"I helped create the GOP tax myth. Trump is wrong. Tax cuts don't equal growth."

[pnwmom]

https://www.washingtonpost.com/news/posteverything/wp/2017/09/28/i-helped-create-the-gop-tax-myth-trump-is-wrong-tax-cuts-dont-equal-growth/?utm_term=.762f5d422adc

Four decades ago, while working for Rep. Jack Kemp (R-N.Y.), I had a hand in creating the Republican tax myth. Of course, it didn’t seem like a myth at that time — taxes were rising rapidly because of inflation and bracket creep, the top tax rate was 70 percent and the economy seemed trapped in stagflation with no way out. Tax cuts, at that time, were an appropriate remedy for the economy’s ills. By the time Ronald Reagan was president, Republican tax gospel went something like this:

SNIP

Based on this logic, tax cuts became the GOP’s go-to solution for nearly every economic problem. Extravagant claims are made for any proposed tax cut. Wednesday, President Trump argued that “our country and our economy cannot take off” without the kind of tax reform he proposes. Last week, Republican economist Arthur Laffer said, “If you cut that [corporate] tax rate to 15 percent, it will pay for itself many times over. … This will bring in probably $1.5 trillion net by itself.”

That’s wishful thinking. So is most Republican rhetoric around tax cutting. In reality, there’s no evidence that a tax cut now would spur growth.

SNIP

The flip-side of tax cut mythology is the notion that tax increases are an economic disaster — the reason, in theory, every Republican in Congress voted against the tax increase proposed by Bill Clinton in 1993. Yet the 1990s was the most prosperous decade in recent memory. At 37.3 percent, aggregate real GDP growth in the 1990s exceeded that in the 1980s.

Despite huge tax cuts almost annually during the George W. Bush administration that cost the Treasury trillions in revenue, according to the Congressional Budget Office, growth collapsed in the first decade of the 2000s. Real GDP rose just 19.5 percent, well below its ’90s rate.

SNIP

[Gothmog]

1. Tax cuts do not grown the economy or pay for themselves

[Jim Beard]

2. It depends, sometime there is a need for them but not constantly harping for them.

Tax cuts and borrowing are ways of stabilizing our economy but only used by rational people.

[Eliot Rosewater]

3. There is never a reason to cut taxes on the wealthy and healthy, large corporations unless

they are paying "effective" tax rates over 60%, anything less than that and they are getting away with murder.

[Jim Beard]

6. FDR made a deal of sorts with HIS rich neighbors.......I am going to tax you 90% unless

you put your money back in the economy which will produce jobs. This money will not be taxed as much IF you keep reinvesting it into the economy.

Like now, the money is all in the Billionaires hands. We need money for economic stimulation.

They will get to keep it if they invest in this country, if not, the pay 92% in taxes.

The problem with the republican plans is that they do not demand the rich reinvest.

[Eliot Rosewater]

7. Reagan and his henchmen appealed to ignorant people who bought into the lie about

taxing the rich being unfair.

It is sad there are that many of us that are that susceptible to obvious bullshit.

Thanks for supporting my position, I have very extreme positions.

Like nationalizing most everything that is necessary to live. Just about at least.

[Mopar151]

20. Exactly

Invest has to mean more than buy your competitor and shut them down!
A modern version could give advantages for paying a living wage, lessening environmental impact, paying fair share of local taxes.
Arbitrage, high speed trading, derivatives, and other "pure money plays" need to be taxed at a higher rate.

[HopeAgain]

12. It is a great way to turn us back into a feudal society...

With the growing income disparity, that is where we are directly headed. The Lords will be living large while the rest of us support them and enjoy a barely sustenance living.

[Bradshaw3]

4. Thanks for posting. EVERYONE needs to read this!

Everyone meaning repubs, commentators and everyday people. Thom Hartmann talked about this piece this morning and I was going to post a link to it, so thanks.

[Wounded Bear]

5. Well, they do spur growth in CEO class incomes...

That is the intent of them, of course. If you look at it from the perspective of the average billionaire, Reaganomics is working just fine.

[Jim Beard]

8. I have been able to keep this link for several years through several computer

breakdowns.

This is from the bottom of the link concerning tax cuts
http://www.huppi.com/kangaroo/L-taxshare.htm

Myth: Tax cuts for the rich shift the tax burden upward.

Fact: Tax cuts enable the rich to pay more taxes because they make more; the poor pay less taxes because they make less.

Tax cuts on the rich increase income inequality, by giving the rich more money to make money. Although their individual tax bills fall, the number of rich people grow, and as a group they pay a larger share of all taxes paid. Unfortunately, this expanding group of newly rich people does not expand beyond the richest 1 percent -- which is too few to benefit most Americans. Furthermore, their increased share of the national income represents a decrease for the poor. In relative terms, the poor pay less taxes because they make less income. Only supply-siders would spin this as a success story for the poor.


This is the main link to all the other liberal info links
http://www.huppi.com/kangaroo/LiberalFAQ.htm#Backmobility

It is worth it.

[pnwmom]

9. Good article. Thanks for sharing.

[Beartracks]

17. The for tax myth links!

=========*

[Locrian]

18. thanks - been looking for something like that nt

[maxrandb]

10. I have a simple solution

Tax the 1% at 90%, including corporations, but allow that any increase in Worker's Wages, Investment in Company Expansion, or increase in employee benefits would reduce the tax burden.

Only wage increases they couldn't claim as a deductions would be those of Executive Level non-hourly employees and cap Executive Pay at 10X the highest paid hourly worker.

[Mr.Bill]

11. Only two presidents in my lifetime (I'm 64)

have doubled the national debt. Ask any republican to name them. None will give you the correct answer, which is Ronald Reagan and George W. Bush. The two presidents that made huge tax cuts.

[Jim Beard]

13. This is their game. Keep cutting taxes and if possible, try to shrink government They wish but

they usually take the money. Cut taxes, make government smaller, cut taxes again and continue to shrink government until there is no more government.

[Mr.Bill]

14. Trouble is, they never shrink the government.

They print money, throw it at the Pentagon and fight unwinnable wars. Programs like Medicare, Unemployment and Social Security are self-funded, although there will always be arguments as to what degree they are self-funded. The Pentagon all comes out of the general fund.

I wonder how many wars we would be fighting if they were paid for through a deduction listed on our pay stubs.

[Jim Beard]

15. Exactly

[Nevernose]

16. But now that politicians are funded almost entirely

By the one percent, who's left that's ever going to vote to raise taxes to reasonable levels or cut military spending?

We need public funding of elections and an amendment to completely remove all private money from politics.

[jmowreader]

19. John F. Kennedy did this to them

JFK cut taxes on the top bracket by 20 points and the economy took off...so, doing it again should work fine, right.

Stop.

Kennedy curt the top rate from 90 percent to 70, which did two things: put a lot of money into the hands of people who still thought they had duties to their workers, and left a lot of money in the hands of the government.

The Laffer Curve says there is a perfect rate for taxes, and a rate below that will keep the government from functioning. Unfortunately, we went into “below that” mode in August 1981.