Of course this is the golden excuse republicans give for cutting taxes. They throw a bone or two to the middle and lower classes and then they hack at corporate, capital gains, dividend and estate taxes for all they're worth. Recently John McCain tried to perpetuate the myth that by cutting taxes, the government gains revenue because the economy expands and the private sector ends up paying more in taxes as a whole. This is the foundation of Bush's reasoning behind wanting to make his 2001 and 2003 tax cuts permanent.
The truth is, of course, not mentioned by McCain nor by Bush administration officials. Here's a dose of reality courtesy of Factcheck.org:
In fact, the last half-dozen years have shown us that we can't have both lower taxes and fatter government coffers. The Congressional Budget Office, the Treasury Department, the Joint Committee on Taxation, the White House’s Council of Economic Advisers and a former Bush administration economist all say that tax cuts lead to revenues that are lower than they otherwise would have been – even if they spur some economic growth. (Robertson, 6-11-2007)
The full story with analysis and sources can be found here: http://www.factcheck.org/taxes/supply-side_spin.html
You would have thought that McCain would have known better, and at one time he did as he voted against the 2003 tax cuts. He has become such a toady for the right wing now that he now feels he must genuflect before the altar of supply side dogma.
Next time you hear that "tax cuts = revenues" nonsense just think about that wonderful supply side catch phrase from the Eighties - "Trickle down eoconomics" and remember just who it was that got trickled on then and who it is that is getting trickled on now.
Thanks for reading.