Posted on 09/24/2007 5:59:10 AM PDT by John Galt 72
I wish to confess. I’m not an economist. In fact, I have never had a formal course in economics. I am also not a mechanical engineer. My understanding of economics is based on common sense, which tells me that you cannot get more work out of a machine than the energy you put into it. (I believe that this is one of the postulates of thermodynamics.)
Supply siders say that reducing marginal tax rates will induce the average Joe to work harder, smarter and more efficiently resulting in a huge increase in economic activity which will produce more tax revenue than was lost through the tax decrease. Well, it didn’t happen during Reagan’s first term (you may recall that he said that the budget would be in balance by 1983) and it hasn’t happened during the reign of George W. Bush. Instead, our direct Treasury debt is approaching 10 trillion dollars.
Since the only true test of the validity of an economic theory is its real world results, supply side comes up short.
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