Supply-side economics is the basis of all conservative economic thinking since Reagan,
False. It may be the thing that the politicians have most emphasized, but conservative economic thinking is based on a logical organic succession of thought beginning with the Austrian school of von Mises and Hayek, and modified by monetarists like Milton Friedman and put into practice most recently by Ben Bernanke.
Was there anything “supply side” about QE? No. About TARP? No.
As I said before, you’ve taken an apple off a tree, didn’t like the apple, and now you’ve decided to burn the tree.
Supply-side economics states that revenue is supposed to INCREASE by a)cutting taxes, b) cutting spending and c) cutting regulations. All three: not just one. The resulting economic boom is supposed to raise revenues overall, making up the shortfall in tax cutting. This was applied to Kansas.
Supply side economics, as championed by Laffer, is silent on cutting spending and regulations. As I stated before, it’s not a fully developed economic theory; it’s a POLITICAL theory designed to have mass appeal.
THAT SAID, it is impossible to determine what the overall effect of the Brownback package would have been on the Kansas economy had commodity prices not cratered. My view is that Kansas took three “punches” simultaneously: The first was the cut in revenues, the second was an abrupt change in how Kansas raises revenues (businesses develop strategies and plans around how they are taxed), and the third was the drop in commodity prices. Ergo, it is impossible to hypothesize over what “would have happened” because of the interrelation between the factors.
Every state around Kansas is farm dependent. As I posted originally, “the surrounding states, which did not impose massive tax cuts aimed at the rich, outpaced Kansas on all three measures over the same time period.” Nebraska is like Kansas, with fewer resources. Even Nebraska did better than Kansas.
Obviously. Because they only took one “punch”, when Kansas took all three.
When one is presented with a direct experiment, described as an “experiment” by its architects, where the economic hypothesis does not come close to results, one cannot just say, “Oh, well, it is just one example.”
Nobody said “oh, it is just one example”. What’s being said is “that’s one example, and here are the rational reasons why it’s a bad example.”
- Posts a rational academic study showing that red states are better for business startups, pointing out that the reason this is of high importance is that 70% of economic growth comes from the small business sector nationwide.
- Posts a rational professional study showing that red and blue states are approximately equal in overall business environment.
- Posts the credit ratings of all the states, showing that the red states tend to be better stewards of taxpayer money than most blue states are.