There is little that sets me off like an attempt to deceive. That probably explains my constant wrath directed at politicians and the political arena, used car salesmen, etc. Today I have to correct an attempt to deceive that's being played and played again. I don't know if America suffers from short term memory loss, or if we just are so apathetic we don't care to remember but I have to address this.
Our President has toured the country spouting his plan for recovery. He demeans the opposition by pointing his finger back to the Bush Presidency and proclaiming we don't want to go back to the failed policies that got us here in the first place. All he's proposing is to return to the tax rates that were enacted during the Clinton Administration where we had the a balanced budget.
First a disclaimer, I love balanced budgets! But truth be told, Clinton's prosperity was waning as he left office because the dot com, and tech bubble had burst. We were entering a recession as President Bush took office. Just because President Bush didn't assign blame and squeal like a pig about what he inherited, didn't mean it didn't exist. Another factor was President Clinton enjoyed peacetime prosperity, it's easier to balance a budget without wars to fund during your administration. The economy was heading into the tank. Enter 9/11 and bad just got worse. The tax cuts inspired business to roll up it's sleeves and employ more people. Interest rates dropped significantly, and the housing bubble began. (Please note here that both presidencies experience prosperity because of a bubble). Bubbles are designed to burst, and they both did. The difference was, the dot com/tech bubble only benefited people with the tech skills able to create within that sector. The housing bubble was enjoyed by anyone who could sign their name, as credit was readily available to anyone breathing. You never saw any shows on TV during the Clinton Administration telling you, you could "Flip this Internet program!" It required a special skill and training to prosper from the boon, not so much the housing bubble. Both saw unemployment drop, both allowed America to prosper for a short period of time. Neither bubble was affected by taxation, so tax rates were not a factor in those prosperous times.
What taxes did have in common with both bubbles is as personal revenue rose, so did the Federal government's intake of tax dollars. The only common denominator between taxes and increased tax revenue is higher GDP. So to lower the deficit, balance the budget, and increase the cash flow to the Federal government, we need to raise the GDP. (Sell more good and services). Nothing else affects tax revenue! Let me repeat, nothing else affects tax revenue! Not taxing the wealthy, not giving tax cuts to the poor, not giving tax cuts to the middle class, just enact policies that spur business to go full throttle.
Just a little side note here..We are currently taking in more tax revenue than in any other time in history. Tax income is not the problem, spending is. But this Blog isn't about spending, it's about the alteration of history, and the misleading of the American public. You cannot change the fact by speaking something counter to the truth into existence. FDR's policies were a failure, Clinton was no more prosperous than Bush, and there is no Easter Bunny. What is written above is historical fact, not meant to make excuses for anyone, just designed to inform so you can base your opinion on the truth. Let me refresh....
Clinton had peacetime prosperity, the dot com/tech bubble fueled that boon. It was limited to those who had knowledge of the industry. The budget was easier to balance without war. He left office with the nation in economic decline.
Bush had wars to fund. His prosperity met or exceeded Clinton's. It was fueled by a housing bubble that the whole nation could participate in. He also left office in economic decline.
Tax rates had nothing to do with either's success and decline. Tax revenue is only tied to the rise and fall of GDP. GDP goes up, tax revenue increases no matter what the tax rate. GDP goes down, tax rates decline no matter what the tax rate. The key to increasing tax revenue is to inspire business to produce and sell more. This hires more workers, raises the tax base, and increases revenue to the government. Simply cut spending below intake of revenue, and you have a balanced budget. This is how you operate a nation in an economically sound manner!