@Cycloptichorn,
Cyclo has the unpleasant habit of responding not to the point or argument he claims to be addressing, but rather to some other snippet of a point which suits him at the moment and then claiming in a rather bombastic and largely ignorant way that he has demolished whatever argument, observation or point that was at issue,
With respect to marginal tax rates, and Cyclo's claims of "doing the math", the simple fact is that if a marginal tax rate is reduced from (say) 40% to (say) 36% then if the amount of reported income subject to that tax rate increases (over any period of time) by more than the ratio of 40/36 (=10/9 = 1.1111, or a little over 11%) then the government will increse its revenue from that tax in real terms. Moreover,since the increase is concurrent, no present value adjustment is required.
This is the elementary mathematical issue which Cyclo claims to have mastered, but didn't address at all.
An 11% increase in some category of total income for the population is indeed a substantial thing. However, its occurrence over (say) a two year period would not amount to an unprecedented or even unusual occurrence in even reasonably good economic times. Many things can influence the amount of total income reported under such a tax. The obvious ones are real growth in earnings and an influx of people into the tax bracket in question - both results of overall economic growth (or inflation if the brackets aren't indexed). Another factor is a shrinkage in the underground (cash & barter) economy, or, stated another way, a reduction in the distortions to normal economic activity that results from the strategies (both legal and illegal) that people everywhere employ to evade taxes. All three phenomena (an increase in the number of taxpayers in the bracket in question; a real increase in their average reported income; and a shrinkage of the underground economy) occurred following the Kennedy and Reagan tax cuts in this country and those under Margaret Thatcher in the UK. All three tax cuts were followed by periods of high economic growth and relatively greater prosperity.
It would be wrong to assert that the subsequent periods of growth & prosperity were the exclusive result of the tax cuts. Many other faxtors were involved. However the tax cuts were indeed an associated and contributing factor to increased productive economic activity.
The counter example of excessive taxation crushing economic activity is also both true and demonstrable. At the other extreme most (not all) overtly socialist schemes to level wealth or directly mananage most of the the economic activity of a country have led to uniform poverty, corruption and various forms of tyranny. The obvious examples are the former USSR and its satellites, China before Deng, and most of the first generation governments of post colonial Africa. These stories are well-known & documented, and I won't elaborate on them.
There are relatively successful and equitable societies that do pursue far more extensive social welfare schemes and the attendant higher taxation levels than the USA. The Scandanavian countries and other European powers are examples. However they are very different from us in several important respects - having largely monolithic cultures; low levels of immigration (and little desire to see that change); and often awful histories of warfare, destruction and social revolution that have contributed to their contemporary "social contracts". It is my opinion that these countries are already in serious, and probably irreversable demographic decline, and the combined stresses arising from that and others associated with external population pressures are very likely to render their current systems thoroughly unsustainable. In short despite the imperfections of our system, it is more sustainable and better adapted to the actual conditions we face than the alternatives so eagerly sought by Cyclo and others.
The annual deficit in this country's government actual operations for the past year, and budget fort the next budget have oncreased dramatically. Facts that defenders of the administration habitually evade with claims that "it happened before their watch" or "it wasn't our fault". However, the clear trend implicit in the new budget and the political proposals of the Democrats is for growing dfeficits to create payoffs for their constituents, and growing taxes to pay for part (not all) of them - and no forseeable reduction of the deficit (apart from the unbelievable rosy assumptions they make for the out years).
That this would do irreparable harm to the economy appears beyond doubt. That the public has already become aroused to the danger is also beyond doubt. It is also increasingly evident that the Administration is becoming divided and somewhat paralyzed on these issues. The bold rhetoric continues about health care "reform"; increased spending and increased taxes (on others) to pat for some of it. However, to an increasing degree no real action is being taken.
The next ten months are likely to be interesting.
