Why Government Is the Problem | Hoover Institution

The more taxes the more the deadweight loss in the economy.

Deadweight loss is the amount of reduction of benefits to suppliers and consumers above the amount collected in taxes.

Before tax suppliers get $10 benefit, consumers get $10 benefit, and government gets $0 tax revenue.

After tax suppliers get $7 benefit, consumers get $7 benefit, and government gets $2 tax revenue, with $4 deadweight loss.

Increased benefits to suppliers = more and higher paying jobs.

Increased benefits to consumers = lower prices

When in doubt Republicans want smaller government with lower taxes and less deadweight loss.

When in doubt Democrats want bigger government with higher taxes and more deadweight loss.

Since this is common knowledge must be much enjoyment of sadism and masochism going on.

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