Wednesday, March 16, 2011

Confucius explains the Laffer Curve.

"Duke Ai ask Yu Juo, 'The harvest is bad, and I have not sufficient to cover expenditure. What should I do?'

Yu Juo answered, 'What about taxing the people one part in ten?'

'I do not have sufficient as it is when I tax them two parts in ten. How could I possibly tax them one part in ten?'

'When the people have sufficient, who is there to share your insufficiency? When the people have insufficient, who is there to share your sufficiency?'" - Analects, XII.9

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