Thursday, August 30, 2007
U.S. News: Can Republicans Explain Why Higher Taxes Are Bad?
Can Republicans Explain Why Higher Taxes Are Bad?, by James Pethokoukis:
The Republican presidential candidates seem to be assuming that their Democratic rivals are going to push for repeal of all the Bush tax cuts. That's why they are always talking about a potential $2 trillion-plus tax hike when those reductions expire at the end of 2010. More likely, Democrats will call for only the tax cuts on wealthier Americans to be repealed—such as raising the top rate from 35% to 40%—and for keeping most of the middle-class tax cuts, including rate reductions and a higher child tax credit.
So Republicans will have to explain why a tax hike on "the rich" is a bad idea that will hurt average Americans. Making that task more difficult is the fact that many Americans probably associate the 1990s with an economic boom despite—maybe even because of—the Clinton tax hike in 1993. I have yet to hear any GOP contender really address this issue.
Update: Linda Beale (Wayne State) has more here.
https://taxprof.typepad.com/taxprof_blog/2007/08/us-news-can-rep.html
Comments
The only problem I see in your analysis, Dewey, is that it has to be smushed into a 15 second sound bite and heard over soaring patriotic music and in competition with a soft focus frame of the candidate holding hands of a diverse, multicultural happy group of people.
On the other hand, the argument FOR an increase in tax just needs five fat white guys in vests and gold fobs chewing cigars and laughing uproariously at some 12 year old kid working in a coal mine.
Posted by: guy in the veal calf office | Aug 30, 2007 5:52:21 PM
The population of this country is growing. Every year more people graduate from college and are looking for a job. Even more graduate from high school and those that do not go to college are looking for a job. The creation of those jobs requires investment and the higher the tax rate, the less money there is for investment, the fewer jobs are created. We tried having the government create jobs with the WPA and the CCC and it didn't work. The only way to possibly create those jobs is to make more money available for investment. That doesn't happen when taxes are raised.
It has been proven that lowering taxes increases government revenues so getting more revenue is not the reason for wanting to raise taxes.
Now that we have the financing for the new jobs we need to find a market for the products or services those recent graduates will produce. In other words, we need to compete in the global marketplace. Here again taxes have a great impact. So long as we tax labor we embed those taxes in the price of the product placing ourselves at a disadvantage against other countries with other tax systems.
Posted by: Dewey | Aug 30, 2007 6:23:32 AM
Any politician who argues for higher taxes on "the wealthy" -- and please consider whether the government has any business deciding who is "wealthy" and who is not -- is advocating wealth transfers, from those who have more to those who have less, to buy votes from the recipients of this largesse. I thought we took steps to do away with this sort of blatant vote-buying in 1776, or, if not then, 1787.
Posted by: Jake | Aug 30, 2007 8:11:24 PM