Saturday, September 25th, 2010
Stephan: I think part of the problem in our public discourse is that the difference between actual facts, and ideology has become hopelessly blurred. In fact we have the social science now to evaluate what works on the basis of data, not ideology. Here is an example. Unless someone can offer a countervailing body of data, which I think unlikely, I take it that the Bush tax cuts, and the tax cuts being proposed now by Republicans, have been proven to be a failed theory through experimentation. The conversation should move on.
David Cay Johnston is a Tax Notes columnist. The Washington Monthly calls him 'one of the country's most important journalists' and the Portland Oregonian says his work is the equal of Ida Tarbell, Upton Sinclair and Lincoln Steffens. At The New York Times, Johnston received a 2001 Pulitzer Prize for exposing tax loopholes and inequities. He now teaches the tax, property and regulatory law of the ancient world at Syracuse University College of Law and Whitman School of Management. He is the author of two bestsellers on taxes, Perfectly Legal and Free Lunch. His next book, The Fine Print, will be published in 2011.
(Click through to see the actual tables.)
The 2008 income tax data are now in, so we can assess the fulfillment of the Republican promise that tax cuts would produce widespread prosperity by looking at all the years of the George W. Bush presidency.
Just as they did in 2000, the Republicans are running this year on an economic platform of tax cuts, especially making the tax cuts permanent for the richest among us. So how did the tax cuts work out? My analysis of the new data, with all figures in 2008 dollars:
Total income was $2.74 trillion less during the eight Bush years than if incomes had stayed at 2000 levels.
That much additional income would have more than made up for the lack of demand that keeps us mired in the Great Recession. That would mean no need for a stimulus, although it would not have affected the last administration’s interfering with market capitalism by bailing out irresponsible Wall Streeters instead of letting the market determine their fortunes.
In only two years was total income up, but even when those years are combined they exceed the declines in only one of the other six years.
Even if we limit the analysis by starting in 2003, when the dividend and […]
