A Comment on the Laffer Model

One feels constrained to step lightly in an examination of the Laf- fer curve. Laffer contends that higher tax rates, by removing incen- tive, will discourage work, lead to less output, and thereby reduce government’s total tax revenue. Surely the contention that lower tax rates will yield greater tax revenue is appealing. It should come as no surprise that it is as popular as apple pie and as holy as moth- erhood. I am painfully aware that, entering the arena with Profes- sor Laffer, I can only lose—if not directly at his hands, and because of the power of his theories, then because winning the debate would be just a Pyrrhic victory. Even the man on the anti-Laffer side still must continue to pay the present, unacceptably high, taxes; the reward of his position will be no further hope for, nor progress toward, tax relief, But the validity of the Laffer curve is indeed open to question, as I hope to demonstrate...