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  • Morning Bell: The Truth About Tax Cuts

    All you are likely to hear about low tax rates from liberals and their echo chamber in the media is that they don’t work—that they fail to gin up economic or job growth. Exhibit A for this preposterous proposition is the Bush tax cuts. The left wants you to accept it as conventional wisdom that the policy was a bust.

    Don’t believe it. The tax cuts enacted by the U.S. Congress in 2003 were an important cause of an economic expansion that roared for some 50 months and created 8.1 million jobs. The opposite philosophy—a stimulus that has crowded out private investment, plus an enormous health bill and a nightmarish financial regulatory package that are killing job creation—has only delayed recovery and left us with 9.1% unemployment.

    You won’t hear this from liberals. What you hear instead is a straw man argument that the tax cuts failed to pay for themselves. The Bush Administration and congressional leaders at the time went out of their way to be clear that the tax cuts were not expected to pay for themselves.

    Bereft of any other apparent principle, the liberal canon now includes one and only one organizing idea: government cannot be cut; it can only grow or stay at its current gargantuan size. For that to happen, liberals must use the concerns about massive deficits pushed up by a tremendous Obama spending surge to cow the nation into accepting big tax hikes and bigger government. Unfortunately, even some otherwise conservative stalwarts are falling for it.

    But rather than explicitly say “raise taxes” liberals talk about “revenue enhancements” (which somehow liberals think the American people won’t get), “fairness” and “shared sacrifice.”

    But for that to work the American people must be made to accept that lower taxes fail to stimulate anything and that, by implication then, higher taxes won’t hurt the economy. This why liberals work so hard to spin the Bush years. But here’s what really happened:

    President Bush signed the first wave of tax cuts in 2001, cutting rates and providing tax relief for families by, for example, doubling of the child tax credit to $1,000.

    At Congress’ insistence, the tax relief was initially phased in over many years, so the economy continued to lose jobs. In 2003, realizing its error, Congress made the earlier tax relief effective immediately. Congress also lowered tax rates on capital gains and dividends to encourage business investment, which had been lagging.

    It was the then that the economy turned around. Within months of enactment, job growth shot up, eventually creating 8.1 million jobs through 2007. Tax revenues also increased after the Bush tax cuts, due to economic growth.

    In 2003, capital gains tax rates were reduced. Rather than expand by 36% as the Congressional Budget Office projected before the tax cut, capital gains revenues more than doubled to $103 billion.

    The CBO incorrectly calculated that the post-March 2003 tax cuts would lower 2006 revenues by $75 billion. Revenues for 2006 came in $47 billion above the pre-tax cut baseline.

    Here’s what else happened after the 2003 tax cuts lowered the rates on income, capital gains and dividend taxes:

    • GDP grew at an annual rate of just 1.7% in the six quarters before the 2003 tax cuts. In the six quarters following the tax cuts, the growth rate was 4.1%.
    • The S&P 500 dropped 18% in the six quarters before the 2003 tax cuts but increased by 32% over the next six quarters.
    • The economy lost 267,000 jobs in the six quarters before the 2003 tax cuts. In the next six quarters, it added 307,000 jobs, followed by 5 million jobs in the next seven quarters.

    The timing of the lower tax rates coincides almost exactly with the stark acceleration in the economy. Nor was this experience unique. The famous Clinton economic boom began when Congress passed legislation cutting spending and cutting the capital gains tax rate.

    In late 2007 the economy began to cool. By 2008, it entered a recession. The housing bubble burst, precipitating a financial crisis. But after 50 months of unimpeded growth, it is ludicrous to insist that the tax cuts caused the recession, let alone the global financial meltdown. Even after the Fannie and Freddie Mac-induced bust, there were still one million net jobs created during the Bush years.

    President Obama inherited a difficult economic situation but made a robust recovery less likely by embracing a failed Keynesian economic philosophy based on deficit spending. The blast of stimulus the federal government gave the economy far exceeded anything previously contemplated in the textbooks. It is shocking that there are still a few who actually insist that the stimulus failed only because it was too small and want to double down on another one.

    Since tax revenues move up and down with GDP, the common-sense way to increase tax revenues is to expand the economy. This should start with a commitment not to raise taxes. Beyond that commitment, pro-growth policies such as revenue-neutral tax reforms dedicated to reducing tax rates, restrained federal spending, minimal regulation and free trade would raise more tax revenues than would be raised by self-defeating tax increases.

    In The Heritage Foundation’s plan, Saving the American Dream, issued last month, we call for tax reform. We lower tax rates to encourage economic growth but maintain tax revenues at 18.5% of GDP—their historical level. We do it by expanding the tax base by eliminating economically unjustified deductions and credits and we plow all those revenues back into keeping rates low.

    Liberals want to raise your taxes because they love big government. They will tell you that lower tax rates accomplish nothing, but government spending will. Don’t buy it.

