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--></style></head><body lang=EN-US link=blue vlink=purple style='word-wrap:break-word'><div class=WordSection1><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'><o:p> </o:p></span></p><p class=MsoNormal><b><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>From:</span></b><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'> John Clark <johnkclark@gmail.com> <br><br></span></p><div><div><div><p class=MsoNormal><span style='font-family:"Arial",sans-serif'>On Fri, Oct 10, 2025 at 6:35 PM <<a href="mailto:spike@rainier66.com" target="_blank">spike@rainier66.com</a>> wrote:<o:p></o:p></span></p></div></div><div><div><div><p class=MsoNormal><o:p> </o:p></p></div><blockquote style='border:none;border-left:solid #CCCCCC 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in'><p class=MsoNormal><span class=gmaildefault><i><span style='font-size:13.5pt;font-family:"Arial",sans-serif'>> </span></i></span><i><span style='font-size:13.5pt;font-family:"Georgia",serif'>Before I go on, is there anything above you wish to dispute?</span></i><o:p></o:p></p></blockquote><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Yeah, a couple.<span class=gmaildefault> </span> </span></b><o:p></o:p></p></div><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'> </span> <o:p></o:p></p><blockquote style='border:none;border-left:solid #CCCCCC 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in'><div><div><blockquote style='border:none;border-left:solid #CCCCCC 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in'><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>>…Laffer theory? All Laffer said is that to maximize the amount of money the federal government receives <u>the tax rate should not be too high or too low,</u> and to illustrate that point he drew a curve on a blackboard that is called by some the "Laffer curve" but that I call a keen grasp of the obvious…<o:p></o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Ja. So obvious, most politicians still do not understand it or refuse to accept it. They are the students in this class when Ferris Bueller was absent that day.<o:p></o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>The movie was made in 1986. It was a gag, about how Bueller was the only student who followed the professor. The rest of them were catatonic with boredom. But that guy who played the role is an actual literal economist, and ad-libbed that scene. Take the minute 15 seconds, listen to what he says:<o:p></o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><a href="https://www.youtube.com/watch?v=uhiCFdWeQfA">https://www.youtube.com/watch?v=uhiCFdWeQfA</a><o:p></o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p></blockquote></div></div></blockquote><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>>… <span class=gmaildefault>The </span>Reagan<span class=gmaildefault> tax cuts affected the very rich far more than the very poor, overall he cut </span>income tax rates by about 25% over three years<span class=gmaildefault>, mainly by </span>reduc<span class=gmaildefault>ing</span> the top <span class=gmaildefault>tax</span> rate by <u>a lot</u>,<span class=gmaildefault> </span>from 70% to <span class=gmaildefault>28</span>%<span class=gmaildefault>. It was called trickle down economics…<o:p></o:p></span></span></b></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Sure was. It incentivized the people with money to invest it rather than sit on it. That worked. It poured capital back into the economy. Result: the 1980s were prosperous, the government took in more revenue than before.<o:p></o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>>…</span></b></span><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Arial",sans-serif'> </span></b></span><b><u><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>The debt as a percentage of GDP</span></u></b><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'> also </span></b></span><b><u><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>increased significantly during the Reagan years</span></u></b><span class=gmaildefault><b><u><span style='font-size:13.5pt;font-family:"Arial",sans-serif'>,</span></u></b></span><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Arial",sans-serif'> it </span></b></span><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>increased from 26.2% in 1980 to 40.9% in 1988…<span class=gmaildefault> John K Clark</span></span></b><o:p></o:p></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Right again.<span class=gmaildefault> Government spent way beyond its revenue, even though the revenue went up. Spending went up more.</span><o:p></o:p></span></b></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><blockquote style='border:none;border-left:solid #CCCCCC 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in'><p class=MsoNormal><span class=gmaildefault><i><span style='font-size:13.5pt;font-family:"Arial",sans-serif'>> </span></i></span><i><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>I don’t see why interest on the current debt is placed under discretionary spending, but that is how economists treat it.</span></i><o:p></o:p></p></blockquote><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>>…Spike, do you really think th<span class=gmaildefault>e US should just renege on paying the national debt and turn US savings bonds into junk bonds overnight?!<o:p></o:p></span></span></b></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>No, not at all, just the opposite. I am suggesting that the funds being paid into Social Security to pay back the borrowing from that fund in the 1990s be treated as mandatory spending rather than discretionary. <o:p></o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Currently we (well, not WE, but rather some people) think of mandatory spending as Social Security and Medicare only, which are entitlements, so those must be paid. But the money the fed is now borrowing to pay back the mandatory funds is called discretionary spending. In my view that should be considered mandatory spending, because the fed must pay back its debt, which it incurred using an accounting trick from 1994, which allowed it to consider what was mandatory spending as discretionary to start with. Naysayers at the time (such as me) realized this would create the illusion that the government wasn’t really overspending its revenue, which it very clearly was, and did. Now… we pay.<o:p></o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Well OK then, undo that accounting trick from 30 years ago. Make it clear that we now have only two classes of discretionary spending rather than three. The two remaining classes of discretionary spending are military and not-military (everything that federal government does.) Treat the interest payments (AND THE ADDITIONAL FUNDS WHICH MUST BE BORROWED! (that part is damn important)) along with the future interest payments on the funds which must be borrowed as mandatory spending. <o:p></o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Now that we have it all down to terms voters can understand, just two categories, military and not-military, they will see that what Elon Musk and his DOGErs were saying was absolutely right. But… they were despised and ignored.<o:p></o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>Elon was right. The consequences of ignoring DOGE will be most painful.<o:p></o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'><o:p> </o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'>spike<o:p></o:p></span></b></span></p><p class=MsoNormal><span class=gmaildefault><b><span style='font-size:13.5pt;font-family:"Tahoma",sans-serif'> </span></b></span><o:p></o:p></p></div><div><blockquote style='border:none;border-left:solid #CCCCCC 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in'><div><div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><o:p> </o:p></p></div></div></div></blockquote></div></div></div></div></body></html>