Quotes from Arthur Laffer

It has always amazed me how tax cuts don't work until they take effect. Mr. Obama's experience with deferred tax rate increases will be the reverse. The economy will collapse in 2011.

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.

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.

I'm worried about economic growth in the United States. And the creation of jobs, output, and employment. And if you tax people who work, you're going to get less people working. And what the carbon tax would do is remove the tax from people who work and put it on a product in the ground.

I mean, everyone agrees with stress tests for banks. I mean that's clear. But banks should do that on their own. And they should worry about their own capital functioning. That's what they should do. It shouldn't be a government function.

We are having the single worst recovery the U.S. has had since the Great Depression. I don't care how you measure it. The East Coast knows it. The West Coast knows it. North, South, old, young, everyone knows it's the worst recovery since the Great Depression.

A carbon tax by itself would make driving more expensive, that's very true. But in exchange for that, there are going to be more jobs, more output, more employment, and more products available. So really, as long as you're going to collect the revenues you're going to collect, you're going to have to trade off one tax for the other.

The trade deficit is the capital surplus and don't ever think of having a capital surplus as being a bad thing for our country.

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.

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.

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.

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.

The Laffer Curve, by the way, was not invented by me.

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

The income effects in an economy always sum to zero.

Sound money is the sine qua non of a prosperous society.

And just remember, every dollar we spend on outsourcing is spent on U.S. goods or invested back in the U.S. market. That's accounting.

I feel very uncomfortable with respect to looking at inflation.

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.

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.

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?

Obama is a fine, very impressive person. He really is. Unfortunately, everything that he is doing in economics is exactly wrong. He is a crappy president.

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

Raising taxes is not a frivolous venture that you do on the editorial page of 'The New Republic,' for god sakes. It's something that you really have to think about and go through carefully.