    You can follow Mike Gonzalez on Twitter @Gundisalvus

    Quick Hits:

    Posted in Ongoing Priorities [slideshow_deploy]

    102 Responses to Morning Bell: The Truth About Tax Cuts

    1. ThomNJ says:

      I stll have a small copy of a chart published by the Treasury Department back in 2006. It shows that by 2005, the federal government had collected the HIGHEST LEVEL OF FEDERAL RECEIPTS in our history due to the tax cuts under GW Bush. The dems and the current admin are stuck in their ideology and refuse to see the truth in front of their very eyes. Sad and tragic for all of us.

    2. Victor Barney says:

      The real truth about the Obama "fundamental transformation" of America(Israel by the seed of Joseph,
      NOT Judah/Gen. 48:16) is the Biblical First Born Covenant between Eve/Cain/Lucifer! It also is written that the first(Cain) shall be LAST and the last(Able) will be FIRST to be resurrected! Next comes the two-witnesses of Chapter 11 of Revelation by next fall at the latest! No? Watch! Did you know that if I'm reading the signs of the times correctly, Obama is the "right" Marxist(Anti-Christ, as Islam by the way) over the real Israel(Brother England, already Marxist since at least Churhhill, FDR's cousin) at the right time! No? You won't be telling me that by spring of 2016! Watch!

    3. btant says:

      I find it remarkable that liberals cannot put the interests and welfare of our country above this Pavlovian excusing of Obama and his miserably failed policies. His whole liberal agenda has failed on every objective and measurable level. I think even he must understand on some level that what he has taught and embraced as true does not work in the real world. I can say without reservation that he seems like a very nice man, but has proven to be totally incompetent.

      • Ken Jarvis says:

        People NEED Consumer Protection –
        HCare (ObamaCare) and
        Worker Protection (Unions) –
        ALL of these the GOP OPPOSE.
        btant = Don't be s GOP Sheep or Parrot. The GOP doesn't give a SPIT about you.

      • Harleywood says:

        Why any working average joe would vote Republicans is beyond me..They will cut the throats of their own voters..It's happening now and will only get worse if we allow the GOP to destroy America over their hate of O"bama..The GOP offers nothing but tax cuts and thats it..I know My Wife and I pay the lowest taxes in 20 years ..so if all you posters here are making big money then.I see your point that you don't care about helping the poor and are selfish enough to cut funding for social programs …JUst think back 50 years ago and thank a Democrat for your retirement

    4. ThomNJ says:

      I stll have a small copy of a chart published by the Treasury Department back in 2006. It shows that by 2005, the federal government had collected the HIGHEST LEVEL OF FEDERAL RECEIPTS in our history due to the tax cuts under GW Bush. The dems and the current admin are stuck in their ideology and refuse to see the truth in front of their very eyes. Sad and tragic for all of us.

    5. Dennis says:

      Tax cuts work. They give the individual and business more room to grow. Individuals spend on the things they want and need. Businees expands by hiring and spending on new equipment. These cuts worked well during the Reagan years and they worked well while George W. Bush was in office. A lot of the damage that was done to this economy has been accomplished by the Democratic majority that has existed in the House and Senate. Even now, the Democrats control the Presidency and the Senate. They have done a terrible job of governing and they need to change what they are doing in order for this country to thrive. Smaller government, less spending by the government and more investment by the private sector will lift this country out of recession and back towards prosperity. We need people in office that will reflect these sentiments and implement them. If change does not come soon this country may suffer irreparable damage.

      • Ken Jarvis says:

        One of the first things Obama did was – a MORE TAKE HOME PAY – Tax Cut.
        Something the HF or Murdochs Empire (WSJ or FOX) never reported on. It put $1 BILLION a month into the economy.

      • clarence swinney says:

        Why did Reagan increase debt by 180%? No Revenue?
        His 750B Individual Tax Cut increased Individual Tax Revenue by 140B not lquite 750?
        Bush tax cuts same story. Borrowed 6000B.No revenue?

      • clarence swinney says:

        Since 1980, why did 3 conservative presidents take 1000B of debt to 10,000B???
        SB spend and borrow let kids pay tomorrow

    6. Dominick J. Golio says:

      How do we get the very important points of this article in front of the uninformed, mis-informated and dilusional American citizen taxpayers and prevent the liberal liars and spin masters from distorting the actual facts?

    7. Wes Evans says:

      Need to send this information to CNN, CNBC and CBS but they know this already. Some how we need to inform educate the general public. The MSM will not do it.

    8. Ray Reed says:

      Thanks for this summary of the benefits of cutting taxes, Mike G. Now, if only we can get this to the independents who are "on the fence" and the truly open-minded liberals and have enough them "get the message".

    9. Seth Warner says:

      Two points really need to be stressed now and forever by republican leadership:
      1) Who makes the bulk of private sector jobs available? Corporations.
      Why do jobs go overseas? Because costs are cheaper there. But lower labor costs are not the only lower cost. Taxes in many countries are a significant lower cost unless the funds are repatriated. So, naturally, our corporations expand overseas and leave their money abroad. What would happen if we significantly lowered U.S. corporate tax rates…to like about 10% vs 39.2% (O.E.C.D. average in 2010 was 25.5) and did not tax repatriated earnings?? Big time job growth in the U.S.A.
      2) Our leaders must always us the word "rates" when they talk about lower taxes. Oops, I just did it. The phrase "lower taxes" implies less revenue, which is just the opposite of the point that "lower tax rates" tries to make. This confuses the man on the street who knows that if you have the same or more spending and lower taxes you are not going towards a balance budget. The budget might be balanced with the same or even more spending with lower tax rates (that produce higher tax revenue) as this article implies.

