Will we learn from or repeat history?
The hero of Waterloo was the Duke of Wellington, but the hero of the peace that followed was a Whig member of Parliament, Henry Brougham, who led the charge in 1815 for abolition of the income tax. Don’t do it, said the conventionally wise; we have a 915-million-pound debt to pay off.
But Brougham (say “Broom”) and his allies did it anyway. Business got its stimulus, and the tax revenues poured in, reducing the debt considerably and starting a 60-year bull market for the empire. It’s “the way the world works,” as in the title of Jude Wanniski’s 1978 book. (Berwyn library has it, FYI.)
You don’t always generate more tax revenues with higher tax rates. If you think you do, Wanniski has an extended economic and historical argument to help you get over it, including chapter and verse on this British case.
There’s more on the low-tax-high-prosperity theme at my column for the month at Wednesday Journal of Oak Park & River Forest