What part of “the 2003 tax cuts are working” do Democrats not understand? Democratic Congressional leaders and the flaming liberal media are already beating the drum of rolling back President Bush’s 2003 tax cuts, even more tax increases to pay for rebuilding the Gulf Coast and aiding victims of Hurricane Katrina. They are either economically illiterate or intentionally deceiving the public.
When Senator Hillary Clinton (D-NY) was recently asked where the money should come from to pay for reconstruction efforts, she stated, “It comes from the first instance in not making those tax cuts for rich people like us permanent.” This is the same economic genius who last year told supporters at a San Francisco fundraiser, “We’re going to take things away from you on behalf of the common good.”
Let’s review the positive impact of the 2003 income, capital gains and dividend tax rate cuts on our current economy. GDP has increased for 15 consecutive quarters. The economy has added nearly 4 million jobs in the past 26 months. Unemployment is at 4.9% - the lowest level since September 2001, and lower than the decade averages of the 1970s, 1980s and 1990s.
Senator Joe Biden (D-DE) said of paying for recovery from Katrina, "We're either going to share the cost with everyone, including the wealthiest among us by foregoing the tax cuts for the wealthiest, or we're going to put all the burden on the middle class. We don't have to go forward with further tax cuts for the wealthy.”
Senator Biden, the wealthy already pay the vast majority of income taxes. In fact, those in the top 20% of income currently pay 80% of all taxes. Additionally, nearly 8 million low and middle-income families have seen their entire tax liabilities completely eliminated by the 2003 tax cuts.
Even former president Bill Clinton couldn’t resist politicizing the Katrina disaster to deceive the public. On making the tax cuts permanent, President Clinton stated that Democrats “Should continue to oppose it, and they should make it an issue in the 2006 election, and they should make it an issue in the 2008 election. I think it's very important that Americans understand... tax cuts are always popular, but about half of these tax cuts since 2001 have gone to people in my income group, the top 1 percent. I've gotten four tax cuts. They're responsible for this big structural deficit, and they're not going away, the deficits aren't."
In reality, Mr. Clinton, the federal budget deficit is dropping thanks to record increases in individual and corporate tax revenues. The Office of Management and Budget projects a fiscal year 2005 deficit 36% lower than the 2004 deficit.
Of course, these slick-talking politicians are not economically illiterate – they are intentionally deceiving the public. They can not argue against the fact that tax rate cuts have benefited our entire country, so they are using the opportunity of a horrific natural disaster to push their dream of a socialized economy on America.
The last thing Congress should do now is take money out of the pockets of hurricane victims starting to rebuild their lives, or out of the pockets of people already working on driving this positive economy. Cutting tax rates is not rocket science – it is economic common sense. When people have more of their own money, they spend more, save more, invest more and donate more. More government spending of our tax dollars is not the solution, it is the problem.
Our elected officials in Congress must stop picking winners and losers with the tax code and fattening their favorite constituencies at the pork trough. Congress should be considering ways to supercharge the economy so everybody wins. Making the 2003 tax cuts permanent and eliminating the death tax would be a good start. Totally replacing the income tax code with a national consumption tax would be a game-changing and game-winning economic touchdown for all U.S. citizens.
When an idea such as replacing the income tax code with a consumption tax is brought before Congressional Democrats and even some Republicans the response is usually to the effect of, “That’s too big of a bite for Congress to do all at once.” Let me get this straight. Natural disasters hit us in big bites. Terrorists hit us in big bites. Social Security and Medicare are going to hit us in big bites in a few short years. Yet Congress wants to nibble around the edges of protecting us from an economic disaster that will make Katrina look like a picnic in the park.
Congress does not act until there is a crisis, and even then it is usually a weak or knee-jerk reaction. In the coming economic crisis Congress will not be able to send a few truckloads of taxpayer dollars to save us, and we can not rebuild our economic infrastructure with loans from our enemies. Congressional Democratic leaders are preaching deceptive economics because they think their blind followers – informed through their puppet mainstream media – are economically stupid.
Republicans would be wise to use this opportunity to show common sense economic leadership. They would also be wise to stop underestimating the intelligence of most voters to understand that Democrats are attempting to force us into economic collapse. If Republicans don’t lead, while Democrats continue to deceive, the next generation will not be able to recover from the damage caused by hurricane-sized spending and disastrous tax increases.