      • The Dauntless Conservative says:

        You are most certainly correct, but don't overlook burdensome regulations.

      • clarence swinney says:

        Corporate effective tax rate paid is 22% in USA.
        Jobs go off shore for low cost labor low cost labor low cost labor
        How else Multi-nationals made record profits year after year?
        Buy low sell high. No bargain for American consumers
        Do you own check, Made in USA price vs foreign. Same item.
        Gold Toe Socks just moved 450 of our local jobs to Mexico
        Cheaper socks? Want to bet. I have current prices and will check same items a year from now.
        I have done it on apparel and found little reduction on price in stores…

      • clarence swinney says:

        Why do our Corporations pay an effective tax rate of 22% when top rate is 35%?
        Why does 5B of profit pay no tax?
        Why do corporations pay 1% of GDP in taxes versus 6 % in past?
        Why do not corporations create jobs in America?
        2,300,000 in China under Bush. Why do Conservatives like Chinese so much?

    10. mike says:

      none of this is an accident….face it and go on with correcting it….we are not dealing with people of good intent

    11. Glynnda says:

      Heritage, AMEN ONCE AGAIN!!!!

      I read earlier comments and think that the best way to get the word out is by "word of mouth" as always it is the best form of marketing……yes we do have to market to a crowd that is ignorant of the truth due to news networks etc. who are purposely holding back info from their viewers and regularly misinforming them about what is really happening……misinforming? Maybe I should just say it…..they are lying

      Glynnda

    12. Mike Gabel says:

      Obama and other liberlas have already used this language in debate as "failed policies of the past that got us into this mess…".

      After beginning the George W. Bush presidency with a recession as a result of the dot.com crash, and then enduring the effects of 9/11, our nation saw solid ecomomic recovery and growth. Unemployment remained low until the financial crisis of 2008, which was primarily caused by liberal housing policies.

      So far, I am amazed that prominent conservatives, including the Republican candidiates have not rebutted this false argument.

      • clarence swinney says:

        Lliberal Housing Policies?
        Who had total Control for 6 years of the Housing Disaster?

    13. Chris says:

      Great article Mike. Every time the libs bring up the last 8 years, I always have known that we had record job growth in during the firat 6 years of W's admin but did not know the exact numbers. This is good amo for this argument

    14. Patricia A. Fenati says:

      With the dot com crash, Bush inherited an economy almost as bad as the one Obama inherited. Bush’s taking office was quickly followed by 9/11 and Enron. A triple whammy!

      Unemployment was around 7%. And, if I remember correctly, the Dow Jones which had gone into the 13,000’s in the 1990’s crashed into the high 6,000’s during the early years of Bush’s term.

      After the tax cut, the market slowly climbed out of that mess and before the housing bubble burst, the Dow Jones had gone all the way to the 14,000’s. …. The housing bubble caused by Clinton and Democrats in Congress insisting that people who could not afford homes be allowed to buy them.

      Employment for much of Bush’s time in office was around 4.5%. That is considered full employment. There was also higher revenue during the Bush years than during the Clinton years.

      • clarence swinney says:

        Baloney. Six of Total Control gave us worst years in history.
        31,000 new jobs created worst since Hoover
        Spend increase by 92% and Debt 180%
        Destroyed Housing.
        Great Recession.
        Dow down big time.
        8 million lost jobs
        Got us in two horrid wars by telling documented 935 Lies.
        Took Peace on earth to Hell on earth. Hatred by 1500 Million Muslims.
        Let 10% take 100% of income growth from 2002-2007
        Middle Class got zero. Nothing.
        It is some stretch to attempt to claim those as good years
        .

      • clarence swinney says:

        Baloney. Six of Total Control gave us worst years in history.
        31,000 new jobs created worst since Hoover
        Spend increase by 92% and Debt 180%
        Destroyed Housing.
        Great Recession.
        Dow down big time.
        8 million lost jobs
        Got us in two horrid wars by telling documented 935 Lies.
        Took Peace on earth to Hell on earth. Hatred by 1500 Million Muslims.
        Let 10% take 100% of income growth from 2002-2007
        Middle Class got zero. Nothing.
        It is some stretch to attempt to claim those as good years
        .

      • clarence swinney says:

        Why did not Bush get more net new jobs per month?
        He shipped 2,300,000 to China.
        His job creation worst since Hoover
        Clinton left with 237,000 per month Bush got 31,.000. Pitiful.
        Carter got 218,000. Reagan cut it by 24%..

