One of the favorite replies of interventionists, when asked why a particular government program doesn't seem to work, is that the program in question "has never really been tried". Not enough money was spent, the implementation was too short, the wrong people ran it, etc.
Now I get to use that line about one of the bigger policy controversies of the last quarter-century: tax cuts. The other side cites all kinds of data to allege that tax cuts "don't work". Well, they haven't really been tried. Distinguished economists Christina and David Romer find:
Tax cuts led, eventually, to tax increases. Basically, something has to give; there is a government budget constraint. What we thought gave when you cut taxes was spending, but we seem to find that in postwar U.S. history what actually gives is the tax cut itself. A substantial fraction of a tax cut is typically undone in the subsequent five years.
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