Sadly, Rudy Giuliani is following John McCain down the supply side rabbit hole.
Last week, as Matthew Yglesias notes, Giuliani told supply-side guru Larry Kudlow that tax cuts increase revenue:
KUDLOW: "I want to ask you, do you regard yourself as a free market capitalist? Do you regard yourself as a supply-sider?"
GIULIANI: "I regard myself as a supply-sider for sure. I mean, watched Ronald Reagan do it and learned it, saw it work. Taxes get reduced, more revenue come in.
And McCain drank the tax-cuts-increase-revenue Kool-Aid a few weeks earlier in an interview with National Review's Ramesh Ponnuru (via Jon Chait):
Ponnuru: "If you could get the Democrats to agree, or at least to come to the table on entitlements or on tax simplification, are those circumstances under which you’d be willing to accept a tax increase?"
McCain: "No; no."
Ponnuru: "No circumstances?"
McCain: "No. None. None. Tax cuts, starting with Kennedy, as we all know, increase revenues. So what’s the argument for increasing taxes? If you get the opposite effect out of tax cuts?"
Giuliani and McCain thus join Bob Dole and George H.W. Bush in the pantheon of formerly sensible Republicans who were forcibly converted to supply-side dogmatism. Will anyone ask them why so many current and former Bush administration economists keep pointing out that tax cuts don't actually increase revenue?
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