reform, Stanford, Hoover Institution, 1996, pp. 181-196; reprinted in Joint Economic Committee, Congress of the United States, Roundtable Discussion on Tax Reform and Economic Growth, One Hundred Fourth Congress, First Session, 1996, pp 98-112.
So I looked for a graph using Google image search illustrating the gdp growth in labor productivity terms and found it in a university economics class website:
http://econ161.berkeley.edu/Graphics/GDP_growth.gif
