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  • Sen. Gillibrand Accidentally Makes the Case for Bush Tax Rates

    Sen. Kirsten Gillibrand, D-NY, is determined to convince Americans that the Bush-era tax rates have directly resulted in job losses for New Yorkers. To that end, she recently published a series of bullet points purporting to show the effect of those tax rates on employment in nine regions of New York State.

    Her unspoken premise is that the economic benefits of the Bush tax rates should be judged based on the employment they did or did not produce. More generally, Gillibrand is assuming that the economic trends that follow a given policy can be fairly attributed to that policy – she’s assuming causation and dismissing correlation, in other words.

    With those implied premises in mind, here are the statistics that Gillibrand offered in a recent press release:

    Across the state, more than 330,000 more New Yorkers have gone unemployed since the Bush-era tax cuts for the wealthy were established…

    • In New York City, since the Bush tax cuts were enacted in 2001 there are approximately 150,000 more people unemployed.
    • In Western New York, since the Bush tax cuts were enacted in 2001 there are approximately 20,000 more people unemployed.
    • In the Rochester-Finger Lakes region, since the Bush tax cuts were enacted in 2001 there are approximately 20,000 more people unemployed.
    • In Central New York, since the Bush tax cuts were enacted in 2001 there are approximately 20,000 more people unemployed.
    • In Southern Tier, since the Bush tax cuts were enacted in 2001 there are approximately 9,000 more people unemployed.
    • In the Capital Region, since the Bush tax cuts were enacted in 2001 there are approximately 20,000 more people unemployed.
    • In North Country, since the Bush tax cuts were enacted in 2001 there are approximately 10,000 more people unemployed.
    • In the Hudson Valley, since the Bush tax cuts were enacted in 2001 there are approximately 40,000 more people unemployed.
    • On Long Island, since the Bush tax cuts were enacted in 2001 there are approximately 50,000 more people unemployed.

    At first glance those numbers look damning, but the key lies in the way Gillibrand frames them. Yes, there are more than 330,000 more unemployed Americans now than there were in June 2001, when the Bush-era tax rates went into effect. But quite a few things have happened since then: the largest terrorist attack in the country’s history, three overseas wars, and the worst economic slump since the Great Depression, to name a few.

    Controlling for the latter, we see that Gillibrand’s methodology – gauging the economic value of a policy based on raw employment numbers – shows the undeniable success of the Bush tax rates in creating jobs for New Yorkers.

    Statewide, and in every region Gillibrand mentions but one, overall employment increased from June 2001 to August 2008 (the beginning of the recession). During that period, according to data from the New York State Department of Labor,

    • Employment statewide increased by 559,400,
    • Employment in New York City increased by 273,500,
    • Employment in Western New York increased by 6,700,
    • Employment in the Finger Lakes Region increased by 3,300,
    • Employment in Central New York increased by 9,700,
    • Employment in the Capital Region increased by 33,500,
    • Employment in the North Country region increased by 9,300,
    • Employment in the Hudson Valley increased by 71,800,
    • Employment on Long Island increased by 86,400,
    • And employment in the Mohawk Valley Region, which Gillibrand neglected to include, increased by 6,300.

    The only region in which overall employment decreased during this period was the Southern Tier, which saw about 800 fewer people employed in August 2008 than in June 2001.

    In other words, assuming as Gillibrand does that the Bush tax rates were directly responsible for the state of the economy, measured by overall employment numbers, after their implementation, those rates in fact produced notable prosperity throughout New York State.

    Unless Gillibrand thinks it took seven years for those tax rates to have any effect on the economy, her statistics are meaningless, since they fail to account for the very obvious fact that unemployment has increased since late 2008 due to the massive economic downturn in which the country finds itself.

    If Gillibrand is really determined to judge a policy based on the raw numbers of employed persons in her state – rather than, say, the unemployment rate, which accounts for changes in the size of the workforce – then so be it, but doing so does not strengthen her case for raising taxes to pre-Bush era rates.

    Posted in Ongoing Priorities, Scribe [slideshow_deploy]

    7 Responses to Sen. Gillibrand Accidentally Makes the Case for Bush Tax Rates

    1. William says:

      This is sort of like saying "X million New Yorkers have died since the Bush tax cuts were enacted in 2001." Technically accurate but doesn't account for a few factors here and there…

    2. Daver says:

      You mean Bush didn't kill them?

    3. ricp24 says:

      First understand Sen. Gillibrand probably didn't write this breakdown; someone on Chuck Schumer's staff did! Gillibrand isn't allowed to answer a telephone without Schumer's permission. The only time you see her in the news she is about 7 steps behind Chuck in respectful stance, head down and hands folded in front of her! That is unless she's carrying papers for Sen Schumer. She is a JOKE, no one in upstate New York has heard from her since the day after Election Day 2010. If the GOP in NYS was a real opposition party they would run someone against her with a brain and run her out of office and back onto Andrew Cuomo's staff where she came from.

    4. Stirling says:

      This arguement that "Tax Cuts" cause more unemployment is the only spin that democrats can make since they are determined to undo the Bush era tax cuts (due to expire end of 2012).

      "The raw numbers of employed persons in her state" – is the same spin/manipulation that this administration is doing to the countries unemployment rate to make it seem lower (9.2) then the real (U6) rate (17+%)

      Sen. Kirsten Gillibrand is just sticking to her parties delusional version of Keynsian economics 101, which denies that any "Tax Cuts" have positive results.

    5. Rob says:

      Sophistry. Honest dishonesty. Can be applied to liberal statements daily.

    6. James says:

      Because the decrease in tax revenue from the middle class portion of the Bush era tax cuts was larger than the decrease due to the portion that went to the wealthy, shouldn't the Senator be blaming all this on the middle class? Just asking.

    7. Bobbie says:

      always looking to compare statistics that make the current administration look… commendable!!? But they don't and won''t look at the facts (except to twist and spin if anything) and/or specifics that brought the stats to be.

      Current administration won't admit the truth, let alone tell it. how disrespectful to Americans!! how shameful of these democrats and Gilligrand attempting misinterpretation for democrat as usual, disingenuous gain…

      Thank you Heritage, ALWAYS, for being on the side and sharing the truth!

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