Economist: ‘It’s 1979 All Over Again’ In America

Discussion in 'News / Current Events' started by Revmitchell, Sep 6, 2015.

  1. Revmitchell

    Revmitchell
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    Read more: http://dailycaller.com/2015/09/05/economist-its-1979-all-over-again-in-america/#ixzz3kya9AsVQ
     
  2. InTheLight

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    Article gives no reasons to believe economy today is similar to 1979 except for Laffer's say-so.

    “One of the nice things about being very old, is you can actually remember old time events", Laffer says, "This is 1979 exactly.”

    I remember 1979 as well.

    Interest rates were double digit. Interest rates now are non - existent.

    Back then there were lines at the gas stations. Now we have a gas glut.

    The unemployment rate was 6% and climbing; today it's 5% and dropping.

    Budget deficits were increasing; today they are decreasing (admittedly from record highs).

    I could go on and on but I think I've made my point.
     
  3. Crabtownboy

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    Laffer must be playing politics as he neglected much in his article.

    For instance, inflation was running at a double digit rate. It is running very low now.

    Also the world is a very different place now than in 1979. China was not a factor at all in the US economy then. It is a big factor now. If the Chinese economy collapses the US economy will take a big hit.

    This is a pretty worthless article as so much is neglected.

     
    #3 Crabtownboy, Sep 6, 2015
    Last edited by a moderator: Sep 6, 2015
  4. preachinjesus

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  5. InTheLight

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    He's famous for the "Laffer Curve" which is accepted by most economists as theoretically true, the problem is where to decide the line is drawn where more taxes result in lower tax revenues.
     
  6. Crabtownboy

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    The Laffer Curve is too simplistic to base an economy or a tax program upon. It is based on a single tax rate with a single labor supply. This can never happen in the real world. The Laffer curve is the holy grail of supply side or trickle down economics. Trickle down has been shown that it does not work in the real world. It is more likely to trickle up. George H.W. Bush called it voodoo economics.



     
  7. InTheLight

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    No it isn't. It's based on overall tax revenue vs. overall tax rate.

    No, it's not. It's the holy grail of flat taxers and/or tax cutters.

    Whatever you want to call it, go look at the growth of the US economy in the 1980's under Reagan policy. Whatever that was, it worked.
     
  8. preachinjesus

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    His Curve theorem is, perhaps, his best work. The challenge is the arbitrary measurements as you've mentioned. Ergo my video clip. ;)

    His other economic work has received mixed reviews. I'm not a Keynsian of course, more Chicago School (during the good ole days) than anything.
     
  9. Crabtownboy

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  10. targus

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    Unemployment 5% and dropping?

    All you have to do is disregard anyone who has been without a job for three months or more.
     
  11. InTheLight

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    No, it doesn't. I'm quoting the article you quoted here:

    The Laffer Curve itself simply illustrates the tradeoff between tax rates and the total tax revenues actually collected by the government.


    There is nothing about a "single labor supply" with regards to the Laffer Curve.


    I never said the Laffer Curve was policy. Supply side economics is an economic policy that states if tax rates are cut TO MAXIMIXE THE EFFICIENCY OF THE LAFFER CURVE then tax revenues will increase because economic growth will increase. This is exactly what happened in the 1980's under Reagan.

    Nope. It's holy grail to tax cutters. The connection between the Laffer Curve and supply siders goes only so far as tax cuts will increase economic growth. Once the economic growth is maximized supply siders will not advocate further tax cuts whereas tax cutters will always advocate tax cuts believing that tax revenues should always be reduced, because they think reducing taxes will always lead to economic growth.
     
    #11 InTheLight, Sep 6, 2015
    Last edited by a moderator: Sep 6, 2015

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