Wehrwolfen
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- May 22, 2012
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White House Data Debunk Myth Bush Cuts Built Deficit
Paul Sperry @ IBD:
While President Obama insists the Bush tax cuts caused the recession and record deficits, his own economists say otherwise.
He might want to consult their data for the truth.
Kicking off fiscal cliff negotiations last month, Obama said: What Im not going to do is extend Bush tax cuts for the wealthiest 2% that we cant afford and, according to economists, will have the least positive impact on our economy.
During the White House press conference, he added, If were going to be serious about deficit reduction, weve got to do it in a balanced way.
Obama argued voters made it clear in the election that they dont want to go back to Republican policies that cost the Treasury revenues and blew up the deficit, as he told them repeatedly during the campaign.
The Washington media by and large share these assumptions. And theyre driving the debate over what to do about the federal budget crisis before Jan. 1, when the tax cuts and spending programs are set to expire.
But the assumptions are faulty, based largely on political demagoguery rather than hard numbers including ones certified by Obamas own fiscal policy advisers and bean counters in the White House.
Turn to Pages 411-413 of his 2012 Economic Report of the President, published by the Council of Economic Advisers. They show that the math, as Obama is wont to say, in fact does add up for tax cuts.
The post-tax-cut surge in economic growth and tax revenues helped drive down the deficit from 3.5% of gross domestic product in 2004 to 2.6% in 2005, to 1.9% in 2006 and to a manageable 1.2% in 2007.
Based on Bush fiscal policies, the nonpartisan Congressional Budget Office projected budget deficits of 0.7% to 1.5% of GDP for the years 2008 through 2011. The CBO even predicted surpluses for the subsequent years through 2018.
Read More:
White House Data Debunk Myth Bush Tax Cuts Exploded The Deficit - Investors.com
