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Tax cuts for the wealthy only benefit the rich | LSE Research

#lse#rich#taxes#hope#cuts#paper
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History suggests that policies relying on “trickle-down economics” are destined to fail, and yet the idea, for some, still persists. David Hope explains why tax cuts for top earners only benefit the rich and why the issue is so controversial to discuss. When then UK Prime Minister Liz Truss and Treasurer Kwasi Kwarteng sparked economic turmoil by announcing unfunded tax cuts for top earners to boost economic growth, it created one of the most extraordinary political crises in UK history. Their "mini budget" spooked the markets and was widely condemned for appearing to rely on the discredited theory of "trickle-down economics". But it’s an idea that has persisted: the last 50 years has seen a dramatic decline in taxes on the rich across advanced democracies. Margaret Thatcher, Ronald Reagan and Donald Trump were all elected on promises of major tax cuts for top earners, arguing that freeing up money for the wealthy allows them to hire more workers, pay better wages and invest more.…

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