      • LowLife Kriminal says:

        But Clinton left a surplus and Bush left a deficit you must not have noticed and the housing bubble burst because or predatory lending practices such as ballon payments and ARM (adjustable rate mortages) not to mention the outright fraud of the banking community. The problem is that US companies need to be placed in a national security bubble if you take American dollars oversees and enrich our enemies(China,Iran,The Taliban, Latin American Drug cartels your funds should be taxed until it doesn't make fiscal sense to do business oversees. Think back to WWII the government said hey nice factory let me tell you what we need you to be building period this is war time no difference the blunder of all time was to start not 1 but two wars and cut taxes not once but twice, this flies in the face of all military doctrine and is the recipe for destroying an empire from within

    15. Patricia A. Fenati says:

      While there was higher revenue during the Bush years than during the Clinton years, the problem was spending! Congress spent and spent. Because the Republicans had both houses and the Presidency during most of the Bush years, Republicans must take most of the blame for the lack of fiscal responsibility in those years. But I think if you examine the record is was not just Republicans who voted for the spending increases, but Democrats too who added earmarks, grew favorite programs, and voted for the war and war spending.

      If we can get to a high revenue point again Congress must not meet the revenue (and beyond) with spending! It must use that money to work on the debt. Congress must also find an equitable way to reign in spending on entitlement programs.

      • clarence swinney says:

        Patricia, explain how Bush borrowed 6000B or more than we owed after 225 years?
        Oh! Flush up revenue?
        9-30-01– Debt 5,700B–9-30-09 Debt was 11,900
        9-30-01 Spending was 1800B—-for the fiscal year—-
        9-30-09 it was 3500B— for the fiscal year

    16. Robert says:

      The incremental effect of all government taxation (payroll taxes,personal income taxes, corporate income taxes, state income taxes, property taxes, captial gains taxes, sales taxes, estate taxes, fuel taxes, licenses and fees) equates to 43% of our economy – our tax rate. Heritage calls out federal taxes at 18.5% – which completely ignores the effect of federal mandates: Medicaid, CHIPS, Food Stamps, Unemployment, No Child Left Behind etc…. Every product you purchase pays the taxes of every single supplier, trucker, manufacturer, farmer, utility, and person involved in the process. Caesar wanted 20%; King George of England wanted less than 15%, but the U.S. wants 50%. Is the government entitled to 20% of anything? By the way, how is that massive November victory working for you?

      • clarence swinney says:

        Federal Government took in, 2009, 17.5% of our Total National Income..
        In 2010 it got 15%.
        It took 9% of all Individual Income.
        CBO>GOV has plenty numbers

        • Robert says:

          Which completely ignores the federal mandates to the states – who pay for the medicaid and the food stamps and section 8 housing, unemployment programs and education (over 50% of the state of Texas budget). Federal mandates account for almost 90% of the State of Texas budget, as well as
          a large portion of city budgets, county budgets and school district budgets. And it is just as bad (or worse) in other states. Which is why Congress, Obama, Bush I, Bush II and Clinton love them federal mandates.

    17. F.D. O'Toole says:

      Excellent article…sets the record straight. It's important for Conservatives to calmly assert these economic facts when discussing the current situation with independents and, yes, even liberals…although many of the latter seem to shrug off facts when they don't agree with the premise. There's always hope for the Liberals. I'm reminded of a song from the musical, The King and I, as the King is confronted with facts not in keeping with his worldview. He sings, "There are times I am not sure of what I absolutely know." This article may contribute to one of those times.

      • clarence swinney says:

        GREAT IRISH! REAGAN HAD 8 TAX INCREASES.__His Payroll tax Increase increased Payroll tax Revenue by 201B–__His 5 cent gas tax increased excise tax reveneu by 5B __His Individual Income Tax Cut of 750B increased Indiividual Income taxes by140B.__My 2nd grade teacher taught tme 140 is not bigger than 750.____Reagan increased Spend by 80% and Debt by 180%.__His 8 budgets spent more than we had spent in prior 50 years.__His 8 were over 7000B and we spent 6066 1930-1980__Congress? Ho! They returned his 8 with fewer dollars__Inflation? Ho!. In 1989 dollars, from 1948-1989 he spent 2..4 dollars in 8 for each dollar in prior 32 years__Reagan first peacetime big Spend and Borrow President.__Each president since 1945 worked hard to reduce the debt,__Reagan took over a less than 1000B debt after 200 years and increased it by 180^%.____.

      • D. Gearhart says:

        Forget honest intent for Libs, Their only objective is power& control and everyone knows there is no limit to a man's apetite for the control of others, if he has that particular psychosis. We know our best tax process will be a national sales tax. That way, revenue is based on the positive flow of the economy and not the idiotic intentions of delusional egocentrics in Washington. There is also no incentive to "play" with an economy that will be going off like a MOAB once all the effects of the simplified revenue stream kick in.Imagine, no layers of hidden taxes, a much smaller collection bureaucracy.and all based on the positive performance of the economy…along with a tight noose around Washjngton.

    18. Matt Matuszewski says:

      The article failed to include any reference to the fact that a war was begun and had to be funded, just when
      the tax cuts would have really had a significant impact on the economy over the next several years!

      • The Dauntless Conservative says:

        True, there was an increases in military spending, but with military spending comes increase in military contracts which create some jobs within that sector. The US Constitution mandates maintaining and Army and Navy, not food stamps, SS, Medicare.

    19. rayray says:

      Now let's try tax cuts without interest manipulation and Fed monetary policy to distort the market.

