Nothing much to do with forthcoming GE which is likely to be a Brexit proxy.

100pc agree. Sorry for the de-railing. 🙁

Ok, so what do I use if I shouldn’t be using a laffer curve.

I’ve got a list of historic tax rates for cheese for this year [1] and I’ve got a list of cheese revenue numbers. How do I describe/present them in a way that suits you?

If I want to say “64pc cheese tax give us peak revenue on the laffer curve” what terminology *should* I be using and what chart should I use to show the data graphically.

A graph can.

John 11:35.

So this whole argument has been that people don’t think a line on a chart of revenue against unit tax level should be called a Laffer Curve.

You have no problem with data based decision, or the line being drawn form the data or the concept of working out revenue, you just prefer it to be described as “a graph” rather than a Laffer Curve. …and that was worth an evening of our lives wasted squabbling.

I shall henceforth refer to the hypothetical Laffer Curve as Laffer Curve and specific instances of it as ‘A line on a graph’ and we’ll all be happy.

Just say a 64% cheese tax maximises revenue.

Trust me I will. After tonight I will never say “64pc is the sweet spot on on Laffer Curve”. It’s not worth a whole wasted Friday night.

You have no problem with data based decision, or the line being drawn form the data or the concept of working out revenue, you just prefer it to be described as “a graph” r

No, I absolutely want this. More of it, whenever possible, data driven decision making. Yes. Please.

I don’t really care what you call the Laffer curve as long as it includes BS, bunk, junk science, discredited and wrong. Not a graph, a drawing with no artistic value. A veritable economic BoJo.

graph[1]

[1] Which is not a laffer curve. Absolutely not.

..and 12 hours later it’s ended with us literally agreeing that we’re all ok with using the laffer curve, just with a different name

See now I thought you’d go it and then you put words in my mouth. A graph is a picture made by plotting data points. The shape can usually be described by a formula.

A laffer curve is a doodle on a napkin with no connection to data whatsoever.

Not a different name – an entirely different thing.

outofbreath

Member

So this whole argument has been that people don’t think a line on a chart of revenue against unit tax level should be called a Laffer Curve.

No. The argument has been that the Laffer Curve is not a chart of revenue against unit tax level.If you were to chart revenue against unit tax level, you wouldn’t get a Laffer Curve- you’d get a Nonlafferian Squiggle With Weird Bits.

Put it a different way- they didn’t take that revenue chart and attach the name “Laffer Curve” to it- they’re two distinct and different things.

You’re attached to your cheese tax but really, that’s the extent of oversimplification you have to go to before the Laffer Curve gets close to reality, and even then it fails- the real world numbers wouldn’t yield anything like his curve

But it was invented specifically in reaction to Gerald Ford’s proposed 5% increases on corporation tax, and income tax for individuals earning over $150000 per year (at the time, equivalent to 14 times the average household income- so equivalent to $8250000 today) How closely do you think economic behaviour in those 2 categories resembles your cheese tax?

(there’s a distinction here that I think you might not have appreciated; just as the Laffer Curve doesn’t map the actual relationship between taxation and revenue, the concept of that a tax raise will not always lead to a tax income increase is not the same as the Laffer Curve. The Laffer Curve is an attempt to take that concept and force it into a convenient shape, without regards to the actual numbers. Dismissing the Laffer Curve doesn’t mean throwing away the concept that was its springboard, it only means accepting that this specific rendition of that concept doesn’t work. You’ve conflated the two a fair bit in your posts.)

Where I started with this was pointing out that it’s always been a tool to promote tax cuts. The history proves that’s the case, but if you do still doubt it- can you find a single case where anyone in a position of power has invoked the Laffer Curve to argue for a tax hike? And can you find a single case where Laffer or his disciples looked at a tax rate and decided that actually, it was too low? For that matter, can you find any case where Laffer recommended a tax cut, it was applied, and revenues increased?

Reaganomics and the Kansas experiment are spectacular examples of the opposite, and Trump’s tax cuts are going to be the example people point at in 10 years if this thread’s still running, but where are Laffer’s victories?

(he probably considers the Kansas experiment a victory tbh; it didn’t work out according to his theory, and it did enormous harm to the economy and the people of Kansas… but it did result in a tax cut for rich people, which is exactly where he came in)

The argument has been that the Laffer Curve is not a chart of revenue against unit tax level.

Yes it is. X axis is rate of a given tax. Y axis is revenue at that rate.

Anyway it doesn’t matter because we’re all happy now. You’re happy because I’m not calling a graph of rate against revenue a laffer curve and I’m happy because I have way of calculating/saying what I want to describe that meets with your approval which is *very* important to me.

The Laffer Curve posits that revenue and tax rate are related in a particular way… to say the Laffer Curve was nonsense dreamt up to support a political objective isn’t to claim that revenue and tax rate are not related at all, or to claim raising tax rates can reduce the revenue generated. No one has ever plotted tax rate against revenue using real figures and produced a Laffer Curve… most attempts show jumps, thresholds and regions of little change… which is as you’d expect given the existence of competitors for investment and retail for whatever you choose to investigate, and that, you’re measuring the effect of two different things… the elasticity of both those buying or investing, and those producing or selling.

