The next time you hear a Liberal Democrat sneer that tax cuts won’t help balance the budget point them to this quote from the Democrats very own economic hero John Maynard Keynes:

…to create wealth will increase the national income and that a large proportion of any increase in the national income will accrue to an Exchequer, amongst whose largest outgoings is the payment of incomes to those who are unemployed and whose receipts are a proportion of the incomes of those who are occupied…

Nor should the argument seem strange that taxation may be so high as to defeat its object, and that, given sufficient time to gather the fruits, a reduction of taxation will run a better chance than an increase of balancing the budget. For to take the opposite view today is to resemble a manufacturer who, running at a loss, decides to raise his price, and when his declining sales increase the loss, wrapping himself in the rectitude of plain arithmetic, decides that prudence requires him to raise the price still more—and who, when at last his account is balanced with nought on both sides, is still found righteously declaring that it would have been the act of a gambler to reduce the price when you were already making a loss.

Remember, the Laffer Curve (and its effect) is about reducing tax rates to a ‘sweet spot’ that maximize economic activity and discourage tax avoidance thereby improve tax collection* by the government.

Historically, every time a tax cut is implemented, money flows into the government.

Via Heritage:

Over the past 100 years, there have been three major periods of tax-rate cuts in the U.S.: the Harding-Coolidge cuts of the mid-1920s; the Kennedy cuts of the mid-1960s; and the Reagan cuts of the early 1980s. Each of these periods of tax cuts was remarkably successful as measured by virtually any public policy metric.

Tax cuts… Works every time.

*Note: The government does not need to collect more money. Washington has a huge spending problem and not an income problem. More money flowing in to Washington is not going to cure the spending addiction. The idea is to illustrate that tax cuts coupled with spending cuts, will help the overall health of the private sector economy. To maximize personal freedom and long-term economic health, we should follow the advice of another great economist, Milton Friedman, who said “I am favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible“