Tax Cuts and Aggregate Demand

Here's a letter sent yesterday to the Wall Street Journal:

Alan Blinder asserts that opposition by tax-cut proponents to further increases in government spending is inconsistent ("Obama's Fiscal Priorities Are Right," July 19).  Not so.

Viewing reality through a Keynesian template, Mr. Blinder assumes that tax cuts "stimulate" the economy only in the same way that government spending does: by increasing aggregate demand.  In fact, though, the chief argument for tax cuts is not that they...