[Professor S]

When it comes to economics, there are essentially three things that we know from time and experience:

1) Cutting taxes (income and capital gains) helps the economy grow on a macro level. This is not debateable, it is in reality proven fact.

2) Cutting taxes raises revenue through the growth in the economy (lower rates, but more to tax), but cannot raise enough revenue to pay for the cuts without spending cuts as well.

3) Punitive tax rates hurt business, but due to tax shelters based on trusts and corporations, they do more harm than good when it comes to revenue. The money that is intended to be taxed, isn't, but at the same time the money is not in the economy either.

So in the end, I think its safe to assume that low taxes and low spending is the bast way to help the economy. But the argument against it is that the poor and disenfranchised will suffer due to the decreased number of social services, but I believe that over time that would dissappear.

An excellent example of how eliminating unethical taxation has helped a nation increase its wealth and helped eliminate poverty is Bermuda. Bermuda does not tax its own people. There is no income tax, there is no real estate tax, there is no transfer tax, there is no estate/death tax and so on and so forth.

It is also one of the richest nations, per capita, in the world, and has next next to no poverty. But whats counter-intuitive is that less than 20% of their economy is based in tourism. Bermuda's attractive tax rates to businesses, attractive meaning NONE, has brought huge insurance and re-insurance corporation to their shores. There is a bank on almost every street corner. Their low income housing starts in the low $700,000's.

Now is everyone rich? No, but that is where the elimination of estate and transfer taxes comes in. Lower income Bermudan's can inherit homes without the worry that they cannot pay the taxes on the inheritance. The wealth stays in the family and ferry boat captains can live in the types of homes that celebrities own because of this.

Where does Bermuda make its money? Not on taxes, but instead on import and export tariffs. This makes things more expensive in Bermuda, but everyone there has accumulated so much wealth that the increased cost doesn;t affect them that much. I will tell you that paying $25 for a steak and kidney pie affected me, though. Ouch!

Bermuda could have easily fallen into the same trap as any of the other resort destination sprinkled around the US and gulf coasts, having fenced in "Haves" surrounded and served by the "Have Nots". Instead it went in a less conevntional direction, and their people have benefitted from it immensely.

Is Bermuda a perfect example of supply side being the obvious choice? Of course not, but there is no perfect example. No country or culture is the same, and there will always be extenuating circumstances if we look for them. But in the big picture I am convinced supply side is the most effective way to gain revenue while not punishing your own people's success. And quite honestly, the aletrnative has never proven to be anything but disasterous.