Whenever Republicans – or anyone else – propose a tax cut, Democrats run to the nearest microphone in horror crying about all the revenue it will "cost" the federal government. Panicked Pols will foretell of massive firings of teachers and policeman, children will starve because school lunches will disappear, and condoms and birth control pills will vanish from Planned Parenthood stock rooms.
Such is the case in these waning days of the 2012 presidential campaign as Barack Obama and Joe Biden rail against the Romney-Ryan plan to lower the tax burden on Americans. It's not just that Mitt and Paul believe everybody in America could use some relief. They also know that history has proven time and again that lower tax rates are a proven stimulus for increased economic activity which produces more, not less, revenue for the US Treasury as the following chart demonstrates.
Reprinted from IBD: October 18, 2012
Not only do Obama and Biden deny historical fact with their opposition to Romney's plan, they pretend that restoration of economic vitality is somehow just one more big tax increase away. Their plan – already rejected by even by many Democrats in Congress, by the way – would raise taxes for the handful of folks at the top of the income ladder; many of which are small business owners.
In a front page feature for Investor's Business Daily for Tuesday, October 18, 2012 Paul Sperry does a terrific job of explaining the historical financial realities that happened with when tax rates were both increased and decreased across time by Democrats and Republicans from the Kennedy Administration through George W. Bush.
Obama and Biden would do well to study and understand this indisputable piece of American history. But, then their objective isn't really to fix our economy; it's all playing class warfare in the hope of eeking out re-election.
In his opening few paragraphs Sperry writes:
President Obama warned that GOP hopeful Mitt Romney's proposed income-tax cuts will "cost" the government revenue and repeat Bush policies that he says blew up the deficit.