It’s been established over and over again that massive tax cuts do not stimulate the economy. Even the Congressional Research Service released a study in September of this year confirming that tax cuts do not stimulate the economy.
The Atlantic Wire has a great article out talking about the last time we were told that tax cuts were the answer…
As Congress attempts to negotiate a way to cut the budget deficit and avoid a fiscal cliff, it’s worth remembering that one sticking point of the negotiations was supposed to eliminate the deficit problem entirely: the Bush tax cuts. On April 27, 2001, the conservative Heritage Foundation published the above chart, forecasting the effects of then-President George W. Bush’s then-proposed tax cuts — a chart that is, in retrospect, pretty hilarious. Pass the Bush tax cuts, the conservative non-profit predicted, and the future would be awesome. The tax cuts would so stimulate the economy that the government would start bringing in extra money starting in 2008. Alas, in real life, the Bush tax cuts led to huge budget deficits, and 2008 was, as you may also remember, the year of the financial crisis.
We were promised, by groups like the Heritage Foundation, incredible federal revenue.
Turns out that didn’t exactly happen. The nice part about the internet is that when you make predictions that turn out to be the complete, absolute opposite of what happened, we can dig them up.
The Bush tax cuts were also supposed to leave the wealthy with more money, which they would use to expand their companies and create jobs. We were promised at the time that cutting taxes for the rich would produce unprecedented job growth.
That also didn’t happen. But hey! When we cut taxes for the wealthy, they got rich! It’s strange, when you don’t take as much of their money in taxes, they wind up with more money.
This is probably why wealth disparity around the time of the Bush tax cuts skyrocketed.
And bear in mind, the Bush tax cuts have not expired, and the GOP wants to extend them.
Republicans continue to say they are open to raising revenue, but they want to do it without raising tax rates. “I’m willing to generate revenue,” Sen. Lindsey Graham said Sunday. “It’s fair to ask my party to put revenue on the table. We’re below historic averages… I will not raise tax rates to do it.” Whatever the reason for holding onto this technicality — that limiting deductions and closing loopholes is not the same thing as raising taxes — it is not based on recent evidence of what effect the Bush tax rates have on the economy.
When are people going to catch wise that the GOP is not looking out for almost every American by implementing policies which, throughout history, have made the rich more rich to the detriment of the workers in their companies?
As far as the Bush tax cuts go, and as far as any additional tax breaks for the wealthy go, let the fuckers die and listen to Warren Buffet: tax the wealthy at least at something close to what the rest of us pay. It worked for Clinton.