    20. Great Scott says:

      The president after the democrats hero, Roosevelt, lowered tax rates and cut taxes, Kennedy went from 81% to 70% and Ronald Wilson Regan's tax cut and tax rate reductions made Clinton's years. The only time Reagan approved an increase is when he made an agreement with the democrats to cut spending by an equivalent amount, which they did not. Then Bush 41 did the same thing and the dems did the same thing. Bush 43 with democrat votes cut taxes and these were extended by Obama cause ending the Bush 43 cuts would harm the economy, Obama said. New tax cuts today [not continuing previous ones, as status quo] will help the economy again. But how do you overcome the lame theory that unemployment money will stimulate the economy as Pelosi said ? Any one of the Republican candidates today, should be selected on their perceived ability to overcome this mindset.

    21. Don Vander Jagt, Gra says:

      So why is it the Republicans either don't know these truths, don't know enough to display the truth before the voters, or they are playing us, just acting like they care.

      Why can't they understand that their base likely is well aware of these facts, but many of the uneducated have no idea, never having never been told any thing other then what the left spouts over and over.

    22. MJF says:

      Liberals refuse to understand that tax cuts put money in people's hands and ease the tension between government and the People. They have it engraved in their brains that tax increases are what fuels the economy. When you don't have enough money, how can you pay more? It's like the Middle Ages where if you couldn't pay your taxes, you were thrown in jail until you could! That is the mind-set of Liberals.

      • clarence swinney says:

        Equality=Happiness
        Higher Equality of Wealth =Higher happiness of the people
        .

    23. Kevin H says:

      How can you only look at the first handful of years of the 2001 and 2003 tax cuts and stop there? If the Bush tax cuts are such good economic policy and are supposedly economic stimulators and job creators, then why did we flow right into the worst recession since the Great Depression? All you have to do is look at job creation, GDP growth and market performance in the Clinton years compared to the Bush years…and you'll see the Clinton years vastly outperformed the Bush years – it's not even close.

      The 2001 and 2003 tac cuts are still in effect – so i have to ask, why are they not to blame for any of the massive deficits and debt, or the terrible job creation numbers to close out the Bush admisnistration?

      • George Colgrove, VA says:

        Kevin H, It aint the taxes man! – it is the massive unfunded spending that has created those deficits. Bush did his share – yes. He is the third worse spender of all presidents, behind his father. Obama's unchecked spending had done far more harm than even the Bush's has. This is not liberal/conservative or republican/democrat – it is a goverment out of control. This government is pretty much made up of the same people who was there in Bush 41's time all the way through to today. Sure some got their fat pensions, but these goons trained the new goons. This institution is corrupt to its core and serves itself with contempt. Stop blaming a president or protect another. It is the whole package that has caused the damage you recognize to be true.

      • Great Scott says:

        Tax cutting policy does not yield a positive effect right away – it takes time. With Regan's cuts it took a year, but the benefit lasted through the Clinton years. Bush's policies created the environment for 8 million new private sector jobs. Have you seen a benefit from Obama's spending yet after two and a half years ? Obama's continuation of the recession is due to the restrictive and retribution polices on employers. Is that the hope and change you are ready to vote for again ? Its simple, leave more money in the producers' hands and everyone benefits.

      • Great Scott says:

        Plus its called government spending beyond what is received in the form of tax revenue. The previous recession started during Clinton's years and the 2001 tax cuts curtailed the adverse affects of the terrorist attack.

      • NANCI HOELCHER says:

        Go look at the graph of average American income.. flatlined for 30 years! Productivity is UP 80 % but workers are not getting anything.. NADA… nothing.. BUT the top 1 percent? THEIR income is up 400 percent.. yes, 400 percent.. over the same 30 years. THEN check out where the United States sits as for income disparity! You Republicans might be shocked… AND you Republicans OUGHT to be ASHAMED!

    24. veteranpatriot says:

      For over a century we have seen alternating shifts of Donkey and Elephant powers in Washington with nothing changing but the names. Both are inflicted with the terrible disease called Tax and Spend…to the tune of $14 Trillion. What a disgrace! Lord knows if we eliminated the words blame and shame from our "representatives" vocabularies, what would they say?! Tends to add credence to the fact that the left wing and the right wing are of the same corrupt bird.

    25. STeve says:

      What does Heritage think about the FAIRTAX? It looks better to me than the flat tax.

      • Ken Jarvis says:

        We need a 10 % National Sales Tax – NSTx
        8.5% goes to the treasury
        1.5% to Soc Sec
        0.5% goes to Medicare.
        ALL Spending – regardless of what for
        pays a 10% NSTx.
        NO Exemptions.
        The Reason the HF opposes it, is they Rich Would pay MORE TAXES.

        • mike says:

          Ken, if this eliminates other Federal taxes, the rich would pay more, but percentage wise they wouldn't. and the tax would be considered extremely regressive! And it would be, the poor spend all their income the rich don't.

    26. Dr. H.D. Sinopoli says:

      It's not only liberals who want our taxes, what do you thing sustains the progressive lifer Republicans. It's about time the American people wake-up and realize they are being bitten by the same dog.

