A supposedly simple solution to a problem, which however only exists in the imagination.
In ancient Greece, Panákeia (Πανάκεια) was a goddess of healing. As an assistant to her father Asklēpiós (Ἀσκληπιός, also known as “Asclepius”), she was responsible for healing plants. Her name can be translated as “the all-healing”.
Derived from the name of the Greek goddess, the Latinised form “panacea” came to be used to mean something like a “cure-all”, i.e. a medicine that was said to be effective for all kinds of ailments. Often with the implicit caveat that, of course, such a remedy does not exist.
It could also be used in a figurative sense, for example by saying:
“Tax cuts are not a panacea!”
The term can also be understood to mean that “miracle cures” only exist in wishful thinking and therefore the desire for such a easy solution is irrational. A panacea in this sense is therefore a supposedly simple solution that does not really exist or at least does not (necessarily) have the desired effect.
Whether this is actually justified in the respective situation depends on the circumstances. In some cases, tax cuts can actually solve certain economic problems, while in others they tend to create new ones.