What should the government do to improve the economy

I was recently reading "The End of Prosperity: How Higher taxes will doom the Economy -- If we let it happen" which makes a lot of interesting points about national and international economic policies. What I found most interesting was the Laffer Curve, which shows government revenue increasing as taxes are lowered. This is in direct opposition to many current policies where an increase in revenue is attempted via a tax increase. This generally does not work as it increases the incentive to avoid paying the taxes. This will result in tax planning (looking for tax loopholes) and also reducing growth (thereby lowering the tax bill).

The book does a nice job of presenting IRS income tax data to prove the point (you can see when a tax decrease was implemented, revenue increased). Lower tax rates benefit the economy by allowing people to keep more of their paycheck (and also businesses to keep more of their profits). The book makes some interesting comparisons showing other countries tax rates and their economic growth. The lower the tax rate the more growth the economy is experiencing.

Other countries have been adopting the low tax rates of the United States (and lowering them even further) to stimulate investment in the economy. The investment comes as companies are attracted to countries which are growing and have favorable tax treatment (as this decrease the operating expenses). This trend can also be seen at the state level where high tax states like California are seeing business and economic migration to states with low or no income tax (like Texas and Nevada).

I think we should follow the economic policies of presidents like Kennedy (who was the first president to adopt the lower taxes high revenue policy) and Regan by lowering taxes thereby making our economy more attractive for investments.