Someone's behavour might not change from lowering their tax rate from 36 to 34% but they will have 2% more to spend or invest, and not give to the government to waste a good portion of it. It will be put to good use.
What will the person who receives the additional two percent of their income do with it? Burn it? Not likely. What they will do is spend it or "save" it.
Saving it typically means that somebody else gets cheaper use of the money than they otherwise would.
Both scenarios increase economic activity and will increase the taxable base.
The only reason that taxes don't depress the economy more than they do, is because the government spends the tax money. Government activity generates economic activity that is then taxed.
Now you can ask yourself the question, "What will happen when the government must increase taxes to satisfy our debts, without being able to generate economic activity with the money?"
The answer is that economic activity will surge in areas populated by debtors of the U.S., like China, and economic activity will stagnate in the U.S.
There is never long term economic benefit from unnecessary government spending nor is there long term economic benefit to deficits which increase the national debt.
Most government spending is simply waste. It is the nation's wealth squandered on liberal nonsense. The delayed payment through deficit spending will not permit that waste to go unrecognized forever. In fact, as the boomers retire, the waste of government spending during their lifetimes will become quite evident.
“To believe that anyone’s behavior is going to change as a result of lowering the tax rate from 36 to 34% beggars belief”
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Well, I think you and I are close to agreement that revenue will not always go up as you reduce taxes, depending on where we are on the Laffer Curve. To use the extreme, if the tax rate were zero, the tax revenue would be zero.
But I’ve never heard the GOP or conservative doctrine state that “”at every marginal point along the spectrum, every reduction in tax rates increases revenue.” I think the contention of the party is that currently tax rates are too high (on the Laffer Curve) such that reduction from where they are will result in higher revenue.
However, I do not subscribe to your contention that “To believe that anyone’s behavior is going to change as a result of lowering the tax rate from 36 to 34% beggars belief.” This is the same as saying that if a company lowers their price from $36 to $34 they won’t sell more product. It may not change the buying habits of 9 out of 10 people (or 99 out of 100) but it will cause an effect with some people.
In the case of taxes, however, it has a much more complex affect. What will the taxpayer do with the 2% of their income that they no longer have to pay in taxes? Let’s suppose they use the money to buy a hot tub. The company they bought the hot tub from will see increased revenue, which results in them having to pay more in taxes than they otherwise would have. They will have to pay their raw material suppliers more (who will end up paying more in taxes), will have to pay more for freight (causing the carrier to pay more in taxes) and on and on. The increased activity then passes on to the next level (the raw material supplier of the raw material supplier). If enough people use their tax savings to buy hot tubs, the hot tub manufacturer will have to hire more employees, or work them additional hours, which will also result in higher tax revenues.
A 2% reduction in taxes can, and has, caused significant changes to economic growth due to the compounding effect, and certainly can create a net increase in tax revenue.