Converts good to bad

Brenda Looper, in her April 11 column titled “Matter of facts,” caused me to determine the reason my most recent submission to Voices had been deemed unworthy of publication: I had been guilty of factual error.

My hastily written and poorly composed letter was intended to contradict attorney Ruud DuVall’s implication ( in his most recently published Voices letter) that “supply- side” economic policy (Mr. DuVall calls it “trickle-down economics”) enacted during the Reagan administration had caused the large increases in national debt characteristic of those years.

A basic principle of supply-side economic theory is that decreasing federal income-tax rates will produce increased federal revenue, because money left in the private sector will tend to result in economic growth (greater investment in entrepreneurial innovation and product development), whereas money taxed away from the private sector for use in the public sector will, at best, result in wealth transfers, not economic growth. Growth in the private sector results in increased incomes subject to taxation, thus increased federal revenue.

Federal revenue totaled $517.1 billion in fiscal year 1980, the year prior to the start of the Reagan administration; during fiscal year 1988, the last year of that administration, federal revenue totaled $ 909.2 billion, having increased dramatically in spite of income-tax rate decreases. Greatly increased revenue should have resulted in a decrease in the national debt, but federal expenditures increased from $ 590.9 billion in 1980 to $1,064.4 billion in 1988, a rate of growth in outlays even more dramatic than that of revenue.

Our nation resembled a family whose breadwinner receives enviable pay increases, but then acquires new credit cards and creates exorbitant family debt, converting good into bad. KEN MILLER Little Rock