Saturday, October 13, 2007

Non-fiction "The Big Con"

This is a political book written by Jonthan Chait, a writer for the New Republic. In the book he tries to explain how certain economical theories became to dominate the public policies (especially of the Republic party), even though they are considered wrong.

The principal idea he criticizes is "supply-side" economics and the now famous Laffer Curve. The premise is that reducing taxes will actually result in more revenues for the goverment. Since supply side economics was first
applied under President Regan, historically the principal appears to be incorrect. Deficits rose during the Regan era, and went down during the Clintor ear when taxes were raised.

Supply side economics benefits mostly very rich people, especially those who get most of their money as investment income. The puzzle then is why do regular working class people keep voting for Republicans (or were until 2006), even though this is not in their economic interest.

The author's main theses that the people in power simply con the voters, by obfuscating the actual issues (eg. "death tax") and distracting them with social issues that have no economic impact.

This was an interesting book to read - sort of a companion to "What's the Matter With Kansas?" (although I haven't read that book).


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