A study by Obama-supporting economists Romer and Romer found “no support for the hypothesis that tax cuts restrain government spending; indeed … tax cuts may increase spending. The results also indicate that the main effect of tax cuts on the government budget is to induce subsequent legislated tax increases.”
This is because major tax cuts, as supply-siders claim, stimulate more private economic growth and therefore provide government with more money to spend. This is precisely what happened in the 1960s and 1980s when tax cuts led to greater prosperity, but also greater government spending and ultimately deficits. These Obama economists are dishonestly leaving out this important fact, implying that tax cuts are bad (from a limited government point-of-view) because they lead to greater government spending. Under liberals and (sadly) under conservatives as well, you can always be sure of one thing: Government will continue to expand and spend more. If government stimulates the economy by lowering taxes and reducing regulation, then government will take that extra money from the economy and spend it on political pet projects and programs; or, in cases like right now, when government is strangling the private economy through the threat of massive expansion, major controls and huge tax increases, government will likewise spend more and more. The common denominator is that government likes to grow. The time has arrived to stop looking to government (and that includes flaky “conservatives,” including newly elected ones from Massachusetts) to solve our problems. Government IS the problem. The people have to bring their government into line; not the other way around.