Ronald Reagan was vilified (Oddly enough, by the current President's own father) as a practitioner of "voodoo economics" for daring to propose that tax cuts would spur the economy. Except that after the tax cuts kicked in, the economy boomed. And boomed for a long time, too. Sadly, Congress kept spending. Bush and then Clinton raised taxes to help cover the enormous spending. Clinton's tax increases were truly enormous and included a retroactive tax increase – the first one ever. Then Congress changed hands and it became difficult to spend wildly. Deficit reductions resulted. But, by the end of the Clinton years, a recession had started.
The current President undid a lot of the massive tax increases that happened in the Clinton years. And the economy boomed again. Then came 9/11. The economy was shaken, and it's taken some time to settle. We've been in a war for a while now and deficits have climbed. Because, sadly, Congress has kept spending. But still, the favorable tax climate has led to a lot of growth. Even though you can hardly hear it in the MSM, the economy has been doing rather well.
Now comes news that April of this year was the second highest total tax income month in US history. Want proof that cutting taxes actually raises tax revenue? Just look.
I live next to a state that keeps raising taxes. Every time they do so, their total tax revenues fall. They simply do not get it. People cross the border to this state to spend rather than pay the high taxes. They are scrambling to keep young people in their state because, right now, many young people are leaving. For states with less draconian taxation.
UPDATE: I see Daou Report has linked again. Please read the comment policy here. Personal slurs will be deleted.
UPDATE: I took a lot of grief here from the folks who traveled over when Daou linked. Look at this and tell me why I'm wrong again?
Again, one data point does not an analysis make. Of course there are a lot of factors.
Gaius,
You keep making that “one data point does not an analysis make”, but the fact is that you don’t have any data points at all to make your original claim.
“The economy boomed” in Bush’s first eight months? I don’t think so. Average unemployment in Bush’s first year was higher than in Clinton’s last year, and GDP increased by a mere 0.8%, compared to 3.7%
Unemployment went down every single year of Clinton’s presidency. That hasn’t happened with any other post WWII President. In Bush’s first four years GDP grew an average of 2.3% per year, compared to Clinton’s average of 3.7%. Clinton didn’t have a single year with GDP growth as slow as Bush’s average through four years.
So the tax increases in Clinton’s term didn’t seem to hurt the economy much.
I also find it amusing that you’re quick to refer to “Reagan tax cuts”, “Bush tax cuts”, and “Clinton tax increases”, but also want to foist Reagan’s huge deficits onto Congress. A little consistency would be most welcome.