Arthur Laffer

“The linkage between tax rates and public services is, if not non-existent, negative.”

“I think the inflation prospects for the U.S. over the next five or six, seven years, are quite serious. You cannot have a bumper crop in apples without the value or the price of each apple falling. The Fed has had the largest increase in the monetary base in the history of the U.S., from colonial times to the present, times ten.”

“Let me just try to give you sort of the intuitive one here on the stimulus funds. If you have a two-person economy - let's imagine we have two farms, and that's the whole world, just two farms. If one of those farmers gets unemployment benefits, who do you think pays for him? Am I going way over your heads today?”

“You know, without China there is no Wal-Mart and without Wal-Mart there is no middle class and lower class prosperity in the United States.”

“The truth of the matter of is that stimulus money not only doesn't stimulate; it actually reduces output.”

“People can change the volume, the location and the composition of their income, and they can do so in response to changes in government policies.”

“Sometimes, tax rate increases create the very problems that the spending is intended to cure. In other words, the tax rate increases reduce economic growth; they shrink the pie; they cause more poverty, more despair, more unemployment, which are all things government is trying to alleviate with spending.”

“I used the so-called Laffer Curve all the time in my classes and with anyone else who would listen to me to illustrate the trade-off between tax rates and tax revenues.”

“Which would you rather have, capital lined up on your borders, trying to get into your country or trying to get out of your country? We are the capital magnet of this planet and we are the savior for not only people, for not only freedom, but also for capital.”

“My godfather was a man named Justin Dart. Some of you may remember Justin Dart. My younger son's name is Justin, named after Justin Dart. I was executor of his estate, and he was my godfather. I first really got time to spend with Ronald Reagan with Justin Dart personally, one-on-one.”

“The income effects in an economy always sum to zero.”

“People can also change the timing of when they earn and receive their income in response to government policies.”

“What we're talking about is the price of goods, all goods, in terms of money. That has nothing to do with unemployment, except for the fact that you get fewer goods. And when you have more money and fewer goods, the amount of dollars per good goes up. It goes up because there are fewer goods and it goes up because there is more money.”

“Taxes are not trivial - they're a huge portion of this overall economy. And that's why I focused on them.”

“What I'm not saying is that all government spending is bad. It's not - far, far from it, but there is no free lunch, as a former colleague of mine used to say. There is no public tooth fairy. Father Christmas does not work on the Treasury staff this year. You can never bail someone out of trouble without putting someone else into trouble.”

“Over the past 100 years, there have been three major periods of tax-rate cuts in the U.S.: the Harding-Coolidge cuts of the mid-1920s; the Kennedy cuts of the mid-1960s; and the Reagan cuts of the early 1980s. Each of these periods of tax cuts was remarkably successful as measured by virtually any public policy metric.”

“When you look at the world, everyone in the world who cares about his or her family wants to have a major portion of their assets in the United States because we are the growth country and the freedom loving country.”

“And let the Fed sell bonds to bring bank reserves back down to required reserve levels, so we have restraint on bank lending and bank issuances of liability.”

“California is the highest-tax state in the nation and has been for a long time. It has the highest-paid teachers in the nation, by far - $400 a month more than New Jersey - and yet California is the third lowest state on test scores for fourth and eighth grade English and math in the nation, and has been at the low level for a long, long time.”

“When you look at the government, when the government collects a buck, it's not free. They have to spend resources, the IRS, audits, all this sort of crap, to collect the dollar. I'm not assuming any Laffer curve effect here at all. There are just transactions costs of collecting that money.”