Hindsight is 20/20

Tonight I'd like shed some light and present a few facts on a big bad situation called raising taxes. A book I am currently reading states, "The big Regan income tax rate cuts of 1981 and 1986 turned a stagnant economy into the world's most dynamic. The U.S. share of global GDP went up sharply, as did the share of America's equity of the world's total equity value. Because Reagon wanted to win the cold war, thereby rebuilding our dilapidated military, and because Congress was--as usual-- addicted to domestic spending, federal outlays mushroomed and the national debt went up $1.7 trillion." Well, that is all very true but what is not mentioned is that the entire wealth of the nation during that exact same period went up $17 trillion. Yes, you read that right, $17 trillion people! There is not an organization around that wouldn't jump at the chance to exchange $5 of debt for $50 of equity.

In 1993 President Clinton's tax increases slowed the growth of the U.S. economy and guess what happened next? The democrats were routed in the 94' congressional elections. While the republicans were in charge during the clinton era the capital gains levy was cut over 28%. That being said about republicans, democrats did play a big role with the 2003 Bush tax cuts: capital gains tax was cut again, personal dividend tax was slashed, incentives for business to invest were instituted, and personal income tax rates were reduced. This helped turn the U.S. economy from a 1% growth to a 3-4% growth rate.

Interesting Fact: Between 2003 and 2007 the growth of the U.S. economy alone exceeded the entire size of the Chinese economy.

So, what's the bottom line you ask? Well, hopefully current Washington analyzed every single possible situation before deciding to increase taxes on the "wealthy".