[Your Nightmare]

LOL, your */~rdavis whoever he is, constructs a strawman, and does a lousy job of analysis.

rdavis is a fellow Freeper named Remember (AFAIK). You can take up his analysis with him. He seems to have done a good job to me.


"The increases in marginal tax rates imposed by the Clinton administration and Congress are likely to raise little or no additional revenue." Martin Feldstein - 1993

Well that prediction didn't turn out too well, now did it. Thank you for the beautiful example of how wrong economists can be when they try to predict the future. (Beside the fact he doesn't seem to understand what Laffer was saying with the Laffer Curve. He said raising the tax rate could raise or lower revenues depending on where you are on the curve.)

[ancient_geezer]

LOL, your */~rdavis whoever he is, constructs a strawman, and does a lousy job of analysis.

rdavis is a fellow Freeper named Remember (AFAIK). You can take up his analysis with him. He seems to have done a good job to me.

Good then he will be able to explain his methodology used to isolate the effects of changing marginal rates on avoidance behavior that causes the laffer curve to turn down as the maximum tax rates approach 100% and how tax avoidance behavior decreases as the marginal rates decrease providing higher revenues as marginal rates decline toward providing a nominal peak of revenue.

For the Laffer curve is a composite of two effects arising from limiting conditions on a taxed population, tax rates interacting with tax avoidence, limiting revenue extraction. The more you tax a thing the less it will be indulged in by those who are taxed.

High marginal tax rates hitting the most prolific earners increases their propensity to avoid the or shelter from the tax, set rates high enough taxpayers cease to produce or depart for a more tax friendly environments.

[remember]

"The increases in marginal tax rates imposed by the Clinton administration and Congress are likely to raise little or no additional revenue." Martin Feldstein - 1993

Well that prediction didn't turn out too well, now did it. Thank you for the beautiful example of how wrong economists can be when they try to predict the future. (Beside the fact he doesn't seem to understand what Laffer was saying with the Laffer Curve. He said raising the tax rate could raise or lower revenues depending on where you are on the curve.)

You're right, that prediction didn't turn out too well. It can be most quickly illustrated in the following graph:

Note the sharp rise in revenues from 1993 to 2000. Then compare that to the even steeper drop in revenues from 2000 to 2004. You can also see that, as a percent of GDP, revenues did drop during the eighties. The actual numbers can be seen at http://home.att.net/~rdavis2/def05.html.