“President Reagan cut taxes and deficits soared.” Those are the words of Washington Post columnist Megan McArdle. Decades after Reagan was served as president, his tax cuts are still being debated. And the debaters still misread what happened decades later.
While McArdle says it’s “a mistake” for Democrats to “treat the Laffer Curve as an irreverent joke,” she too rejects the theory expressed by supply-side happy talkers that “it was possible to cut taxes without cutting spending." But McArdle, like Democrats, Republicans, and Supply-Siders, misunderstands what happened with the Reagan tax cuts and why deficits soared in concert with them.
Read Full Article »
