This is the Cato Daily Podcast for Thursday, October 10th,

2024.

I'm Caleb Brown.

You're being lied to about taxes by both Republicans and Democrats.

The stakes couldn't be higher.

If Americans were forced to pay for massive federal spending up front

instead of through trillions of dollars in new debt,

it would easily claim half of most Americans paychecks.

Cato's Adam Michelle explains in a new Cato paper.

I want to go through a couple of misleading statements, but, and one that I hear on the right a lot is this tax cut will pay for itself.

Or tax cuts don't have to be paid for. Who makes that argument?

Republicans tend to make this argument and I think their heart is in the

right place that American people's money is theirs and not the

governments by default, but they leave out the side of the equation of what the money is funding.

The spending is often not part of the discussion.

That when you keep taxes low, you also need to keep spending low.

Because if there's a big gap between what you bring in and what's going out the door,

persistently something has to give. We can't keep continuing to accumulate large debt and growing deficits indefinitely.

Talk about how that, how is that misleading though?

Because I hear, oh look, well we're on this side of the Laffer curve meaning that if we reduce rates

revenues will go up and that and that may well be true. The Laffer curve is helpful in as a will be

helpful in, to think about how much damage a tax is causing,

...