BRAVO JEM! Dear Free Loader: I've seen several of your posts and you haven't won an argument yet. Keep trying, I'm still rooting for you (I hire the handicapped because they're fun to watch). By the way, I wrote this post very slowly because I know that you can't read very fast and are even slower when it comes to comprehension. Perhaps Obama-Care will provide you with a brain transplant. Good Luck with that.
The role of Bush tax cuts in the deficit A review of data from the White House Office of Management and Budget shows that tax revenues did not consistently increase after the Bush tax cuts went into effect. In FY 2001, tax revenue in dollars was $1,991.1 billion. For FY 2002 - the first budget of the Bush administration, which went into effect after President George W. Bush signed tax cuts into law in June 2001 - revenue dropped to $1,853.1 billion. Bush signed two more tax cuts into law over the next two years. In FY 2003, revenue dropped further, to $1,782.3 billion - about a 10-percent reduction from two years earlier. This drop in tax revenue occurred even as economic activity - the nation's GDP - was continually rising, according to Bureau of Economic Analysis data. Revenues then increased for four years - from $1,880.1 billion in FY 2004 to $2,568 billion in FY 2007 - before sliding to $2,524 billion in FY 2008, and then dropping further to $2,105 billion in FY 2009 as the recession exploded. Source Data: White House Office of Management and Budget - Historical Tables As a percentage of gross domestic product, the amount of tax revenues as a part of the economy has also varied widely, though it is still less today than in FY2001, when it represented 19.5% of GDP. It has dipped from as low as 16.1% in FY2004, to as high as 18.5% in FY2007, before finishing out FY 2009 at 14.9% - its lowest level since 1950 (14.4%). It is true when Sen. Sessions said spending has increased every year from FY2001 - the last year the government spent less than it took in. In FY2001 spending was $1,862.8 billion; by FY2009 spending was at $3,517.7 billion - more than $1.4 billion more than what was collected in taxes. Analysis by Citizens for Tax Justice claims that the Bush era tax cuts resulted in $1,918.9 billion in lower revenue from FY2001 through FY2009, and that the total cost if implementing the cuts (including interest payments on debt) was $2,141 billion. http://www.cbsnews.com/8301-3460_162-20078242.html
Whether revenue should play any role in deficit reduction is at the root of the fiscal impasse between Congressional Republicans and President Obama. One factor underlying the hard-line Republican position that taxes must not be increased by even $1 is their assertion that the Bush tax cuts played no role in creating our deficit problem. In a previous post, I noted that federal taxes as a share of gross domestic product were at their lowest level in generations. The Congressional Budget Office expects revenue to be just 14.8 percent of G.D.P. this year; the last year it was lower was 1950, when revenue amounted to 14.4 percent of G.D.P. But revenue has been below 15 percent of G.D.P. since 2009, and the last time we had three years in a row when revenue as a share of G.D.P. was that low was 1941 to 1943. Revenue has averaged 18 percent of G.D.P. since 1970 and a little more than that in the postwar era. At a similar stage in previous business cycles, two years past the trough, revenue was considerably higher: 18 percent of G.D.P. in 1977 after the 1973-75 recession; 17.3 percent of G.D.P. in 1984 after the 1981-82 recession, and 17.5 percent of G.D.P. in 1993 after the 1990-91 recession. Revenue was markedly lower, however, at this point after the 2001 recession and was just 16.2 percent of G.D.P. in 2003. The reason, of course, is that taxes were cut in 2001, 2002, 2003, 2004 and 2006. It would have been one thing if the Bush tax cuts had at least bought the country a higher rate of economic growth, even temporarily. They did not. Real G.D.P. growth peaked at just 3.6 percent in 2004 before fading rapidly. Even before the crisis hit, real G.D.P. was growing less than 2 percent a year. http://economix.blogs.nytimes.com/2011/07/26/are-the-bush-tax-cuts-the-root-of-our-fiscal-problem/ Few people remember that a major justification for the 2001 tax cut was to intentionally slash the budget surplus. President Bush said this repeatedly during the 2000 campaign, and it was reiterated in his February 2001 budget document. In this regard, at least, the Bush-era tax cuts were highly successful. According to a recent C.B.O. report, they reduced revenue by at least $2.9 trillion below what it otherwise would have been between 2001 and 2011. Slower-than-expected growth reduced revenue by another $3.5 trillion.
Its as basic... to any logical person. If 4 times in recent past A (tax cuts) and B (increased spending) gets Cs (increase in economy and tax revs) And this time B alone is not resulting in C. Lets add in A and anticipate C again.... like the last 4 times. if that does work... lets eliminate personal income tax because we know that will work.
