This subject (somehow) came up twice in as many days. Decided to give it a quick look to see why these discredited ideas are still around, some 45 years later. No, the Reaganomics idea that tax cuts create growth and pay for themselves is not true. Not even half true. Yet there is no call to go back to the saner, more effective policies from before this failed “experiment”. From the Wiki.
Karl Case and Ray Fair wrote in Principles of Economics, “The extreme promises of supply-side economics did not materialize. President Reagan argued that because of the effect depicted in the Laffer curve, the government could maintain expenditures, cut tax rates, and balance the budget. This was not the case. Government revenues fell sharply from levels that would have been realized without the tax cuts.”
Steven A. Guccione 