Taxing doesn't lead to economic growth

That quote from Arthur Laffer is aimed at all you folks who are bitter and jealous, always hating on the rich instead of putting that energy into improving your own lives. The title popped in my head after checking out an interview with him in The Telegraph: Reeves could use a crash course on tax legendary economist Arthur Laffer | The Daily T In this interview, he covers a bunch of economic topics tied to his latest book, "Prosperity Through Growth". But the lesson I want to focus on isn't from that book, it's actually from his previous one called "Taxes Have Consequences: An Income Tax History of the United States." In that book, he demonstrated that every time the US hiked taxes on the wealthy, revenue from those high earners dropped, along with overall tax income, leading to negative effects for the lower-income folks due to less economic activity and fewer chances. On the flip side, whenever taxes on the rich were slashed, their tax contributions shot up, total tax revenue increased, and the poor saw benefits too. If anyone's questioning his data reliability, here’s some input from ChatGPT: And that last bit, my friends, is where socialists tend to miss the mark: the economy thrives on incentives. Sure, some socialist politicians get it, but they aim for total control over people, keeping everyone poor. They can’t afford to let an economy breed wealth through hard work and incentives because that would mean losing votes.

This is a very rich video. Part of the principles I loved that he mentioned is If you tax people who are working to pay those who are not working then in no distant time you'll have more people not working. This is very true, I've seen in my country some areas who are oil producing, their people are very lazy because government pays them free money while they're not working so it breeds an environment of no productivity among them and serious over dependence on the government. Funny enough their population is growing and their young are maintaining the status quo of not working and getting free money. Secondly tax revenue increases as tax rate is reduced and vice versa. This is true too because when the tax rates are high, companies find it difficult to remain very productive, some even fold up because they wouldn't get consumers to buy their products at much increased prices to meet up with the tax rates and remain profitable. and some even get smarter at avoiding paying taxes thereby reducing the revenue generated by the government. This is very practical. In my country there is a new tax rate to be implemented by January which is very much on the high side despite the hardship ravaging the country and almost everybody is now looking for ways to escape paying the high taxes which includes clinging to the use of crypto for transactions. This paints a familiar story with the principle above which is that the government would receive far less revenue than it has intended when passing the tax bill into law.

I have never been against capitalism. The alternatives are never better, especially in a large setting like a country, but rich people are not above criticism. People are allowed to call them out when they're doing unethical things, even though they're not illegal. People are allowed to disagree with them. If I call out a billionaire today, it doesn't mean I am doing it simply because I'm envious of him or just want socialism. Even as a kid, when I didn't fully understand capitalism and socialism, I have always argued that people should be given the freedom to make money how they want as long as it's legal and ethical. Our society survives because there is a system of checks and balances. If a person can no longer be checked, there is every chance they will abuse whatever power they have. It is because of this that I believe billionaires should be criticised and called out when they're wrong, no matter the impact they have on the economy. There is a reason America is the country it is today, and there is a reason over 40 of the top 50 richest people are from capitalist countries. The arguments people use against capitalism are never consistent because when they argue against capitalism, they only focus on the negatives and portray only the positives of socialism, which creates a very one-sided view.

That makes perfect sense. When you earn a tiny amount of money, big % does not look that big because in the end, the amount of money is not big but when you earn millions, even a 3% higher tax rate makes a huge difference, so, if there is a possibility to pay lower taxes, that's the way to go. When you set high taxes to rich people, they'll find a way to avoid paying it via various mechanisms but if you keep taxes very low, they simply won't try to waste time and resources to avoid paying a tiny amount of taxes. That's why every time taxes were reduced, the tax revenue increased.

Rich people just charge the taxes on the poor through the goods and services they are offering to the market by raising the price just to adjust by this tax increase while poor salary is still the same. Rich can hire their accountant to find loophole on their taxes while poor suffer from the higher tax alone. This is the problem on my country which we have an EVAT to all the goods we are purchasing while rich is not affected.

It is meaningless to pay any taxes till they stop the inflation completely because inflation itself is also a tax. What we really need is less government spending. Smaller governments, less taxes on the individuals and corporations. It is the governments that make everything worse. Any step they take to fix something breaks something else and they are getting paid to fix stuff but in the end they do more harm than good. In this equation I say the smaller they are, the better it is for everyone. Did you know the US didn’t have any income tax for the individuals till the 1940’s? Yes the US passed the individual income tax act only in 1944. Then a few decades later they removed the gold dollar peg and everything has been going down hill ever since.

i don't know how this works in the united states but an high taxation from the rich seems to suggest that it will lead to a high government revenue that if used to provide things for the state will be of more advantage to the poor. most times, the rich have their way of avoiding being overly taxed in developing countries while the middle class and the poor struggles the more from over taxation which most times is not calculated the way it is presented theoretically. tax implementation is ineffective in most part of the world and the fact that it is not used to do any reasonable thing makes it worthless.

I think the biggest error in the socialist thought process, is that they view the economy as a lever, where you can increase tax on X by 5%, and you'll get 10% of Y as an outcome. The truth is that obviously, the economy is not a lever. People aren't just chess pieces that you move on a board, with their desires ignored. Enforcing a certain tax, does not mean that everyone will just passively accept it. Some will leave the country, others will evade their tax, or increase prices on Z, etc. The economy is so complicated that thinking you can "manage it" is a sign of complete arrogance.