EFFECT OF REAGAN, KENNEDY, AND BUSH TAX CUTS ON REVENUES EFFECT OF REAGAN TAX CUTS ON REVENUES - SHORT ANALYSIS The argument that the near-doubling of revenues during Reagan's two terms proves the value of tax cuts is an old argument. It's also extremely flawed. At 99.6 percent, revenues did nearly double during the 80s. However, they had likewise doubled during EVERY SINGLE DECADE SINCE THE GREAT DEPRESSION! They went up 502.4% during the 40's, 134.5% during the 50's, 108.5% during the 60's, and 168.2% during the 70's. At 96.2 percent, they nearly doubled in the 90s as well. Hence, claiming that the Reagan tax cuts caused the doubling of revenues is like a rooster claiming credit for the dawn. Furthermore, the receipts from individual income taxes (the only receipts directly affected by the tax cuts) went up a lower 91.3 percent during the 80's. Meanwhile, receipts from Social Insurance, which are directly affected by the FICA tax rate, went up 140.8 percent. This large increase was largely due to the fact that the FICA tax rate went up 25% from 6.13 to 7.65 percent of payroll. The reference to the doubling of revenues under Reagan commonly refers to TOTAL revenues. These include the above-mentioned Social Insurance revenues for which the tax rate went UP. It seems highly hypocritical to include these revenues (which were likely bolstered by the tax hike) as proof for the effectiveness of a tax cut. Hence, what evidence there is suggests there to be a correlation between lower taxes and LOWER revenues, not HIGHER revenues as suggested by supply-siders. There may well be valid arguments in favor of tax cuts. But higher tax revenues does not appear to be one of them. EFFECT OF BUSH TAX CUTS ON REVENUES AND GDP There have been three major tax cuts under Bush. Briefly, the 2001 tax cut created a new 10% individual tax rate and phased in the lowering of individual tax rates. It also phased in an increase in the child tax credit, marriage penalty relief provisions, an increase of the estate tax exemption, an increase in the IRA contribution limit, and the repeal of limits on itemized deductions and personal exemptions. The 2002 tax cut was chiefly aimed at business, creating 30% expensing for certain capital asset purchases, extending the exception under Subpart F for active financing income, and increasing the carryback of net operating losses to 5 years. Finally, the 2003 tax cut lowered the top individual income tax rate on dividends and capital gains and accelerated most of the phased-in provisions of the 2001 tax cut. For a more complete description of the tax cuts, see page 14 of Revenue Effects of Major Tax Bills. As mentioned above, the real growth in individual income tax receipts was 5.77% from 1998 to 2008 and -19.36% from 1999 to 2009. These are the lowest growth rates of any of the 60 10-year spans from 1940 to 2009. However, these two spans begin before the initial Bush tax cut in 2001. Hence, it may be better to look at a shorter time-span to try to judge the effects of the Bush tax cuts. A good choice might be eight years as this would cover the span from the year of Clinton's last budget (2001) to the last year for which there is actual data (2009). The growth of receipts by source, outlays, and GDP over every 8-year period since 1940 is shown in the following graph: http://www.econdataus.com/taxcuts.html The actual numbers and sources can be found at recgro8y.html. As can be seen in the second table and graph, real individual income tax receipts declined 25.06% from 2001 to 2009. Even total receipts declined -13.93% over that period. Finally, real GDP grew just 13.36% from 2001 to 2009. This was the lowest real GDP growth over any 8-year span since 13.33% from 1966 to 1976. Hence, although it's been just about eight years since the 2001 tax cut and six years since the 2003 tax cut, the evidence to this point is that the Bush tax cuts decreased revenues over what they would have been, at least over the short term. This was true even in my prior analysis based on data through 2007, before the financial crisis of 2008.
you keep bringing up this statist bullshit about taxes as a percent of gdp... and in some crazy manner you want that to be larger. I can see you arguing for more tax revenue... but larger percent of GDP... that is communist. We now spend 2.43 dollars of debt for a new dollar of GDP. we need more jobs and stronger economy... that will raise tax revenues to new highs. then we want to make govt a smaller share of gdp... that will keep our economy growing.
Clear, concise and well stated. Unfortunately you'll need to speak in more convoluted terms in order to get your point across.
All that talk does not matter to the logic. (And you got the entities wrong, anyway.) If tax cuts then revenue increases. Revenue increased. Therefore there were tax cuts?