Wednesday, August 4, 2010

Arthur Laffer Call Your Office

Economist Arthur Laffer is the number one proponent of supply side economics and the theory that the economy grows as a result of tax cuts. Well, Treasury Secretary Tim Geithner wants to put and end to that kind of talk. During prepared remarks today at the Center For American Progress, he said:
 There are some politicians who argue that tax cuts pay for themselves. This is a long discredited idea. There is absolutely no evidence to support it..

And conservative economists and policy-makers – even those who once hoped that this fiction was fact – are embarrassed by the argument. They run away from it.
During the Q and A session, Geithner again referenced the Blinder and Zandi report which supports the Obama Administration's view that the Obama intervention saved millions of jobs. Geithner did not address the devastating critique by Stanford's John Taylorof the Blinder-Zandi paper.

I attended Geithner's speech and would have asked him about the Taylor critique, but for some 70 plus reporters in the room only three questions were taken. Then we were all dismissed and had to wait in adjoining rooms as Geithner's security detail commandeered the hallways and elevators for his escape.


  1. Sorry for potentially invoking Godwin's Law, but as Hitler said, if you lie big enough (and boldly enough) nobody would dare question you. Or perhaps he's talking out of his lower backside. Given his credentials, he gets a free pass for nearly everything he says by the populace. Again as Hitler said, "what luck for rulers that men do not think."
    Back to Laffer, although he blew the call on the housing boom almost as badly as Chris Dodd, this article of his was great.
    The graph is very telling, too. Tax cuts helped the lower income earners more than the high income earners and tax income receipts may in some cases fall as a % of GDP but rise overall (if a tax cut boosts GDP by 10% and boosts tax revenue by 1%, of course the left will charge that it cut tax revenue as a share of GDP, but when but are boosted, that metric is moot)

  2. Good ol' Tim. First off he's a tax cheat himself, so what does he care. Secondly, he is a defender of his government pension, which is dependendt on government having enough money to pay him and the other 2.15million government class workers. He, like his boss, have no clue what its like to go to work for the "man" and even less about what its like to start and build a business. Those things are all mystical to him and most of the President's cabinet. I never thought it was possible for America to elect an even more ignorant/arrogant President the Bush 2, but once again American has sunk to the occasion. The politics of jealousy and envy always appeal to the masses, especially in times of economic turmoil.

  3. Geithner is a disaster, much like the administration that appointed him. I can only pray (and dream) that 2012 will see the end of these banksters once and for all.