Thomas Sowell, a prolific author of enlightening economics-related texts, devotes his latest column to an endorsement of Stephen Moore‘s new book, Who’s The Fairest Of Them All?
[T]his little gem of a book exposes, in plain language and with easily understood facts, the whole house of cards of assumptions, fallacies, and falsehoods that constitute the liberal vision of the economy.
Yet that vision triumphed on Election Day, thanks to misinformation that was artfully presented and seldom challenged.
The title “Who’s the Fairest of Them All?” is an obvious response to liberals’ claim that their policies are aimed at creating “fairness” by, among other things, making sure that “the rich” pay their “fair share” of taxes. If you want a brief but thorough education on that, just read chapter four, which by itself is well worth the price of the book.
A couple of graphs on pages 104 and 108 are enough to annihilate the argument about “tax cuts for the rich.” These graphs show that, under both Republican president Calvin Coolidge and Democratic president John F. Kennedy, high-income people paid more tax revenues into the federal treasury after tax rates went down than they did before.
There is nothing mysterious about this. At high tax rates, vast sums of money disappear into tax shelters at home or are shipped overseas. At lower tax rates, that money comes out of hiding and goes into the American economy, creating jobs, rising output, and rising incomes. Under these conditions, higher tax revenues can be collected by the government, even though tax rates are lower. Indeed, high-income people not only end up paying more taxes, but a higher share of all taxes, under these conditions.
This is not just a theory. It is what hard evidence shows happened under both Democratic and Republican administrations, from the days of Calvin Coolidge to John F. Kennedy to Ronald Reagan and George W. Bush.
