Quote Originally Posted by Lemur View Post
There is such a thing as the Laffer Curve, which demonstrates that too-high taxation drives people into tax avoiding behaviors, lowering the overall take. So in some situations, lowering taxes really does increase revenues. However, some people take this as a fundamental truth, that lower taxes will always produce more money, a thought so illogical and self-evidently false that it's kinda hard to argue with.

Historically, we're at very low levels of taxation right now. So arguing that further tax cuts will yield more revenue has more to do with posturing and dogma than anything empirical. The Bush tax cuts, which heavily favored high-income earners and investment revenue, failed to yield a significant gain in revenues, which would indicate that the U.S. was already at or below the optimal point on the curve.
not forgetting its close association with supply side economics:

http://en.wikipedia.org/wiki/Laffer_...side_economics

taxation at a level over 40% has been shown to have a serious impact on long-term growth potential.

http://ime.bg/uploads/OptimalSizeOfGovernment.pdf