Revenue effect unclear
The point made in the parent node to this refutes the employment gains plan claimed by Diamond on the ground that the labor supply response could be extensive (more workers) or intensive (more hours). However this may not change the added revenue arising - and hence the affordability of the plan.
This point underscores the importance of being clear on what we are arguing about. Romney has claimed, based on the Diamond study, that his tax reform plan will add 6.8 million workers. However this is separate from the argument about whether the added revenue from growth claimed for his plan will be sufficient to fund all its objectives.
Immediately related elementsHow this works
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Visualizing the Romney Tax Debate »Visualizing the Romney Tax Debate
Romney's plan stated »Romney's plan stated
But does it compute? »But does it compute?
No - it does not compute »No - it does not compute
The TPC case »The TPC case
Growth effect claim »Growth effect claim
Ignores growth potential »Ignores growth potential
Growth-supportive studies »Growth-supportive studies
1. Rosen »1. Rosen
Growth estimate 1 - Diamond study »Growth estimate 1 - Diamond study
Labor force analysis »Labor force analysis
Conflicting assumptions »Conflicting assumptions
Revenue effect unclear
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