One of the great legacies of the Bush Administration is further proof that tax cuts work. They stimulate the economy. They put people to work. They are a just-plain-good thing.
Now, the Bush Administration screwed up, and badly, by not cutting domestic spending. Those of us who supported Steve Forbes up until the end of the 2000 convention are justified in going “I Told You So”. And so we shall. But Bush’s tax cuts have given us an economy that, by any rational measure (except Lexus/Nexus hits) is one of the best ever.
Oh, the Democrats will barber than they starve the government of revenue – which, of course, exposes the central problem with their thesis; the role of our society is not to keep government afloat first and foremost.
The Dems have that wrong – aggressively so. And they want to “fix” that – to put government at what they call its’ rightful place in the fiscal food chain, way up front.
Jay Reding on the Dems’ plan to gut the US economy:
To [re-raise taxes] would be to erase the millions of jobs created in the past few years, introduce a huge amount of uncertainty into the market, and ensure that businesses would delay job-creating capital investments until they know what the tax consequences of those choices would be. The Asian markets had a massive sell-off because of similar fears, and the same would happen in America if there was a credible threat of a major capital gains tax increase…However, the worst thing that could happen is for the Democrats to raise taxes, spurring another selloff and then add more to the already burdened entitlement system. That is also precisely what the Democrats want to do — which is why the President should be prepared to veto any bill that raises capital gains taxes beyond the current level.
The economic reality is that capital gains taxes are economically wasteful — they don’t generate much revenue and they hurt economic growth, reducing tax revenues in other areas. Even if a 0% capital gains rate isn’t politically acceptable, neither is a return to a time when capital gains rates were acting as an anchor on economic growth.
It’s here, again, that elections matter. It’s here that we pay for having the likes of Amy Klobuchar and Tim Waltz in Congress; their philosophy is “government comes first”.