Last, and possibly most important, the DWL from a tax is proportional, not to the tax rate, but to the square of the tax rate. So doubling a tax rate will quadruple DWL. Cutting a tax rate by half will reduce DWL by 75%. So, imagine that Republicans somewhat succeed in cutting the corporate income tax rate from 35% to 20% and assume, for simplicity, no state tax on corporate income. That’s a 43% drop in the tax rate and the new tax rate is 57% of the old tax rate. The new DWL will be (0.57)^2 of the old DWL. That’s 0.32. So the DWL falls by 68%!
What appears to be the core of Trumpism, based on his earliest priorities and his closest advisers? The blatant, energetic, eager violation of the right to freely choose what to do with one’s justly owned property and energy, and fierce denial of the principle that through such freedom we create immense and unprecedented wealth for the human race. (Again, most libertarians don’t just clutch “freedom” as a value disconnected from all other values, although they privilege it in most cases. They also believe freedom is conducive to the greatest human wealth and happiness, overall. It’s a philosophy of social betterment as well as a philosophy of individual rights.)