If they are not working, then who drill the oil, process it and turn into finished product for exchange? Are they not indigenes or the indigenes of that area are willing to let outsiders take the opportunity that are open. Irrespective of the fact that only qualified people are supposed to be employed in such areas. If you surf the community there are indigenes that are very qualified to work in those sectors, and sometimes the slots are limited. I dont know why anyone will be willing to take peanut than work for better money. It is not clear to me.

The government can have a favourable tax rate to the rich people which actually encourages them to invest in more inside the country, which will increase employment opportunities, tax collection from the salaries paid, and help with the circulation of money in the economy. However the taxes on the middle class should not be unbearable, let's say if a country tax 30% as income tax even if someone is earning median salary is a crime that will force him to bear heavy tax burden, it can be 15% or even less than 10% with some relaxations or something with tax exemption if he invest that money back.

It is one of those rare takes that does not feel unbalanced. You are not anti-capitalist, you are anti-blindness. You understand it is not about the money. Pretending that money is equal to virtue is Human beings forget that capitalism is not self-cleaning. It is effective because individuals would push away when it goes off track. When rich people evade criticism behind the "you're just jealous" defense, it kills that feedback loop. We need people that can both admire innovation and question excess You may believe in free enterprise and still say, "Hey, this part does not fit right here, this part does not fit there". That is the way societies become grown. Not by tearing down success, but by reminding it that success still answers to someone

Such moderate tax paying is just practically possible in countries with vision, hope and believe to help spread wealth instead of creating a society of poor people except for those that fight there way out of poverty. Some countries with moderate tax payment are portugal, hungary, bulgeria, Switzerland and others, this individual moderate tax payment polices helps reduces high poverty rate among citizens and spreads wealth to the entire nation. Some African countries experience high tax payment practice making it difficult for the middle class citizens to survive and increase the countries poverty rate. Although high tax payment polices is not only the reasons for poverty but it should be controlled to help reduce stress to low level citizens

Wow. It is very unusual for someone to watch such a long video before commenting. Kudos for that. You make good points on that subject. That's for sure. Also, there are rich people who are scum. But in this thread, I am talking about what Laffer says, that the narrative being sold that the solution to everyone's problems is to raise taxes on the rich is simply false. It does not match the data. While some of them manage to persuade people that the solution to problems is more government. More intervention. More taxes. Look at what's happening in Venezuela. They have the largest oil reserves in the world and they don't take advantage of them, making it one of the poorest countries. It all started when Chavez came to power, nationalizing companies and putting his friends in power, while paying people not to work or to work very little. Some oil is extracted in Venezuela, but far less than could be extracted in a more free-market economy.

Inflation is outrageous and we're diluted to tolerate it like it's a natural occurrence even while obvious that it's being manipulated by those who regulates the system. Inflation isn't helping matters in the trade firm or the entire economy sectors rather, it's a sentimental driving skill that's projected to provide revenues to those at the top through which the governments indirectly extort the wealthy entreprises and industries who're core production suppliers then spikes high cost on purchase and makes affordability tougher for demands and consumers. That's a tax in different dimension because, the masses will be deemed to pay extra cost before they can afford it. The truth is that these top authorities has lobbied down to the local sectors just to cover large scales of representatives working hand to hands for more enrichment while hold the masses handicapped. Otherwise, inflations isn't a natural thing.

do you know why they don’t work? because if they work, they will have less money than they were unemployed i watched this from a TedSd video of why is it so hard to escape poverty and it talked about the cycle wherein unemployed people get benefits from the government but the moment they start working, no matter how small their salary is just yet they will be excluded from government programs making it harder to work and make ends meet why work and pay tax when you can live with the bare minimum you receive from the government?

The truth is, many of those communities actually have those who are capable and educated to work in those industries but the problem is always bigger than what's on the surface, it is more of the mentality of the people and the system and not just about the qualifications. Most of the time you will find out those people are not motivated to work hard even when the opportunities to land those jobs exists, they have already gotten so comfortable with the free money they enjoy.

It's hard to keep motivated in a country where the government charges expensive taxes, as you will be working to feed the government, while having access to low quality products in exchange. Companies decrease quality as maximum as possible to lower costs, while keeping the prices expensive to maintain their profit and to pay the taxes demanded by the government in counterpart. In Brazil people work almost 05 months yearly only to pay taxes to the government (at least that is what official data claims, because on practice it looks much worse). Almost half of your life is spent on working for the government. And what is offered in exchange? Corruption, endorsement to ignorance and populism, waste of public funds on spots of jobs which shouldn't even exist. The more the individual thinks about this situation, more demotivated he will feel and consequently, less prone to work. There aren't many perspectives of thriving and prospering. We have to be really strong mentally, while making sacrifices to break those chains and overcome this wicked system.

And it is not just tax rate because if it were then Japan is one of the country with high income tax rate but still their people are happy to pay those taxes because they trust their government with their money and seeing that whatever the tax paid coming back to them in one or the other way whereas in some countries the government just collect tax and does nothing in return which makes the people to evade taxes.

Its a known fact that whenever there is a tax increase, the poor are negatively affected, that is why we often time see cases of tax invasion and arrests but let say a country tax income tax on business and the business people receive those tax but shift the tax burden on the people this give them the relief on tax increase but at the same time the consumer's have alot to face in terms of tax.

The oil sector pay huge right? What mindset or mentality that will make anyone not to make money? I dont just understand...well like you said, the problem might be bigger than what we think. And if I'm to guess, it has to be from people in charge of giving those positions out. The corruption that happens these days is high. People who prefer to place someone without any skill because they are related, rather than put the right person in that position.