[SeeGeeWhy]

From John Maudlin's Outside the box newsletter (july 13, 2009):

"The most extensive research on tax multipliers is found in a paper written at the University of California Berkeley entitled The Macroeconomic Effects of Tax Changes: Estimates Based on a new Measure of Fiscal Shocks, by Christina D. and David H. Romer (March 2007). (Christina Romer now chairs the [US] president's Council of Economic Advisors). This study found that the tax multiplier is 3, meaning that each dollar rise in taxes will reduce private spending by $3."

Tax is bad for business, which in my view is bad for society. Business is the way that we directly improve "our' quality of life, which drives our ability to agree to social contracts and live a peaceful, healthy and law abiding existence. To wound business is to wound ourselves. Thus, I agree that tax is bad.

HOWEVER, as we are constantly learning, people can't be trusted to be self regulating... even in a free market economy. You need some taxes to help regulate behaviour and keep things at an even keel. The human element will forever prevent mankind from implementing a perfect socio-economic system.