Vodou economics is the theory that, if you lower taxes on the rich, government revenues will increase and budgets will be balanced. It is a zombie that Trump and the Republican Congress have brought back to life. The theory first raised its ridiculous head in the Reagan administration. Remember the Laffer Curve that seemed to prove the theory? Most people laughed at the Laffer Curve, but the joke is going to be on us if Trump and the Republican Congress have their way. The theoretical assumption of Vodou economics is that wealthy people and businesses will invest the money they keep from less taxes in ways that will create jobs. More income earners, more tax revenue.
There is abundant evidence that it does not work. Reagan tried it. He cut taxes and ended up with a huge national debt. George W. Bush cut taxes and we ended up with the Great Recession in 2008. On the other hand, one of the first things Bill Clinton did was to raise taxes and the 90's were boom years. He ended his administration with surplus budgets.
If the wealthy have more to spend from their tax cuts, all evidence shows that it will not go to creating jobs; it will go to make them even more wealthy. A Congressional Research Service report says that "The reduction in the top rates appears to be uncorrelated with saving, investment and productivity growth." A survey conducted by an international accounting firm found that only 23% of business leaders replied they would invest the windfall gains from tax cuts on growth, more jobs or higher wages. Most said that the saving would go to investors through higher dividends and stock buybacks. Furthermore, iIf a wealthy person was looking for a company to invest in, they would probably look for the most profitable. The most profitable are the ones that have saved on labor costs by shipping jobs overseas.
If Trump and the Republican Congress are able to enact these tax cuts, the national debt will become even more mountainous. Interest payments on this debt will become a major part of the budget, taking funds away from the essentials that make America great. This debt will be with us long after Trump leaves office, just as it remained with us after Reagan left.
Many Americans made a great effort to kept Republican health care plans from being enacted. An equal effort will need to be made to defeat this tax cut. Democratic party leaders must educate the public and send talking points to TV commentators. I hope some of the point I have mentioned in this post will help.
For an excellent report on this issue see http://reclaimtheamericandream.org/2017/09/inside-tax-cut-job-growth-myth/