Taxes Made this Country Great; Taxes Cuts Weakened It

 In the early 1980s, Ronald Reagan had this "great" idea -- cut taxes for everyone, especially the wealthy. The theory was that the benefits of those cuts would "trickle-down" to everyone and the economy would prosper and pay for the cuts. 

Reagan was wrong. The economy went nowhere and the deficit was out of control.  (Of course, the wealthy were happy because they were paying less than their fair share of the cost of running a democracy.) In 1982 Reagan had to raise taxes and did so throughout his presidency. David Stockman, Reagan's director of the budget and architect of trickle-down theory (their fancy name for it was "supply-side economics.") later admitted it was a failure and equated it to filing for bankruptcy.

But that didn't stop the Republicans. In 2001 and 2003, George W. Bush passed a tax cut, and once again, it was to fire up the economy and therefore would pay for itself. And it was no surprise that he was wrong. The result was Bush's Great Recession and the wealthy were paying even less in taxes.

It is worth noting that in between Reagan and George W. Bush was Bill Clinton who in 1993 passed a tax increase to reduce the deficit. Republicans were predicting disaster for the economy. Once again, they were wrong. The economy flourished and the deficit turned into a surplus for four straight years.

And then in 2016 Trump was elected with a minority of the popular vote and in 2017 the Republicans were back with their same dog-and-pony show. Their large donors wanted their reward -- another tax cut for the uber-wealthy and huge corporations.

So how do the Republicans justify these tax cuts for the rich and corporations? They claimed that business investments would "skyrocket." The fact is: "... the growth rate for new orders began declining immediately after the tax cut was passed, reaching zero in late 2018 and falling into negative territory in mid-2019."*

Trump and his "team" told us the GDP would increase by 6 percent and the tax cut would pay for itself. The growth boom never happened. Corporate tax receipts fell by 40% after the tax cut and the deficit is skyrocketing. Wrong again.

The GOP also promoted the tax cut as "a jobs bill".  Fact: the share of the population with jobs continued on the same track as it had since the Great Recession. No spike after the tax cuts. They promised workers' wages would somewhere between $3000 to $9000. Didn't happen. But corporate profits skyrocketed.

And the biggest scam of all was they said they were cutting taxes for everyone. However, the tax cuts for the middle class were temporary while those for the wealthy will continue.

During every recent election cycle, Republicans bring out their old, disproven tax cut dog-and-pony show and every time there are gullible taxpayers who end up voting against their best interests.

Tax cuts for the sake of tax cuts is a fool's policy. This has been going on for too long. Our country's tax policy is a mess. Then, on top of it all, the Republicans continue to defund the IRS so that our agents do not have the resources to collect from the wealthy and corporations and therefore go after the middle and lower class citizens.

Perhaps in this election voters will see the scam. Trump is now talking about another round of tax cuts while our national debt has exploded. Will voters in 2020 recognize the con when they see it? Let us but hope.

*This quote and the statistical support for the claims in this blog can be found in  Kevin Drum's "Death and Taxes" in Mother Jones July/August 2020.