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Sunday, January 31, 2010
Tea Party update
The Tea Party movement is alive and well. I remember attending my first Tea Party gathering last April 15, and now the movement is organizing and preparing to announce its Contract From America this coming April 15th. Glenn Reynolds has a good article that explains what's going on here. You can vote on what you think should be the elements of the Contract From America here.
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3 comments:
I dearly hope the Tea Party concentrates on balanced budgets, and eliminating federal subsidies and cross subsidies.
My fear is that the Tea Party will agree on tax cuts (yippee!), and overlook extensive federal rural subsidies.
One of the largest income redistribution schemes is from urban areas to rural areas. Red states do very well by Uncle Sam, financed by Blue States. It would be great if everybody got to keep their own money.
Obama is proposing a $4 Trillion dollar budget.....add in $3 Trillion from State and Local government and it appears that half our GDP is simply government consumption......
We are going to need some really strong tea.
Alstry:
Excellent point regarding total government consumption.
One point regarding the Laffer Curve is the equilibrium of taxation. That size and scope (scope being an indirect tax) of government creates a tax rate required to support a particular size and scope of government. That the tax rate to support a particular size and scope of government can pass through taxation equilibrium when government is too large given the underlying private sector.
Once you pass through taxation equilibrium, an economic effect occurs, rather than a mathematical effect, where tax revenue decreases at an increasing rate.
It can be easily argued that we have reached a point past taxation equilibrium given your point about total government consumption in relation to GDP.
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