    27. Dr. H.D. Sinopoli says:

      It's not only liberals who want our taxes, what do you thing sustains the progressive lifer Republicans. It's about time the American people wake-up and realize they are being bitten by the same dog.

    28. Dr. H.D. Sinopoli says:

      The life-long Republicans love taxes just as much as the liberals. The American are being bitten by the same dog…different name but just as tenacious when it comes to sucking money from people.

    29. Ciarra says:

      Hi Mike,
      What credible sources are you using to come up with your figures?

    30. Jay says:

      I would think that if the tax cuts truly worked then why did the US not sustain economic growth. The tax cuts have been extended past their expiration yet we are not having a rebound in jobs. I agree that it is possible that there could be some positive economic activity that can be attributed to the tax cuts. But if a true analyst were to look at the entire financial picture of the United States during the Bush years, they would be more likely to attribute job growth and economic development from low FED rates and the super-inflation in the housing market and financial markets. This inflation created artificial growth, which created an artificial collection of sustainable jobs and an artificial demand in housing that trickled into inflated demands in other markets.

    31. Jason says:

      To continue . . . I am more liberal minded so I am sure my opinions are debunked immediately for that reason alone. However, as the liberals have been portrayed, I think there should be a balance of cuts and additional levied taxes to get us out of the current whole. And, I believe that tax cuts for top 1% of earners does not put money back into the economy but it is the middle class that buys the everyday goods that can truly save the economy. Everytime that dollar moves from one business to another is when our economy is healthy. Not when another rich elitest pumps another Lamborghini into his garage.

    32. clarence swinney says:

      Wiow! What a joy to read these posts. Most uninfomed group I have encountered. __Bush and Republican Congress had total control for six years__Spend increase 92%-Debt increase 112%–Job decrease from 237,000 per month at 31,000 or lowest since Hoover. Great Recession-Housing Disaster–Two dumb wars-look in the mirror you did i__Worst six years in our History.

    33. Dan says:

      You are aware, I suppose, that we had a GLOBAL ECONOMIC COLLAPSE in 2008, right?

      Really. How can you ignore that?

    34. F.D. O'Toole says:

      Excellent article. As mentioned above, history is constantly rewritten by the Liberals and their media enablers/propagandists. Facts contained in the article should be convincing to those who are open to be convinced. Unfortunately, Liberals simply get angry when confronted with facts and reasonable arguments and resort to cant phrases like, "It's all about oil."

    35. Ken Jarvis says:

      TAX the Rich,
      They have the $$$.

    36. Bob Cincinnati says:

      I agree with the the main content of the article. We just can't forget that the boom in housing during these years would have been different had the lenders only lent money to people that could afford to pay back the loans. The jobs "Created" during this period would have been lower if we wouldn't have been building homes that no one could afford. Both parties are to blame for the housing issue which we all know was the start of the problem and continues to be a problem.

      This is a very complex issue that starts with spending only what you have coming in. Until we have people in Washington will to "Man Up" and tell the truth to the American public we'll never get out of this!

    37. Pete in AZ says:

      Not To Forget!!
      The tax cuts and programs enacted by Ronald Reagan in the early 80's sparked an economy that erased J Carter's economic legacy of shame and supplied Slick Willy with enough 'cover' to slide through his 2 terms, as long as he left things pretty much alone. Poor Ronnie gets blamed for the things that the alien Congress hanging around his neck forced him to do.

      • clarence swinney says:

        Pete thje good old days Carter Years.
        GDP 3.4%
        a record 218,000 net new jobs per month
        Debt under 1000B
        No foreign conflicts
        Then Reagan rode in on old SpendoBorrowo his great pride and joy
        Increased spend by 80% a peacetime record and Debt by 180% and reduced Carter new job creation by 24%. Had more members of his administration convicted of crimes than the grand total since 1900.
        Got us involved in five foreign conflicts.
        Reagan has only one good domestic number Dow increased.
        Blarney Baloney blows smoke . Facts hurt
        I ask only prove me wrong with numbers and facts not sentimental blarney.
        I voted twice for the affable dunce. .

    38. manny says:

      I'm an elderly liberal and I believe in civil discourse. It may well be the case that Bush's tax cuts spurred economic growth. Nevertheless, I question who benefitted from that growth? Not middle class Americans and not working class Americans. To praise deregulation is also a mistake. We don't need more regulation, we do need better regulation. The sane regulation of banks , hedge funds, and large corporations is necessary for the good of the nation as a whole.. An unregulated environment can lead to disastrous damage. A good example of no regulation is cancer, an uncontrolled growth that kills lots of people. Who can object to wise regulation of restaurants or of toxins in our food or our drywall? I personally feel that we will never have a balanced budget without increasing taxes AND cutting expenses. Rewarding the greedy because we would like to be richer does not make sense to me. I am not arguing that to be rich is to be greedy. I will argue that raising the capital gains tax will not put a lot of people in the poor house.

