Monday, September 24, 2012

Once more, with feeling: Trickle down doesn't work

Never did and we doubt it ever will.

Economist Jared Bernstein reminds us:
...over the long, historical record of special tax treatment for investment incomes and tax cuts to the top marginal tax rates, one simply doesn’t find significant correlations with greater investment, savings, productivity, or income growth. 
Lowering the top tax rates do correlate with something, though: higher income inequality. Amazing that people still pretend that tax cuts for the rich (the, ahem, "job creators") will help us all prosper. Especially since the author of the trickle-down theory, Arthur Laffer, made up his theory on a restaurant napkin.