Earlier this week, we reported that liberal statistics were refusing to show that tax hikes destroy the stock market. Well, they are at it again: this time, statistics are maliciously showing that cutting taxes does not lead to economic growth!
This graph shows countries that have implemented policies of cutting the top marginal tax rates over the 30 or so years. It compares the amount of the tax cut with the percentage of of GDP growth arising after the tax cut.
Now, any good conservative knows that more tax cuts for the rich always, always, always lead to more economic growth no matter what. That’s just intuitively obvious, and we hear it on Fox News over and over again, therefore it cannot be wrong.
SO WHAT’S WRONG WITH THESE DUMB COMMUNIST STATISTICS?
Somehow, this graph is showing that there is no relationship between the size of the tax cut on the top income earners, and the amount of GDP growth that follows!
One of two things is possible: either tax cuts on top income earners really don’t have much of an effect on economic growth compared to the wide variety of other things that can impact a country’s economy…… or, these statistics are simply skewed by some kind of mysterious liberal bias!!!
graph data source: Piketty, Thomas, Emmanuel Saez, and Stefanie Stantcheva (2011), “Optimal Taxation of Top Labor Incomes: A Tale of Three Elasticities“, CEPR Discussion Paper 8675, December.
graph found via: voxeu.org