    39. Richard Ford says:

      I'm not an economist but there is something that has bothered me for a long time about the conservative reaction to the Stimulus and indeed the whole concept of Keynesian economics. There is an institute in Santa Fe New Mexico that studies complex systems, one of which is markets.Their assertion is that markets are self regulating and autocatalytic. That is they can't be manipulated by infusions of cash.
      Why is it that I never hear this articulated by conservative economists? The usual response is that stimulus has never worked when the more accurate way to state the case would be that it has no chance of ever working because it is a fictional construct to legally embezel taxpayer money.

    40. KC - New Mexico says:

      Establish the flat tax for everyone. Today, the rich have incredible loop holes that allow them to pay very little tax in relation to the amount they actually bring realize in income. The poor (average of $36,000) do not pay any tax, in fact nearly 50% of Americans do not pay tax due to loop holes, and the various provisions outlined in the current tax code. The democrats want the rich to pay more, raising the percent does not address the issue. The republicans do not want to mess with the percent. So use the flat tax. Everyone pays – something. If we used 10% flat tax on all realized income, the rich star in Hollywood, or rich person in Washington DC making $1,000,000 a year would pay $100,000 in tax. The poor person making $36,000 a year would pay $3,600. Even if the poor person is receiving food stamps, and other government handouts, they would need to pay back some portion of this. Basically, if you can vote (you are an American citizen), you will pay something towards income tax. There are no exceptions, no deductions, and no loop holes. There is little need for IRS, tax attorneys, tax consultants. All tax exempt organizations are no longer tax exempt. In addtion – the Fairtax on purchases could be used in conjunction with the flat tax.

    41. D. A. White says:

      I looked up the financial reports after the 2003 tax cuts and found that for five years in a row we collected more taxes and the GDP grew. Unfortunately we didn't reduce government spending it grew also. when will we ever learn?

    42. Ron W. Smith says:

      There's truth in what Gonzalez says. It's what he doesn't touch that causes his article to be one-sided and the stuff of propaganda.
      First of all, putting money in the hands of a few in order to promote job creation while at the very same time wage earners' benefits, earnings, and work conditions are changing for the worse through the concerted efforts of some to undermine the social safety net, hard-earned since the 1950's especially, is vaguely reminiscent of the Middle Ages. Few in those times had the assets, the rest the risk. The presumption that making some richer by saving them from significantly progressive taxation will turn them into job creators is good old trickle-down economics. The truth since 1980 is that wages, adjusted for inflation, have grown by about 8%. Wonderful. The rising tide that lifts all boats missed quite a few folks while benefiting a privileged few.
      Second, creating prosperity while deregulating the workplace and rewards potential of everyone in it, effectively reducing the potential for tens of millions to experience that prosperity really, is not the America I have known for 74 years. Although never a union member myself, I lived through the post-1950 heyday of unionization, which saw the growth in wages, benefits, and conditions every worker experienced because of the influence of unions on EVERYONE'S rewards package. Just by being there, unions made all workers' lives better, union members and non-union members alike.
      Now, we are headed rapidly to a situation where workers are expected to rely on employers' generosity without having unified voice. Nice for business owners, potentially lousy for the workforce. Some owners will be very generous, but many won't feel compelled to be overly concerned with offering their employees great wages, benefits, and work conditions. There's a kind of nostalgia for slavery we must guard against–employees who are expected to do the work and shut up, employers who won't hesitate to exploit their hirelings while they themselves grow rich.
      Buried in the Right's approach to jobs creation and the diminishment of workers' rights and their safety net is much mischief in the making. Tax cuts and anti-unionism are but the veneer on quite an ominous agenda Gonzalez does little to touch upon.

    43. Ron W. Smith says:

      There's truth in what Gonzalez says. It's what he doesn't touch that causes his article to be one-sided and the stuff of propaganda.

    44. RennyG says:

      As always, tax reduction is effective and productive revalent to our economy.
      The main thing at this point of this "political game" is not to "INCREASE THE DEBT!!!" Just say right now before any more negotations go on, "NO DEBT INCREASE," now let's talk!!!! If we have the ability to stop the increase, do it NOW!!!!!
      Don't you know the day after the debt would be increased the big O and his czars will go "golfing!!!!!"
      The hell with putting 'self" and 'politics" before we the people!! Renny

    45. Jim Uberti says:

      Someone, much earlier, asked why Obama supporters did not see their mistake in voting for him.
      There's a huge and growing division in this country. If we changed the major political labels to Liberal and Conservative, there would be a major realignment of the voting rolls.
      But those Liberals who still cling to their allegiance to the man of "Hope and Change" are not budging. In fact, they're digging in. Difference s of ideology has morphed into hatred. The next election will be the most bitter that any of us has ever seen.
      How to fix it?? We can't. Just beat them at the polls and let the chips fall.

    46. AD-RtR/OS! says:

      The Left's greatest nightmare is that Congress will not increase the Debt Limit, and that portions of the Government will have to be shut down as incoming revenues are used for debt-service, and the public not only will not notice, but will thrive in a lessoned regulatory environment.

