Tuesday, July 29, 2008

Supply side fails again

White House Predicts $482 Billion Deficit

Suggesting, once again, that we've been on the left-hand side of the Laffer Curve all along. In fairness, though, the graphic does demonstrate that the projected deficits are record-setting only in absolute dollars, but not as a fraction of total GDP.


James Hanley said...

Also, to be fair, it doesn't prove we were on the wrong side of the Laffer Curve. The question that answers that is whether tax revenue has increased. Tax revenue may have increased, but not as fast as overall spending.

But that aside, the deficit figures remind us once again that Republicans are going to have a hard time regaining the crown of fiscal responsibility.

James Hanley said...

Tyler Cowen, one of the economists I respect the most, also says we're on the left side of the Laffer Curve. You're in good company!