The reason WHY trickle-down tax cuts don't work

The theory behind trickle-down tax cuts is that, if the rewards to certain very talented businesspeople is increased, they will then be incentivized to create even more economic activity.

The problem with this picture is that it completely misrepresents what businesspeople can do. In certain very rare instances and environments, a very small number of businesspeople with very specific talents can build large enterprises. Usually these environments occur when a new industry either initially begins or when an old industry drastically restructures.

In those very short moments of opportunity (historically, they rarely last more than a few years), a handful of businesspeople with incredibly specific skills, talents, connections, personalities, etc. can build up enormous business firms, employing huge numbers of people in a very short space of time. But once that moment of opportunity closes, often there is no new moment of opportunity in that industry for many decades (or even longer).

Thus, once that moment of opportunity had closed, the resulting Bill Gates or Andy Grove or Ray Croc is very wealthy indeed. But Gates or Croc's skills and experiences are very focused on the single opportunity they exploited. It has almost never happened that a single businessperson built two successful industry-dominating firms from ground up in two different industries (in fact, I can't recall a single example of this).

Further, a businessperson of this caliber in the very special environment we're talking about is largely unaffected by comparatively small changes in his tax rate. The opportunity presented to him is so unique and compelling that he would do the same things for much less money, and would do them for much more money.

Thus, when you increase the reward to the ALREADY successful entrepreneur (i.e., he has already made a big pile from his entrepreneurship), you don't actually encourage him to do anything new. He can't, he's ALREADY done the one single great thing he could do. The firm he already built up dominates his industry, and he will be extraordinarily unlikely to be able to do it again. All you end up doing is giving him more money to give to his kids.

World's Most Beautiful Unknown Libraries: Pasadena Central Public

Pasadena’s Central Library is a combination of Spanish and Classical elements, combined with a free and innovative hand by one of the twentieth century’s most neglected great architects, Myron Hunt. The library was built as part of Pasadena’s 1920s revamp of it’s major civic buildings – Pasadena’s City Hall, with a similar, though more formal, mix of Spanish and Neoclassical elements, was built simultaneously. The exterior of the library provides an interesting visual conflict. A brutally simple wall is topped by heavily elaborated Corinthian windows peeping out above. After clearing this wall, the visitor enters a courtyard of unexpected interest. We now see a full-fledged, quite elaborate façade.

Hunt however maintains his contrast between lavish decoration and severe, even brutal plainness – while the entrance façade is lavish, the rest of the courtyard is an almost minimalist expanse, relieved only by a very simple fountain.

The main hall of the Pasadena Library is the most imposing interior feature. Extending over two hundred feet from the building’s end to end, it’s a vast churchlike space with only the most minimal of decoration.

Besides being an admirable compliment to the Pasadena City Hall across the street, Pasadena's Central Library is one pinnacle of Myron Hunt's largely unheralded campaign from 1903 onwards to create an architecture particularly suited to the Southern Californian landscape, based upon Hunt's early career with the Prairie School in Chicago and his study of the work of the First Bay Area Regional School - especially the work of Willis Polk.

Though Hunt's work initially appears to be merely a sophisticated gloss upon versions of Spanish revivalism if not examined closely, the Pasadena Central Library shows Hunt to be highly adept at combining revival elements with a free and unique hand. And you have to love the palm trees poking out from the courtyard.