Mundell and Laffer Agreed High Taxes Hurt Poor

(p. A12) Robert A. Mundell began to make his name in the 1960s as a maverick economist eager to challenge his more orthodox colleagues. He ended up influencing mainstream economic policy in the U.S. and Europe in profound ways that few of his peers could have imagined.

. . .

Dr. Mundell’s influence on U.S. economic policy also dates to the 1960s. He was teaching at the University of Chicago when he met Arthur Laffer in 1967. Dr. Laffer, a Stanford-educated economist, later recalled their first meeting as a shock. “In walked a sallow, tousle-headed, pipe-smoking figure wearing a faded trench coat belted with a clothesline cord,” Dr. Laffer wrote.

The disheveled Dr. Mundell and the buttoned-down Dr. Laffer agreed that steeply progressive taxes were deterring investment and employment in ways that hurt the poor.

In the 1970s, Dr. Mundell argued that the U.S. should defy conventional economic wisdom by raising interest rates to protect the dollar’s value while reducing taxes to stimulate the economy. “I knew I was in the minority,” he said in an 1988 interview. “But I thought my vote should count much more than the others because I understood the subject.”

Dr. Laffer introduced Dr. Mundell and his ideas to Jude Wanniski and Robert Bartley of The Wall Street Journal editorial pages, whose work influenced Republican politicians including Jack Kemp and Mr. Reagan.

For the full obituary, see:

James R. Hagerty. “Canadian Economist Inspired U.S. Tax Cuts.” The Wall Street Journal (Saturday, April 6, 2021): A12.

(Note: ellipsis added.)

(Note: the online version of the obituary has the date April 9, 2021, and has the title “Robert Mundell Helped Inspire U.S. Tax Cuts and the Euro.” In the last paragraph quoted above, the online version mentions Jack Kemp. The print version did not.)

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