House Speaker John Boehner said again this week, tax increases are off the table. He and Senate Minority Leader Mitch McConnell have used the same language hundreds, perhaps thousands of times. You can't tax the job creators in a recession, they say. They pound it home time and again. It's the wealthy who create jobs in America, leaving the clear implication they're defending tax cuts for the wealthy and for corporations because it's good for America.
McConnell and Boehner either have very incompetent staffs or they are deliberately misleading American voters.
There is in fact no clear evidence that tax cuts for the wealthy create jobs. The non-partisan Congressional Budget Office last year analyzed fourteen approaches to creating jobs in America. Tax cuts for the wealthy came in 14th -- dead last.
Some Republican spokesmen say that history proves them right, arguing that Ronald Reagan cut taxes and had job gains in his administration. They don't mention that after Reagan cut taxes, he raised them again.
The most obvious comparison is of course the eight-year administrations of Bill Clinton and George Bush. Clinton had a tax rate of 39 percent and created some 22 million jobs during his administration. He left George Bush with a surplus and a roaring economy.
Bush's first move was to use the surplus as an excuse to drop tax cuts to 35 percent for the richest Americans. There is no doubt this was good for the rich who from 2001 to 2007 increased their assets by 10 percent every year. During that same period middle Americas actually lost eight percent of their net assets. And importantly, in 2008 and 2009, the last years when Bush policies were in full effect, America lost a total of 8 million jobs.
Higher taxes under Clinton and a net gain of 22 million jobs. Reduced taxes under Bush and a two-year loss of 8 million jobs. How does this equate into lower taxes being good for America?
In addition, recent studies using CBO figures estimate that six trillion of our current debt stems from the Bush tax cuts in 2001, 2003 and 2004.
McConnell and Boehner know the above figures quite well. They have good staffs as befits their important roles. But telling the truth about taxes would not suit their political agendas.
Republicans leaders for the last 30 years have promoted lower taxes for three main reasons, each interlinked. First, Republicans do believe in lower taxes. This goes with their theories about smaller government and with their distaste of such programs as Medicare and social security. Second, it is the very rich and corporations who contribute the most to Republican politicians. It is circular giving for the rich and corporations get substantial largess from the government in many forms -- contracts, advantageous government policies, etc. Third, the beneficiaries of Republican tax benefits are well organized and well funded.
The Club for Growth and Americans for Tax Reform are two corporate funded groups based in Washington that in effect monitor Republicans on tax policy. The ATR boasts openly that it extracts pledges from members of Congress that they will never vote for any sort of tax increase. ATR says it has over 40 pledges from senators and more than 200 from representatives. Failure to follow the pledge has often meant well-funded primary opponents.
Politicians like Boehner and McConnell know full well the implications of their no new tax policy. But sadly, like so many politicians like them, they put power and money above the inter of the average American. And they don't stop for a moment in deceiving Americans in their pursuit of their political goals.
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