Tax cuts have generally proven to be a big bust during the past few decades.
Former President George W. Bush pushed through a series of substantial tax cuts in 2001 and 2003, but growth failed to return to 1990s levels. More recently, experiments with lowering taxes at the state level have showed very disappointing results. The most glaring example is Kansas Governor Sam Brownback’s tax-cutting
program, begun in 2012. In the years since Brownback slashed taxes, the state’s finances have been drowning in red ink. But economic growth didn’t pick up, and Kansas has lagged behind its neighbor Nebraska in both labor supply and income per person...
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P)olicy makers shouldn’t listen to the supply-side orthodoxy. Deregulation could have some positive effects if done right, but tax cuts and austerity -- even if they could both be accomplished at the same time -- are policies with very little promise. To boost growth, the U.S. should look to other policies, like better infrastructure, stronger antitrust enforcement and more investment in research and technology.
Matt Bruenig
examines what sets the Nordic countries apart from the rest of the world - including high unionization levels and substantial public ownership of industry along with their well-funded social programs. And their success with that formula stands in stark contrast to Noah Smith's
observations about supply-side economics:
click on the coloured links above to read the articles
