Some more math

Infinity and BEYOND (0.00 / 0)

As some astute observer said in another comment,

You need to have magical Republican thinking where we can eliminate all taxes and spend as much as we want. That's the ticket.

Californians like optimism and hope, not taxes, doom and gloom.

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by: Aeolus @ Mon Feb 16, 2009 at 21:14:31 PM UTC

Other Costs (0.00 / 0)

I work for the University of California as a small cog in a very big machine but still manage to make a living as a computer drone. I earn about $20 an hour to work on the database that tracks the "extramural funds" (money not from the UC or the State).

If I count up the hours that I had to spend last year with the economic freeze the state put on spending, I come up with about 20. So this is $400 for my time. But there are other people involved. The people doing the research, the people managing the research, the people managing the finances, the lawyers so we do got sued, etc, etc. And I'm at the low end of the UC totem pole. There is a lot of time involved in just keeping track of this (job security!)so the UC is spending a lot just to keep track of what the clowns in Sacramento are doing.

If the legislature is so hot on cutting costs the let them and their staffs do their work as a volunteer effort and their local people pay for the salaries and expenses on an as needed basis. Make it all public, advertising even :) I know, it probably won't work, and so much of this is just CYA.

O well, when I get to be King...

k

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by: Unkakunk @ Tue Feb 17, 2009 at 06:42:45 AM UTC

Infinity (0.00 / 0)

If tax cuts always stimulate growth, then if we reduce the tax rate to zero, economic growth should swell to infinity.  Right?

No.  Suppose that the number of lost transactions is proportional to the tax, for example.  If the tax goes to zero, you lose zero transactions to taxes, but the number of transactions doesn't go to infinity.  Yet economic activity always rises as you reduce the tax.

(That's in fact a reasonable model, for small taxes.)

It's a little confused with the Laffer curve, which argues about government revenue from taxes.  If you have a 100% tax rate, the government gets zero revenue, because nothing taxable happens at that rate.  If you have a 0% tax rate, the government gets zero revenue, because the rate is zero.  Laffer's argument is that there is therefore a rate somewhere between 0% and 100% that maximizes government revenue; and therefore in addition that decreasing the rate sometimes increases revenue, depending only on whether you're below or above that maximum.

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by: rhhardin @ Tue Feb 17, 2009 at 12:40:58 PM UTC