Read from the American Thinker:
Lying About Bush's Tax Cuts
By Andrew Foy and Brenton Stransky
"The majority of the taxpayers in our country believe it a foregone conclusion that taxes will rise substantially in the near future and that the Bush tax cuts will soon be no more than a footnote of political history. You don't need to be a genius to see that the government will have to raise more revenue to pay for seemingly infinite spending, but before we resign ourselves to higher taxes, we should consider defending the Bush tax cuts against the left.
Two of the most oft-cited objections to the Bush tax cuts by the left are that it helped only the rich and it was largely responsible for the federal deficit at the end of the Bush presidency. Instead, it is true that if the current administration allows any or all of the Bush tax cuts to expire, economic growth will be slowed and tax revenue could actually decrease, perpetuating our deficit dilemma.
The Economic Growth and Tax Relief Reconciliation Act of 2001 and the Jobs and Growth Tax Relief Reconciliation Act of 2003 broadly lowered income, capital gains, dividends, and estate taxes. Fanning the lie that only the rich benefited, liberal economists Peter Orszag and William Gale described the Bush tax cuts as reverse-government redistribution of wealth, '[shifting] the burden of taxation away from upper-income, capital-owning households and toward the wage-earning households of the lower and middle classes.' This criticism stuck so well that it is difficult to find a liberal today who doesn't believe that these tax relief measures were anything more than 'tax cuts for the rich.'
But the data does not support this conclusion. According to the non-partisan Congressional Budget Office (CBO), the Bush tax cuts actually shifted the total tax burden farther toward the rich so that in 2000-2004, total income tax paid by the top 40% of income-earners grew by 4.6% to 99.1% of the total.
This shift may have occurred because as the wealthy (who are arguably the most industrious and productive citizens) are better-incentivized to be industrious and productive through lower taxes, they create higher incomes for themselves and end up paying more taxes. The Bush tax cuts did shift the tax burden, but not in the direction most liberals think.
The second major misconception spread by the left about the Bush tax cuts is that the lower tax rates caused the federal deficit woes we face today. Keeping with the party line of blaming the previous administration for all of today's problems, Speaker Nancy Pelosi (D-CA) quipped in a news conference on January 8 of this year: 'Let me just say that the tax cuts at the high end ... have been the biggest contributor to the budget deficit.' Of course, the Speaker would have us believe that overspending has nothing to do with our deficit.
In fact, the Bush tax cuts actually increased government revenue. According to economist Brian Reidl of the Heritage Foundation, The Laffer Curve (upon which much of the supply-side theory is based) merely formalizes the common sense observations that
•1. Tax revenues depend on the tax base as well as the tax rate,
•2. Raising tax rates discourages the taxed behavior and therefore shrinks the tax base, offsetting some of the revenue gains, and
•3. Lowering tax rates encourages the taxed behavior and expands the tax base, offsetting some of the revenue loss."
Read it all.
9 comments:
"Lowering tax rates encourages the taxed behavior and expands the tax base, offsetting some of the revenue loss."
How easy is it to debunk this myth? Easy: take it to its logical extreme.
Lower the tax rate to 0%. That should maximize tax revenues, according to your "Economics 101" theory.
All rightwingnut economics intends to do is keep fat-cat conservatives from having to pay their share of taxes. It's the most ungenerous, uncharitable, unChristian and most self-centered policy imagineable.
Diogenass: what do you call non-productive teachers that milk the taxpayer out of millions of dollars without any monitoring or accountability?
At least companies use the tax breaks to expand and put more Americans to work to produce something people can use.
What do teachers produce?
With tenure after 2 years and a lack of background checks, Ted Kazincky, Amy Bishop or Bill Aires could have been teaching our children.
My bad, they were teaching our children.
Does anybody know what these radical teachers and closet radicals are teaching and promoting in the classroom?
Campaign for cameras in the classroom!
This would protect our teachers and our students.
You think an unwarranted blanket attack on teachers stings me somehow, AnonyMouse? You think it has anything to do with the Laffer (or is it Laugher?) fable?
My classroom door is closed, so that outside disruptions are minimized. But it's always unlocked, and there are plenty of windows. And my boss -- and parents -- can come in when they like. That's just one of the reasons they call it a public school.
What do we produce? Well, we help to produce the next generation of Americans.
Diogenass: With half the schools in this country failing and the dropout rate at an all time high, how can you say you're producing anything?
leftwingloon ideologue teachers like yourself spending time online ranting during school hours instead of teaching and guiding children to their academic ambitions and goals is partially the reason, the others are tenure and unions.
What’s the incentive for teachers to do better in the classroom if they have a job for life without any threat of dismissal?
Cameras in the classrooms, remove tenure and unions! Problem solved!
