Bush’s Tax Cuts For the Rich: Destroying Our Revenue Base, Harming Our Economy
The drive to reclaim George W. Bush’s economic record has begun sooner than we thought.
The new right-wing talking point we’ve been hearing on talk radio, on Fox and in certain blogs is that the Bush years “generated record revenues.” This, despite the fact that the man had eight years to take surpluses as far as the eye could see and turn them into eight straight years of deficits.
Of course, this is nonsense. The Bush tax cuts absolutely reduced revenues and increased deficits over the course of President Bush’s tenure in office. Revenue actually fell during the Bush years in real dollars, which is shocking, because it’s the only time that’s happened in the past 60 years. Combine that with trying to fight two wars on the cheap, and you have the root cause of our country’s deficits. Dismantling our revenue base effectively dismantles the engine of our economic prosperity.
It’s not a coincidence that demagogues are pushing this line now. Bush’s tax cuts for the wealthiest Americans are about to expire, and supporters of ensuring that the rich keep getting richer at the expense of everyone else have decided that it’s time to abandon any connection to reality to sell their tax-cut snake oil.
Why, then, can the right wing make this false claim? It’s because they’ve taken one misleading number, wrenched it out of context, and presented it without adjusting for inflation or population growth.
But don’t take our word for it — ask any economist, even the conservatives. This is not a talking point that anyone with any credibility believes. It’s pure Karl Rove spin.
The nonpartisan Annenberg Public Policy Center studied these claims, and economists–conservative and liberal alike–think the revenue picture would be brighter without the Bush tax cuts.
“Federal revenue is lower today than it would have been without the tax cuts,” Alan D. Viard of the conservative American Enterprise Institute told the Washington Post last October. Viard, who worked in the Treasury Department’s Office of Tax Analysis and the White House’s Council of Economic Advisers under President Bush, told FactCheck.org that “nobody can absolutely prove that.” Proof would require time travel and a reversal of tax policy. “But among economists, there’s no dispute.” [emphasis added]
If you adjust for inflation, revenue *fell* during the Bush years. If you adjust for population growth, revenue cratered. Here is a chart that shows both the inflation-adjusted and the non-adjusted numbers.
Yes, in non-adjusted figures, tax revenues did increase from 2000 to 2008—just as they did for every single eight-year period since 1940. More telling is that 2008 was the first year since 1960 that inflation-adjusted revenues were lower than eight years before.
So much for the “record revenue” during the Bush years: every president achieves “record revenue” by that standard. Bill Clinton achieved “record revenue” during every year of his presidency, and so did the first Bush, Carter, Ford, Johnson, and Kennedy.
What distinguishes President George W. Bush is being the only president since the Great Depression to manage record revenues in merely half of his years in office, and the only one to leave office with lower inflation-adjusted revenues.
If you talk to virtually any economist with credibility — conservative or liberal — they’ll tell you the deficit is composed primarily of two things: spending on the wars in Afghanistan and Iraq, and the Bush tax cuts, which will add $1 trillion to the deficit over the next 10 years. Check out the chart on the right here.
If you hear someone bring up this talking point, just remember:
1. It’s not supported by any of the actual inflation-adjusted numbers;
2. Even if the claims of increased revenue were true, which they aren’t, it wouldn’t matter, because revenue would have grown much more without the tax cuts;
3. Practically every economist in the world, even the most right-wing, thinks this is false.
Bush’s economic record doesn’t deserve to be rehabilitated. His tax cuts for the wealthy deserve to expire, for the good of working families everywhere.