I found the link to Roll Back the Reagan Tax Cuts on the Facebook page of my friend MardyS.

Consider all the “tax cuts” working people have gotten over the past 30 years, from Reagan, Clinton, and Bush Jr. In each case, within a year or two working people’s wages were the same or lower. On the other hand, when working-class people’s taxes went up, during the Truman, Eisenhower, Johnson, and Nixon administrations, their wages went up in the following years, too.

We’ve seen both happen over the past 80 years, over and over again.

Interesting premise.  You have to read the article for the explanation of why this is. The article was so long, that I haven’t read it all. I have read more than enough to understand the quote that I have highlighted above.

I think it was Nassim Nicholas Taleb who pointed out that it is one thing to note some historical behavior, but quite another to postulate that you know the reason why it happened. The first can be a pretty safe thing to do. The second is fraught with the danger of fooling yourself. I can think of a few other explanations for the change in wages with respect to taxes than the author of the article comes up with. Normally taxes are cut when the economy is struggling and wages are falling.  Taxes are raised when the economy is booming and wages are rising.  If you take a snapshot of wages when the tax policy is changed and then look again at wages two years later, then you will see the results described in Roll Back the Reagan Tax Cuts. However, given my scenario, the cause and effect is the exact reverse of what Thom Hartmann describes.

Also refer to RichardH’s blog post Diversion–Highway Fatalities and Lemons.

Despite its possible flaws, the Roll Back the Reagan Tax Cuts article makes a nice complement to my post A Way Out Of Economic Mess.  That is, if you can believe other things in the article despite the flaw in one of his major arguments.