After all isn't this administrations goal to oversee the our tax dollars in the banking, insurance and auto manufacturing, why not public schools that are doing much more harm to the next generation then any company or industry could possibly ever do.
Yeah? Buy a calendar, dimwit. Saturday night and Sunday afternoon is not class time. Besides, there are free periods during the day. We may work for slave wages, but we're technically not slaves... yet.
As for what we "produce" I'll stack my life's achievements against yours any day of the week, if your comments here are at all representative of your "lifetime achievements".
Your definition of "tenure" is way off, by the way. Nobody gets a job for life, especially not if they're a lousy teacher. So why don't you climb down off your aged soapbox, pull your head out of your butt, and go VOLUNTEER at your local school? You could probably work as a doorstop, at least.
So you think there are no "fat cat" liberals? And just what would you consider to be a fair share of taxes, being that 40% of Americans don't pay any now? If commie obama gets his way, maybe everything will be FREE for 80% of Americans. Of course, with few jobs left, where will the other 20% work?
Oh, there surely are fat-cat Democrats... just less of them than conservative fat-cats. (Face it: Bush would have never pushed massive tax cuts that we cannot afford, unless his patrons benefitted the most.)
If this overly simplistic (at best) Laugher Nonsense was a sound economic theory, then the logical extension is to eliminate ALL taxes. Society would undoubtedly thrive if that happened, right?
Your "analysis", JD, is silly. Who says that people who don't pay taxes don't work? Plenty of people work, but are below the poverty line nonetheless and plenty don't pay taxes because of it. If only 20% work and only 20% make money, there's something inherently wrong and fundamentally flawed with our entire economic system.
People make money in our capitalist system not only because of their own hard work. They benefit from being part of American society, and yes, they owe something to that system in return.
Call it a redistribution of wealth if you wish. Just remember, the Bush tax cuts were one of the largest redistributions of wealth this country ever saw... from the poor to the rich.
Sure, there are lots of people at the poverty level, but many are there by choice. If a person can get all the necessities of life paid by the gov't, then that person sometimes chooses to not improve his status so as to keep his gov't goodies. I personally know dozens of these people, and msot of them live as good as i do. And most of them are content to stay as they are. Charity is a good thing, but taking money from a person who earned it at the point of a gun and redistributing it to another isn't charity, it's vote buying. So while these folks might work, they don't pay taxes and they get lots of stuff that i don't. Striving for a better life in America will only get you punished through higher taxes to help the "poor". Many of them don't look too poor to me!!!!
Will you please stop it with the "rich owe the broke" thing? No they don't. That's the most ridiculous thing to say. "I just graduated school, got my first job, got my first car... let me thank those below the poverty line for making this all possible." Please... it's great you have empathy for the lower classes as they have a less privaliged lifestyle, but I agree with JD. TAKING my money and benefitting them, when I work hard for what I earn, is nothing but a bigger reason why I shouldn't even file my income taxes as I'm not broke enough for my government to care about me. You forcing the "emotionally" driven argument that I somehow owe my life to lazy/incompetent/poor/(insert synonym) people is nothing short of me forcing religion on you, its nothing but a personal view and you are never entitled, or the government, to tell me that I owe any part of my success to anyone but MYSELF!!!!
Not to mention, our "poverty" line, is a joke. We're the only country with people in poverty who are over-weight and drive cars. If you liberals had it your way, no one would be rich, no one would be broke, we'd all make 50,000 a year, drive the same cars, die of the same diseases, live in the same size houses, etc... and that is effectively eliminating what drives innovation and the strive for excellence, to be better than the next person, to not be just another slob on the couch eatin' cheetoh's watchin' Springer waiting for his unemployment check to come. I'm sorry but you liberals are breeding a generation of kids who aren't goal oriented and have no discipline. I don't know if it's the liberals or the public school system, both are outta-whack though.
Take a ride through some low-income neighborhoods. You'll see a lot of expensive clothing, shiny wheels on cars, jewelry, 500 dollar sound systems in trunks, flat screen tvs... STUFF I DONT HAVE!! They get free lunches for kids at schools, they don't have to do fundraisers for the sports they play, they get grants for college they dont have to pay back, and if you're a minority, you get even more. But OH NO!! OUR GOVERNMENT DOESNT HELP US ENOUGH!! WE'RE IN NEED!!! I DROPPED OUTTA SKOOL BECUZ MY TEACHERZ WUZNT LEARNIN ME RITE AND NOW I DONT HAVE INSHURENCE OR A CAAAARRRRR!! RICH GUY PAY 4 ME YOU OWE ME!!
Freakin' joke...
I won't give those in American "poverty" a dime for the same reason I won't give a homeless man money... at the end of the day he'll still be homeless.
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