The book I just finished discussed economics as both the golden child of the social sciences and its least successful, because it doesn't sufficiently factor in the psychology of spending and what people are liable to do. And he's right in that economists really do suck. Their power and reputation comes from being the only game in town, otherwise, they wouldn't be so constantly wrong and easily beat by any stock market junkie with a scrap of blind intuition.

It's always seemed to me that Reaganomics would work better if you gave rich people a different incentive to spend. Like...a huge tax on wealth being distributed to your children upon death. Would it ever happen? No. But lowering taxes for them isn't quite going to make them spend more on their jet. Where it concerns the government making more because they don't try as hard to find loopholes...is there any data on that? It makes sense, but at the same time I fail to see why the rich would suddenly stop paying their accountants to find loopholes anyway. That strikes me as where the slip of reason comes in. It's not the job of the wealthy man to find those loopholes, and he's never going to think the paycheck of X accountants can be better saved than spent letting them save him even more.

Well, it is true that the disparity between the richest and poorest got a little out of control under Reagan...and is getting worse again under Bush. But Satyr is correct, the intent of Reaganomics was to INCREASE tax revenues by decreasing taxes, thus increasing productivity. Within that limited scope, it may have been effective. Even adjusting for inflation, tax revenues actually did increase in the Reagan era. Although part of that is because he actually RAISED payroll taxes (medicare and social security, which are only payed by lower and middle class taxpayers. Tax code is fascinating, it really is).

There is in fact an estate tax. In other words, you must pay a certain percentage of your estate to the government when you die. Naturally, conservatives are trying to eliminate it. At the moment, it only applies to estates exceeding $2 million at the federal level, and people are indeed inventive about finding ways around it. You could even argue that Warren Buffet figured out a way to not pay taxes on most of it, by giving it away.

The success of such a scheme, like most economic policies, lies in finding the right balance. It's true that paying more taxes makes people less ambitious, but as long as government is necessary, it must be funded somehow. My complaint about the conservative political agenda has to do with who is doing the paying more than anything else. And it is also worth noting that Reagan more than tripled the debt the US owes...he ballooned our military budget into the bloated monster it is today.