Sorry - but I think you are whistling in the wind.

First of all the OECD data does not prove that tax cuts are linked to growth. Statistically it says this case is not proven. It does not say tax increases increase growth, I agree - but not the reverse. So that’s one of your arguments down.

Second, the increase in US tax revenues you refer to has nothing to do wih tax cust but everything to do with the tax amnesty allowing US corproations to repatriate profits at low tax rates for a year - so please don’t abuse the evidence.

Third - the Treasury is more dynamic than you’re giving them credit for - so I don’t buy your argument.

Fourth, self interest is the absolute core of the politics the TPA, Adam Smith Institute, IEA and other such UK neo-con bodies espouse. In fact, not only is it the key assumption, it is assumed irrational to consider anyone else (which is based on the wholly false interpretation of Adam Smith’s ‘invisible hand’ that the Right likes to use - in itself a crazy logic when Smith used the phrase just once in a book well over 400 pages long and had no intention that it should be the key feature of the work). So of course I accuse the TPA of complete self interest. To say anything else would be quite straightforwardly wrong.

That and the fact that there’s no evidence to suppot their claim, but they pursue it anyway saying they must put their own interest before that of all others - as I convincingly prove to be the acse in my work on flat tax for the ACCA.

So, please debate - but can you get your facts right first?

Interesting blog, that I’ve only just discovered.

But on dynamic tax modelling, I think you’re wrong about HMT’s approach. Although Brown made all those statements about post neoclassical endogenous growth theory, they take no account of it in their forecasting.

In fact they follow the traditional HMT approach which is to assume long-run growth is a given- ie exogenous.

What the TPA is saying is not that everything else should be ignored, but that it’s about time HMT paid some real attention to all the work from the last ten years (including from the OECD, see TPA site for references) which shows a clear link between tax and long-run growth rates.

Incidentally, there’s an interesting post on the TPA today drawing attention to the spectacular growth in US tax revenues following Bush’s tax cuts. Laffer ain’t in it.

PS What’s this “self-interested talk” stuff? I’ve met the guys from the TPA, and I can assure you they are not offshore plutocrats- they just happen to believe that lower taxes and smaller government would be good for everyone. The many not the few etc. A different view to yours yes, but you can’t just write it off as self-interest.