The graph makes a point that would be controversial if people were aware of it, namely that in general, the more an administration reduced tax collections during its first two years in office, the slower the growth rate during its remaining years in office. This result contradicts the beliefs of most people who have taken an economics course in this country, and anyone who listens to Rush Limbaugh or watches Fox News. But the fit is surprisingly tight considering how few variables are involved. It doesn't matter who believes it, or whether we are happy with this result. I personally would much prefer to see lower taxes leading to faster economic growth than slower economic growth, but reality is what it is, not what we want it to be.
Tuesday, July 5, 2011
Angry Bear is Angry
...that the obvious is so obvious.