Josh Rosenbluth wrote:
>>>A government gets it's money from the workers and the less number of workers
>>>the less money that government has to spend.
>>
>>Only if it collects x amount per worker. That's not how our system
>>works. It's based on a "progressive" tax which generally punishes
>>achievement and encourages sloth. Revenues are a function of tax rates
>>in relation to economic activity. Increased levels of economic activity
>>combined with lower tax rates (which usually spurs economic activity)
>>can produce more revenue than higher tax rates (which usually slow down
>>economic activity) and a slower economy. JFK and Reagan both cut tax
>>rates, and net revenues increased as a result of the economic activity
>>which followed in each instance. We've also seen the same effect with
>>the tax rebates in the last couple years, particularly in the last quarter.

I stand by what I wrote, particularly in the context of the OP's
benighted statements. Since you took the time to reply, I'll address
your statements.

> In the case of Reagan, real income tax revenue was lower in each of
> the first 5 years after the tax cut than the year before.

http://www.heritage.org/Research/Taxes/images/chart.gif

And before you whine about Heritage Foundation being right-wing, the
data are from OMB.

> Revenue
> jumped in year 6, but only because loopholes were closed.

TEFRA had *some* effect, but steady economic expansion had a greater effect.

> Economic
> activity, as measured by the GDP growth rate, was not any faster after
> Reagan's tax cut than it had been historically,

It was a lot higher than it had been under the previous administration.
Two factors for that: lower interest rates and a rebounding economy.

> or even in the
> business cycle just prior to the tax cut.

Which isn't saying much considering Carter's malaise.

> As far as Bush's tax cuts goes, the jury is out. Revenue is way down.

A function of the 1999-2001 recession, which was compounded by the
economic slowdown following 9/11.

> The GDP growth rate since the first tax cut has been about 1%-point
> lower than either the historical average or the previous business
> cycle.

Yes, and there are some unique exogenous variables to account for that,
not the least of which is the terrorist activity which caused a lot of
Americans to stop going out in public as much as they had before.

> But, it is too early to make conclusions because we are only
> in the beginning of an expansion.

Yes, and how fast did GDP grow last quarter? Try 7.2%, which is the
largest gain in any quarter since the mid-80s when you suggest the
economy didn't expand. The quarter before last, GDP grew 3.3%. PCE
(personal consumption expenditures) -- the primary cause of much of the
slow-down in 2001-2 -- is leading the way. Jobs are a lagging indicator,
and there's some encouraging news there. You can wait to make your
conclusions, but apparently employers and those who got tax rebates are
reaching their own without you.