Does anyone remember Reaganomics? For those of you born during the Clinton administration I’ll fill you in. When Ronald Reagan was in office, he dramatically cut the marginal tax rates across the board. During his tenure in office, he reduced the top marginal tax rate from a staggering 70% to only 28%.The theory behind such a move is simple: It’s the corporations and wealthy business owners that employ the working class Americans. If the top rates are reduced, there will be more money to grow businesses and expand the economy, more people will be working, and revenue to the government will actually increase. This “trickle down” effect earned his strategy the nickname, “trickle down economics.” Critics called it, “voodoo economics”, a term ironically coined by George H. W. Bush.
Did his strategy work? Oh yes! It worked big time. Americans enjoyed the nation’s longest, peacetime expansion of the economy in US history. And revenue to the Federal government went from just over 500 billion in 1980 to over 1 trillion in 1990!
Needless to say, liberals despised it. Liberals see the tax code as a tool for social engineering. The idea that wealthy people actually got to keep their own money is completely contrary to their socialistic tendencies – er – I mean, ideas of “fairness.” They vilified Reagan and his plan in every way they could imagine and still do so today. It’s class warfare in the extreme. How many times during this presidential campaign did we hear Obama ramble on about McCain’s “tax cuts for big oil” or “tax cuts for the wealthy”?
But they loved spending the money though! They spent money like sailors on leave. And even though tax receipts doubled during the ‘80’s, spending went up exponentially and the nation had even higher deficits than before.
Now, fast forward to today. What is all this talk about bailouts? Why are we forking out hundreds of billions of dollars to prop up failing businesses? Fannie Mae, Freddie Mac, and AIG are “big business” by anyone’s definition. Now we’re talking about $25 billion for the big three automakers too!
Could someone please explain to me the qualitative difference between letting big business keep more money via tax cuts and writing a government check to big business? The only difference I see is that the government gets to attach a boat-load of strings when it writes the check.
I’m sorry to point it out to these Dem’s but this is a great big “gotcha”! You’ve known all along that it’s “big business” that drives the economy. When we help the lenders, it helps the borrowers. When we help the automakers, it helps the workers. The economy grows, revenue grows, and everybody is happy
Psst, Congressman Frank… your hypocrisy is showing.
Growing up my immediate family never talked about religion or politics. Needless to say I grew up not knowing much at all regarding politics.
ReplyDeleteIn college I took a class on Reaganomics - however looking back now I realize the professor was definitely liberal. What I learned in that class and what I've come to realize now about that time period and about Reagan are in stark contrast with one another.
It is amazing to me now to realize how many lies I was fed in college and how I had no idea what I was buying into at that time.