In response to:

Do Tax Cuts “Starve the Beast”?

Bat11 Wrote: Jan 08, 2013 6:49 PM
The Republic ended in 2008-09 after TARP and Stimulus, when Congress figured out that they could borrow to infinity without personal consequence. By decoupling revenue and expenditures, they guaranteed our ruin. The 51% or the 47% (or whatever percent ) could care less. When butter is $50 a pound, they still will blame Bush...and then eat their young.
Peter220 Wrote: Jan 09, 2013 9:21 PM
The U.S. has been decoupling revenues and expenditures since World War II when stimulating growth and employment became the objective of fiscal policy. First the Keynesians, then the supply-siders disregarded the traditional economics of the Austrian school to espouse the wrongheaded premise that the aim of fiscal and tax policy is to stimulate growth. While empirically it worked short-term, we now face a long term debt crisis with sluggish growth. Our ecomony is being run by the FRB central bank and too-big-to-fail banks that are wards of the state.

There’s a debate among policy wonks about whether a no-tax-hike policy is an effective way of restraining the burden of government spending.

At the risk of over-simplifying, the folks who support the “starve the beast” theory argue that there are political and/or economic limits to government borrowing, so if you don’t let politicians tax more, you indirectly impose a cap on total spending (outlays = tax revenue + borrowing limit). We’ll call this the STB approach, for obvious reasons.

Critics of the theory, by contrast, say that a low-tax policy creates fiscal...