Today’s Brew 10-1-14

Dan Mitchell writes on his blog:

The Rahn Curve, the Laffer Curve, and Walter Williams

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From the UK, good news for supply-siders:

Five reasons why the Tories tax cut pledge is great news

At last, David Cameron is being much bolder on tax

Here are five reasons why today’s tax cuts should be embraced enthusiastically.

1. They show that the Tories are re-embracing supply-side economics and the lessons they had originally learnt in the 1970s and 1980s but then appeared to forget

These tax cuts will boost people’s incentives to work and save; by allowing folk to keep more of their own money, they create a closer connection between effort and reward, something which is at once ethically sensible and economically efficient. George Osborne had previously shown that he believed this with corporation tax – he has slashed rates to improve investment and competitiveness – but had sent mixed messages on other taxes, wrongly hiking capital gains tax, for example. Today’s announcement confirms that the Tories are once again a pro-market party. Sure, the actual extent of the cuts is not huge, and they will take years to kick in. But they will nevertheless be worth an estimated £7.2bn a year by 2020. This is an important and welcome day in British politics. Supply-side economics are back, not a minute too late.

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