I tried very hard not to use the word elasticity to keep it as simple as possible. But failed. The important thing was that Laffer was suggesting a simple relationship that suited his ends, and that he just pulled of his arse. Of course tax revenue changes as the tax rate changes, and tax rate increases can map to revenue reduction, but they don’t do so in a way that forms a Laffer Curve.

Shall we start another thread on the election and leave this one to the armchair economists?

If you did plot those numbers, you don’t get the Laffer Curve- you get a chart of tax and revenue. They are not the same thing

Sound plausible, but on the other hand we don’t change the name of a supply/demand chart when we move from abstract to estimates so I’m sceptical and google hasn’t helped me so linky please.

Where I started with this was pointing out that it’s always been a tool to promote tax cuts.

Well duh! If you’re arguing for a tax raises you pretend tax revenue for that thing is 100pc in-elastic so you don’t mentioning the graph. If you’re arguing to cut a tax you pretend revenue is *really* elastic so you do mention the graph.

I got up before light and went out on my bike this morning, just got back. I nearly had a very serious off into some very unfriendly scenery because I was thinking about ****ing Laffer Curves when I should have been thinking about where I was putting my front wheel! I’m still shaking now. Time for a sweet tea and a sit down.

All this argument ignores the fact that economists have been universally useless at predicting anything. Remember economists in the 70s telling companies that they needed to be diversified conglomerates to survive? Or the disastrous reliance on supply side economics in the 80s? There are innumerable other examples.

JP

I think Farage is serious about standing in most constituencies and that will really damage the tories badly.

I am now thinking well over a hundred seats to the smaller parties and a hung parliament.

Is it really tax rate that matters most? I’d have thought it was more to do with standard of living and balance of income over expenditure.

*looks out of window at grey skies and drizzle*

If that were the case I’d have moved to California years ago!

I think Farage is serious about standing in most constituencies and that will really damage the tories badly.

It will be great news for the Tories if Farage manages to put forward some candidates, because Johnson can then claim that the Tory party is once again the party of the sensible, moderate, centre-right voter, compared to the loons from BXP Ltd.

https://www.newsletter.co.uk/news/politics/psni-called-in-as-uda-tells-uup-to-step-aside-1-9127598/amp?__twitter_impression=true

The amazing pro leave alliance in NI showing it’s vision for this election

What does it mean in a seat which swung 7% to Labour in 2017 with a majority of around 2,300? Well, maybe the Lib Dem candidate takes hardcore remain votes from Labour and lets the Tories in? Or maybe he attracts Tory remainer voters who would never vote Labour, but don’t want to support Boris. Or maybe he does a bit of both and that nullifies his impact.

What would a Brexit Party candidate do? Potentially I guess, take some votes from Tory leavers, but also maybe Labour leavers who won’t ever vote for a Boris Johnson Tory party?

Both the main parties are going to haemorrhage voters to both the Libdems and BP in different and often unpredictable ratios.

And are people going to vote on the basis of their Brexit views? Or wider issues? Or local issues and personality?

Some local friends campaigned in the Local Elections over a highly significant local issue. On the door step literally all people wanted to talk about on the doorstep was Brexit. This is in *local* elections where a clear threat to to their day to day happiness looming and where the candidates have zero influence over Brexit.

So based on that I predict that Brexit will overwhelmingly dominate this election although the two main parties will try to avoid that. Which shows how polarised we’ve all become, before the Ref nobody really seemed to GAF about the EU.

Look, neither Farage or Johnson give a shit about Brexit, it is a tool to achieve their own ends… they are looking after number one… and no, not all politicians are the same, these two are apex level self serving pricks, don’t fall into the trap of thinking either is pure to any cause broader than “me”.

neither Farage or Johnson give a shit about Brexit

Boris yes, he’s an out and out remainer. I read a Bio of him years ago and even then when he’d built a journalistic career out of trashing the EU the evidence was ovewhelming that he had massive affection for the EU. His Dad was an MEP and worked for the European Commission. The EU is Boris’s hinterland.

Farage no. He is genuine, IMHO. (Which doesn’t mean he wouldn’t sacrifice something he really believed in for significant personal gain, how many of us wouldn’t?)

EDIT: I’m not sure hinterland means what I think it does. I can’t be arsed to think of a better word. Hopefully the context makes it clear. 😀

Boris yes, he’s an out and out remainer.

Yes, we know that long time ago but just want to see how good a trick he can come up with for entertainment sake.

Also I want to see in my lifetime a main political party(s) to be decimated from British politics or history. For the moment and as far as my crystal ball forecast is concerned they are just about on course for that to happen. Good fun and good laugh.

Farage no. He is genuine, IMHO.

He is genuine.
I support him by voting for the party he is in.

Farrage is in this for one thing (himself basically).

I suspect he’ll go for MP in the best chance constituency he can find, but to achieve this he has to do a ‘deal’ with the Tories so they don’t go up against him. Possibly if they realise people in the North might not vote Tory regardless, the Conservatives will maybe ‘forge’t to put a candidate up for that seat. And in return Farrage will throw the rest of his party under the bus (see what i did there…).