    47. Donald DaCosta says:

      Mr. Gonzalez is absolutely correct but unfortunately the Left has done and continues to do, such an excellent job of demonizing George W. Bush, everything he said, didn't say, did and didn't do that, like the real root cause of the 2008 economic meltdown, this story will not see the light of day anytime soon. What is even more infuriating is that prominent Republicans are not shouting these facts and refuting the Democrats demonstrably false claims from the proverbial rooftops. What I fear is that they fear the immediate media backlash that will inevitably result from their speaking the truth. I don't know what advice their getting from Heritage but if it's not that they need to be more aggressive, thick skinned and inured against media agitprop then they're not getting good advice. They need to speak out, speak the truth laced with factual references and forget these agonizing attempts at bipartisanship; peace, love and friendly give and take with a bunch of political sharks.

    48. John Engleman says:

      It is essential in all tax discussions to use the term" Tax Rate Cuts" rather than just "Tax Cuts". They are not the same thing. "Tax Rate Cuts" have always increased tax revenue . Your article above got these 2 terms correct most of the time , but not 100%.

    49. Blair Franconia, NH says:

      Adam Smith, the Scottish economist who wrote THE WEALTH OF NATIONS, favored tax cuts. So did JFK, Ronald Reagan, and George W. Bush. The Democrats NEVER have.

    50. Denver says:

      Sorry, I didn't understand the new format. I wasn't making a reply to Mr. O'Toole's excellentr comment with which I agree.

    51. michael mudrak says:

      I personaly feel manufactoring should be taxed at 10% aND CORPORATE @ 15%the ranks of the unemployed
      are skilled more in tune with manufactoring and mech. trades. also with low tax rates take away the deductions.
      and watch us grow. May GOD bless America .

    52. George Colgrove, VA says:

      We can continue to cut taxes – that would be great! But the large number of consumers for which jobs are produced already do not pay taxes anymore. They also get additional unfunded credits that add to the national debt. The formula that Kennedy, Reagan and Bush set will no longer work. Prior cuts allowed for lower to middle-income households to buy more thus create demand. Well the large part of these households pay ZERO taxes and most of these get more money back then they paid in. Unless the new policy increases credits, there will not be money at the low-end to spur demand which will create jobs. All the tax lowering on the upper end will do is make the coffers even larger while waiting for demand to increase. Corporations already have cash for expansion – trillions! Lowering taxes may provide some help to some companies, but it will not have the effect that is being sought.

    53. toledofan says:

      Another great article and it's obvious that Washington isn't paying attention to what America needs but is doing what is best for the political parties and in these times it looks like the lion share of the problem lies with the Obama Administration and the Democratic controlled Senate. This bunch, is , in my estimation, the worst Administrations I've ever seen. It's too bad that the politicans think they are bigger and better than the rest of us.

    54. R. Hurt says:

      No TomNJ-the people have decided to keep reelecting failed ideas in the form of Socialist-Communist-Facists. Anything that is detramental or will lower this nation's standard and economic picture has been given to us by the one and only Democratic party; the party of anti-American, anti-US Constitution, anti-Christian, anti-free enterprise, anti-economic improvement, and just about anything that is freedom loving.
      The Dems have been slowly getting rid of the American way for the last 100 years. If we want our nation back, then we need to drive every freedom hating Democrat and their accomplices out of government-forever. If the Dems were honest they'd allow their true name to be used-Socialist/Communist Facists. If we don't get this done by the year 2012, then we will have lost this great nation to an evil empire-the Liberal Democrats.

    55. PETER TURANO says:

      It's about time you guys wrote on this subject again. Every time I hear a liberal democrat proclaim to the nation that the Bush tax cuts caused the recession, I feel betrayed by the republicans who do not fight back with the facts. The lie needs to be challenged each time it is uttered by the Debbie w-Schultz types of the democrat party. Every time! Great work Heritage.

    56. michael mudrak says:

      We know tax cuts work. How many large corp. pay little or no tax at all. The whole system needs to be restructured
      the more gov. gets the more they want. I would like to see a flat tax of 10% and no deductions.

    57. michael mudrak says:

      We know tax cuts work. How many large corp. pay little or no tax at all. The whole system needs to be restructured
      the more gov. gets the more they want. I would like to see a flat tax of 10% and no deductions.

    58. Dave says:

      This is unbelievable – Its hard to recall when I last read so much Bull$#!t packed into a few paragraphs. You are disgusting

    59. scott trade says:

      just to stir the pot a little. does anyone think it's strange that for from 1945 to 1960 the top marginal tax rate was over 90%? this was one of the stongest the economy has ever been and it lasted for 15 years. also, does anyone ever wonder why there is such a large disparity between the top earners and the rest of the working class? Was the gap always this large? Is this gap good or bad for the economy? And just to play divils advocate a little more, since 1913 when the fed income tax was started, is there any clear evidence that cutting taxes on "job creators" leads to a stable economy as supply side theory would tell us? It seems to me that, the fact that the great depression came several years after massive tax cuts is slightly suspicios. it would at least give me a small pause when advocating for trickle down econ. and I wonder why we raised taxes right in the middle of the great depression too? wouldnt that have devastated our economy? hmmmmm…… but it didnt. in fact once the top tax rate was in the 90% range it stabilized our economy and led to massive increases in GDP. 15 years of it. just a few thoughts if you feel like stepping outside your little box for a minute and taking a look around.

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