Macro-economic wonkery is Fester's purview and frankly I don't understand the mathematics of the WSJ's Laffer Curve theory, but I'm finding the widespread mockery of their model most amusing. I especially liked Hilzoy's post.
I don't really get the joke. For a mathophobe like myself, this was the key graf that evoked my sardonic laughter.
Lower corporate tax rates with fewer loopholes can lead to more, not less, tax revenue from business. The nearby chart shows the Laffer Curve effect from business taxation. Tax receipts tend to fall below their optimum potential when corporate tax rates are so high that they lead to the creation of loopholes and the incentive to move income to countries with a lower tax rate.
I may not be good at crunching numbers but even I can see the rotten spots in that argument. Tax rates don't cause loopholes, politicians do. You could tax corporations at 5% and they still would offshore whatever they can to avoid paying taxes and labor costs. Their ill-advised personhood status nothwithstanding, corporations don't care about God or country. They care about profits. Period.
Lowering the tax rate isn't going to change that.