CATO, Examining The Evidence   Leave a comment

Research paper published at CATO refutes the “Starve the Beast” philosophy of reducing government spending by cutting revenue.

The empirical evidence shows that cutting taxes *increases* spending.  Why?  Possible reasons

In the first place, cutting taxes doesn’t deprive the government of funds as long as it can tap the credit markets on a vast scale. Locking up the ice cream does no good if there’s an endless supply of burgers and fries. In the second place, cutting taxes instead of spending is seductively pleasant. It lets citizens enjoy more government services at no extra cost on April 15.

We can have our cake and eat it too!  Tip o’ the blogging hat to The Volokh Conspiracy.

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Posted May 3, 2010 by padraic2112 in politics

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