Dan Mitchell writes A Laffer Curve Tutorial which features three great, short videos. Enjoy!
By Larry Kudlow
The new Tea Party GOP must maintain a message of economic growth.
Alan Reynolds is in today’s Investor’s Business Daily:
Personally, I’d prefer individual tax rates of 15%, 20%, 25% and 30% with a low flat rate on dividends, capital gains and estates and a 25% rate on corporate profits. But even such a modest move in the right direction would be ruled out if current law could somehow be made permanent.
By partially co-opting the banal Republican talking point about “making the Bush tax cuts permanent” Obama is really trying to cram through his own tax policy proposals from the moribund 2011 budget. He is belatedly pushing the same proposals from the same budget that Obama and a Democrat-controlled Congress have totally ignored since February.
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After the dividend tax rate came down, average dividends among the top 1% surged to $52,814 in 2004 and $83,072 by 2007. Reported dividends of the top 1% in 2007 were twice as large as the previous peak in 2000. That can’t be coincidence.
Since 15% of $83,072 is larger than 38.6% of $30,673, even that drastically reduced tax rate on dividends did not significantly reduce average revenues collected from the top 1.4 million taxpayers. But the lower dividend tax clearly did result in high-income taxpayers holding more dividend-paying stocks than ever before in taxable accounts.
Ralph Benko appears at the Washington Examiner today:
Economist Dr. Arthur Laffer’s famous curve provided an earlier era with the recipe for prosperity. It was a simple, irrefutable, axiom, showing that too high tax rates, by throttling economic activity, would stifle government revenue. (President Kennedy made the identical point.)
The Laffer Curve powered America out of the horrible stagflation of the 1970’s—an economy even worse than today’s.
We now enter a new political epoch. It demands a fresh axiom, Schramm’s Law: “The single most important contributor to a nation’s economic growth is the number of startups that grow to a billion dollars in revenue within 20 years.”
We seek to emerge from the Great Recession while the incumbent administration flounders about with ineffectual and counterproductive remedies. President Obama squandered so much political capital that the voters gave his entire party a “shellacking” (his word).Voters gave the Republicans a new and massive majority in the House — the constitutional source of taxing and spending.
Wall Street Journal interview with Robert Mundell.
‘The most important initiative you could take to improve the world economy would be to stabilize the dollar-euro rate.’
Really important op-ed in today’s Wall Street Journal by Arthur Brooks of AEI and Congressman Paul Ryan:
In polls, Americans overwhelmingly prefer small government and low taxes to the alternative. Yet they’ve been given big government, one program at a time.
By Larry Kudlow
Profits up, rates down, tax cuts, and a stock rally. How about some optimism.
In fact, since 2001, business profits have doubled, even while the stock market dial has hardly moved. If Washington can just keep its paws off of business and let market processes work, firms will continue to prosper domestically and internationally and will eventually pick up their hiring.
I hate to sound too much like Calvin Coolidge, who after Reagan is my favorite 20th century president, but the business of America is business.