Did Feldstein believe tax cuts always stimulate growth?
While I recognized that well-designed tax reforms could enhance economic efficiency and potentially boost growth by improving incentives, I was not an unqualified proponent of all tax cuts. My research indicated that the magnitude and incidence of such cuts matter greatly. If tax cuts lead to unsustainable budget deficits, they can drive up interest rates, crowd out private investment, and ultimately hinder long-term growth. The focus must always be on the net effect, considering both the immediate impact and the fiscal consequences.
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