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Monday, February 16, 2009

Judd Gregg Thinks Tax Cuts Pay for Themselves

I'm really glad that someone who believes tax cuts pay for themselves - as Judd Gregg believes - won't be our next Commerce Secretary:

Bush Tax Cuts, by Judd Gregg, May 15 2007: ...I want to pick up where the Senator has left off. The Senator talks about the facts--and this is a fact--that revenues to the Federal Government have jumped dramatically in the last 3 years. In fact, in the last 3 years we have seen more revenues flowing into the Federal Government than ever in history...

Why have we gotten more revenues even though we reduced the tax burden on the American people? The answer is pretty simple. It is called human nature. When you set tax levels at a fair level ... people are willing to go out and invest. ... They are willing to work harder... That creates a stronger economy which puts more people to work, and..., of course, the more jobs you have the more tax revenues you end up getting. ...

In fact, in the area of capital gains, we have seen a dramatic increase in revenues. ... It is a huge jump in revenues we didn't expect--or at least the Congressional Budget Office didn't expect--but which we received because human nature kicked in and people were willing to sell assets, take that money and reinvest it in things that are productive, create jobs, and as a result we got those revenues. That is why today the Federal Government is actually getting more in revenues than it got under the old tax law where the rates were a lot higher. ...

I think we need to ... see what has happened as a result of reducing these tax rates. Basically, what has happened is that even with the lower tax rates today, wealthy people are paying more in revenues to the Federal Government than at any time in history. ... So even though we have cut rates, we have actually created more revenues from high-income individuals. ...

Higher taxes, actually, in many instances reduce revenues to the Federal Government... Three Presidents have proved beyond any reasonable doubt when you lower income tax rates, you generate economic expansion... President Bush has shown it once again: Cut income tax rates, expand the economy, and as a result get a fair tax level and human nature kicks in and revenues flow into the Federal Treasury. ...

Unfortunately, though, we now have the Democrats presenting to us a budget which wants to take us to the French path, which essentially is going to dramatically increase the cost to the Federal Government, to Americans, and as a result dramatically increase the tax level on Americans. We will go down that path that France has gone down.

I have to tell you, it doesn't work in France. Productivity is not up in France. Jobs are not being created in France. People don't want to go out and work harder in France. ...

I think we should reject the Democratic approach under their budget of raising taxes and stay with this tax law that is raising so much new revenue...

Who in the administration thought Gregg would be the best person available "to foster, promote, and develop the foreign and domestic commerce" when he believes ideological nonsense like this?

    Posted by on Monday, February 16, 2009 at 05:40 PM in Economics, Politics, Taxes | Permalink  TrackBack (0)  Comments (75)

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