Two Questions for the Supply Siders

Fri, 04 Apr 2008 18:02:47 +0000

Troy posted a link to the video of the CRFB dinner's panel discussion on "Are Fiscally Responsible Elections Possible?" From the lineup, you might have expected this to get interesting. Mark Halperin was the moderator. There were two former OMB directors in Leon Panetta (Clinton) and James Miller (Reagan). There were economic advisors from the three remaining Presidential candidates in Gene Sperling (Clinton), Jeff Liebman (Obama), and Doug Holtz-Eakin (McCain).

Things did get interesting around the 33 minute mark, when Miller started peddling supply-side gibberish. <!--break-->Panetta and Sperling gave him grief, but the panel blessedly moved on. I started thinking about the right way to put the supply siders on the spot. Here are the two questions they should answer if they believe that the 2001 and 2003 tax cuts raised revenues:

  1. How much wider would the deficit be now if those tax cuts had not been enacted?
  2. How much lower would tax rates have to go in order for you to stop insisting that further tax cuts would raise more revenue?

I wonder what we would get.

Elsewhere in the blogosphere, Jeff Frankel spends some time documenting extreme supply-side statements by Republican officials, wondering whether McCain is going to join them, and poking fun at those who simultaneously believe that tax cuts raise revenue but also "starve the beast."