Lessons from the Great Depression

They are not the lessons many would surmise. Art Laffer, the creator of the Laffer Curve, theorizes that increasing tax rates do not necessarily increase tax revenues. He's been proven wrong on a few issues, especially after his infamous debate against Peter Schiff on CNBC in 2006. In the live debate, Laffer insisted that the economy and the mortgage industry specifically, were doing fine. Schiff took the opposite side of the debate--that the US economy was headed towards the mother lode of collapses due to unsustainable consumption fueled by debt and false prosperity. Schiff, of course, won that debate--and bet, handily.



In other words, Laffer totally missed the call on the impending financial meltdown.

But Laffer does bring up some good historical points on the Great Depression:

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