Economist Arthur Laffer discusses U.S. economy
Economist and consultant Arthur Laffer visited PLU to offer his view on the current climate of recession, deficits and tax stimulus packages.
Known as “the father of supply-side economics,” Laffer was a member of President Reagan’s Economic Policy Advisory Board. In that position, he helped guide U.S. economic policy in the 1980s. He proposed that reductions in federal taxes on businesses and individuals would lead to increased economic growth and, in the long run, to increased government revenue.
He is best known for the “Laffer Curve,” which illustrates the economic relationship of tax revenue dropping when rates get too high and tax collections increasing as tax rates are cut.
A controversial figure, Laffer is the embodiment of John Maynard Keynes’ observation that, “The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood.”
Laffer is the founder and chairman of Laffer Associates, an economic research and consulting firm that provides investment-research services to institutional asset managers. Since its inception in 1979, the firm’s research has focused on the interconnecting macroeconomic, political and demographic changes affecting global financial markets.
One of his earliest successes in shaping public policy was his involvement in Proposition 13, the groundbreaking California initiative that drastically cut property taxes in the state in 1978.
Laffer has been widely acknowledged for his economic achievements. He was noted in Time Magazine’s March 29, 1999, cover story “The Century’s Greatest Minds” for inventing the Laffer Curve. It was deemed as one of “a few of the advances that powered this extraordinary century.”