Lowering, Not Increasing, Taxes Increases State Revenues

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One of the things I learned from economics (if not from Econ 101, something pretty close to that) is that one of the worst things that the government can do when its in a financial crunch as we are today, is to raise taxes in order to cover shortfall. You guys know that I have advocated and continue to advocate deep spending cuts: we can’t afford not to. However, even with these cuts, we still have to raise enough revenue for the state to keep services going until we can privatize them. The shortsighted and wrong view would be to raise taxes to cover that shortfall. This won’t work, and will frankly make things worse, as business will hire less, shut down, and people will spend less. The trick is to REDUCE taxes. Once taxes are reduced, then businesses will expand and hire, people will buy more, and overall tax revenues will rise. Unfortunately, this runs contrary to the ideals of this administration, who are happy to start and run class wars which never existed here, so I bet that we won’t see taxes come down anytime soon.