orb@whuxl.UUCP (SEVENER) (11/14/85)
Earlier I pointed out that Dave Olson's citation of increased
overall revenues from 1981 to 1982 as support for supply-side
theory was another typical confusion of categories.
I pointed out that the New York Times article pointing out
the *decline* in revenues after the 81 tax cuts involved
only those revenues from income taxes which were cut - not
revenues from all sources. I also argued that the increase
in *overall* revenues cited by Dave Olson was undoubtedly
due to Social Security tax increases. The figures posted
by Jeff Myers on Social Security receipts and outlays supports
my presumption.
Here is a table of the relevant stats:
REVENUE 1981 1982 CHANGE
income tax $284.1 $276.9 - 7.2
social security 182.7 201.5 +18.8
overall 663.9 690.4 +26.5
As we can see Social Security *does* account for the major
portion of the revenue increase from 1981 to 1982. There are
other categories which must contribute to the increase in revenues
such as tariffs, user fees, and so forth. But regardless
for the category of taxes *cut*, namely income taxes, revenues
*decreased*. For those taxes *increased*, namely Social Security,
revenues *increased*.
Moreover, even if income tax revenues had increased this would
hardly prove that it was due to the '81 tax cuts. One would
instead have to compare *what would have been collected* without
the tax cuts with actual revenues with the tax cuts.
All indications from previous years' income tax revenues are that
*more* income tax revenues would have been collected without
the 1981 tax cuts. At least that is what is claimed by
knowledgeable Congresspersons of *both* parties.
tim sevener whuxn!orb