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I previously profiled the efforts of Senator Mike Lee (R-Utah) and some high-profile intellectual allies to change the goals of conservative tax policy. For decades, the key GOP idea on taxes has been the supply-side notion that we need to slash marginal tax rates on the highest-income individuals, thus unleashing a torrent of economic growth that makes everyone better off. Lee's idea is to instead simply cut taxes on middle-class families, even if that means the rich have to pay more.
This is a crucially important fight that, were Lee to win it, would alter the political and ideological landscape in key ways.
But (via Jonathan Chait) a recent Paul Ryan interview with the Weekly Standard's John McCormack shows that the congressional GOP's intellectual leader is still firmly on Team Supply Side:
"I'm a classic growth conservative. I believe that the best way to help families, the best way to help the economy is to reduce rates across the board," Ryan said when asked about Utah senator Mike Lee's plan to increase the child tax credit and create two income tax brackets of 15 percent and 35 percent. "Growth occurs on the margin, which is a wonky way of saying, if you want faster economic growth, more upward mobility, and faster job creation, lower tax rates across the board is the key-it's the secret sauce.
"Some conservatives have argued that reducing the top rate is less urgent now than it was during the Reagan administration, when the top rate was cut from 70 percent to 50 percent and then cut again from 50 percent to 28 percent. But Ryan says that cutting the top rate is "even more pressing now" than it was back then "because the American economy was so dominant in the global economy and capital was not nearly as mobile as it is today."
The idea that globalization, which tends to increase the overall size of the economy while also increasing inequality, makes tax cuts for the rich even more urgent strikes me as a little bit hard to defend intellectually. But it's good to see conservative journalists asking these questions of conservative politicians, since even though it's off the headlines this is probably the most important policy debate happening today.
