I'm just astounded that people think the US can keep going down the Reaganomics/Bushonomics supply-side road. Clinton had the top rate at 39% and we had a surplus. Now it's at 35% and there's an $800 billion deficit.
And I'm astounded that people drink the partisan Kool-Aid and believe it's as simple as who -- and what party -- is in the White House.
First, the problems are related to *spending*, not revenue. I believe supply siders are somewhat vindicated in that the preponderance of the evidence shows that tax cuts do rev up the economy, and create more taxable economic activity which can, in fact, increase revenue.
The problem is that SPENDING is out of control.
Secondly, to some degree economics are cyclical, and tax policy influences behavior. Clinton benefited from a strong economy and a rising dot-com bubble that generated unbelievable (and unsustainable) amounts of capital gains revenue. That was a fortunate accident, IMO -- not at all related to a president's tax policy. Also, a lot of taxes were paid in 1998 to 2000 from previously more generous Roth conversion rules. Again, this was an unsustainable source of revenue.
So as satisfying as it may be for some to make it political, and to associate surpluses and deficits with particular political parties and particular tax policies, I don't see it that simplistically. The bottom line is that budget deficits and surpluses are a function of revenue
and spending, and the tendency is for too many people to ignore the spending side, which (IMO) is where the problem is. We tend to focus on tinkering with the revenue side even as we ignore the expenditures side as it barrels out of control.
My personal belief is that tax rates should be left alone for a long time, whether they are slightly "too high" or "too low" according to the Laffer Curve or other perceived 'optimal' target. I think the economic cost in individuals and businesses making suboptimal economic decisions for tax reasons -- and not making long-term investment decisions for fear of future tax law changes hurting them -- far exceeds a delta in revenue by tweaking the rates. I believe you'd see a lot of economic activity develop just by making it clear that the decisions we make about our finances *today* won't screw us in 5-10 years because of tax law changes.
It is *spending* policy, not *taxing* policy, which is in greater need of discussion and reform.