Can We Balance the Budget By Raising Taxes?

Students: Hear Antony Davies live at the Exploring Liberty http://lrnlbty.co/x5Zi3P or Scholarship and a Free Society Seminar http://lrnlbty.co/wz3Ao9 this summer

Want a closer look at the chart? See Prof. Davies' PDF here: http://www.antolin-davies.com/conventionalwisdom/budget.pdf

Summary: Professor Antony Davies asks whether the United States can balance the federal government's budget by raising taxes. Looking at historical data of tax rates compared with government revenue, he shows that government revenue has remained essentially constant since 1969, despite wide changes in marginal tax rates. Prof. Davies concludes by suggesting that the optimal tax policy is be a simplified system with low rates.

Category:

Education

Tags:

• United States
• government
• fiscal
• crisis
• balance
• budget
• raise taxes
• tax policy
• tax code
• tax rates
• marginal tax rates
• learn liberty
• learn
• liberty
• video
• freedom
• deficit

[killroy71]

You'll never get a Democrat to believe that simple is better than complex.

[residentzombie]

@MareSwiss Taxation is theft period. Noone says that gov't needs to be in charge of building roads and bridges, the private sector can do these things even better thank you. If it is deemed necessary though to have gov't do this function or any similar function not related to the preservation of protecting individual freedom then the only moral way to raise funds is on a fee for service basis. Roads to be paid 100% with tolls and registration fees relating to vehicle use.

[DrNikol2007]

@TheLeperMessi4h 2/what is happening is the society regulates and maintains it 18% of GDP by applying different taxation percentage for different parts of the society in different times, while maintaining 18% level.

[DrNikol2007]

@TheLeperMessi4h 1/He is not right you neither. It works this way. He admits that the taxes are around 18% of the GDP. Let's assume this is an optimal percentage for US society. He does not talk how the tax influx in the budget is distributed. If the national revenue is unevenly distributed (small number of people get the bigger par of it) the rest of the population is able to pay smaller part of the tax influx, then the rich must pay more, so we have 18% taxes as a part of GDP.

[TheLeperMessi4h]

imagine a world where we knew the amount we had to pay by multiplying by .18 rather than figuring out deductions, returns, charitable donations, etc

[TheLeperMessi4h]

@cosmopolite66 the point he was trying to make was the fact that raising income taxes does nothing to help increase tax revenue

[JNathanK2011]

Well, we already owe money we have to pay off. They should raise the taxes, as well as lower the budget.

[chaz706]

@louisiananlord17 It's already destroyed the EU -- Look at Greece and how that's playing out.

It's definitely destroying the US... that's for sure.

[louisiananlord17]

@residentzombie Taxes are a neccessary evil, that's what happens when the middle-class isn't smashed even in society. But I agree that raising taxes isn't the soultion.

[louisiananlord17]

@killroy71 I agree, that's so true. Stupid Kensyian economics are destroying the US and possibily the EU.

[residentzombie]

@cosmopolite66 That is the point. Only consumers know where roads need to be built. Have you never heard of Solyndra?

[residentzombie]

@cosmopolite66 Did your shallow brain ever stop to think why we would need roads built where noone lives? lol