by Jack Hellner
I feel like I am beating a dead horse on tax cuts, economic results and debt but since reporters won’t report the truth here goes:
It is not surprising that Democrats, who paid $12 million to create a false Russian dossier, would also lie to keep people from keeping more of their own money so they can keep the power they have.
I get sick and tired of listening to Chuck Schumer lying about tax cuts. He complains endlessly about how it will add to the deficit and how it would jeopardize Medicare, Medicaid and Social Security. Not once during Obama's eight years did he complain about massive spending increases, slow growth and higher taxes, which yielded almost $10 trillion in new debt. .In fact, he supported everything. What makes me sicker is that almost all reporters just repeat Schumer's talking points as if they are factual. They repeat the outright lies over and over again, and then after indoctrinating the readers with pure garbage, they take a poll of fewer than 1,000 people, skewed with more Democrats than Republicans, to show that the people aren't in favor of reform. Then they run the poll results as if they are somehow factual news.
Reporters should be truly ashamed of themselves for pushing an agenda instead of ever even considering reporting actual results of previous tax cuts.
President Reagan inherited a disaster from President Carter in 1981, with double-digit inflation, double-digit unemployment and double-digit interest rates. The first thing Reagan had to do was wring out the high inflation and interest rates. In January 1981, when Reagan took office, there were 89.8 million jobs. Reagan then cut taxes from the abrasive 70%, to 28%. The economy took off, revenues to the government doubled instead of fell, and by January 1989, when Reagan left office there were 105.7 million jobs, which was a phenomenal result.
Clinton inherited a growing economy and although he did raise taxes at first, he lowered the capital gains tax rate from 28% to 20% in 1997 at the request of Republicans. Revenues did not go down as predicted but took off. From the following American Thinker article:
The 1997 rate reduction on capital gains unleashed the economy, causing capital investment to more than triple by 1998 and double again in 1999. Treasury receipts for this category of tax obligation increased dramatically. Without tax relief and the internet/communications revolution, the second Clinton term would likely have seen tax revenues decline in a lagging economy.The best and easiest example to show how growth, revenue, jobs and debt are affected by tax cuts are Bush’s, because he inherited a recession and declining revenue.
Bush inherited a recession that began in March 2001 along with a collapsed stock market. In FY2000 the government collected around $1.2 trillion in income taxes. By FY2003, despite rates being essentially the same, the government collected around $900 Billion. Bush’s across-the-board tax cuts taking all rates down passed in May 2003 and by FY2007 revenues not only didn’t go down as predicted, they went up over 60% to over $1.5 trillion. Total jobs when Bush took office in January 2001 were 130.7 million. By May 2003 when the tax cuts passed they had barely budged to 130.9 million. But by December 2007, jobs had risen substantially to 137.1 million, obviously goosed greatly by individuals being allowed to keep more of their own money. The deficit also was going up to over $300 billion by FY2003 and dropped to $161 billion by FY2007 (The last year of a Republican Congress) including both wars and Medicare Part D. It seems to be a foreign concept to reporters and other Democrats that rising revenues can’t cause the deficit and debt to rise.
The economy collapsed in 2008, not because of the tax cuts, but because of too much leverage throughout the economy. The leverage and collapse was contributed greatly to by Fannie and Freddie, two government-sponsored agencies, both of which used their implied guarantee of the government to borrow cheaply and buy garbage sub-prime mortgage pools to beef up their balance sheets.
The ratings agencies, Standard & Poor's, Moody’s and Fitch Ratings aided and abetted the collapse by selling their soul to put AAA ratings on these junk pools. The AAA ratings allowed Fannie, Freddie, pension funds, and mutual funds to buy these junk assets and assume there was little risk. Goldman Sachs, Countrywide and others could sell these junk assets to Fannie and Freddie because of the triple AAA ratings. So it became a vicious cycle.
The ratings agencies collected a lot of money for their signature and no analysis. Mark Zandi, chief economist for Moody’s and Warren Buffett, major shareholder of Moody’s came before Congress and said they had no idea that zero down, no document pools wouldn’t pay, so that is why they gave the high rating. They either lied to protect themselves from getting sued or are stupid. You choose.
The regulators also did not do their jobs. There were a lot of regulations in place to make sure banks operate in a safe and sound manner so they screwed up. Instead of holding regulators to account we got another regular Consumer Financial Protection Bureau and more regulations that put small banks out of office.
So there were a lot of culprits that caused the collapse, but it was absolutely not because Bush cut taxes for individuals.
There are many articles about Fannie and Freddie and politicians greatly contributing to the economic collapse:
In the 1990's under the administration of Franklin Raines, a Clinton Administration appointee, Fannie Mae began to demand that the lending institutions that it dealt with prove that they were not redlining. This meant that the lending institutions would have to fulfill a quota of minority mortgage lending. This in turn meant that the lending agencies would have to lower their standards in terms of such things as down payments and the required incomes. That set the ball rolling. If a bank granted a mortgage to a borrower that was not likely to successfully pay off the mortgage then all the bank had to do was to sell such mortgages to Fannie Mae. The banks typically earned a loan origination fee when the mortgage was granted. The lending agencies could then make substantial profits dealing in subprime mortgages.and
Because Fannie Mae and Freddie Mac made a market for subprime mortgages the lenders did not have to worry about of the soundness of the mortgage contract they wrote.
This month marks 20 years since President Bill Clinton unveiled his “National Homeownership Strategy,” a 100-point action plan that put as its overarching goal achieving an “all-time high level of homeownership in America within the next six years.”
That set in motion an effort by both parties in Washington to work with the private sector to loosen lending standards and make it easier for middle-class Americans with less savings or inherited wealth to purchase homes.
Fannie Mae, under powerful Democratic operatives such as Franklin Raines, Jaime Gorelick and James Johnson committed massive fraud to puff up their bonuses.
Senior executives at Fannie Mae manipulated accounting to collect millions of dollars in undeserved bonuses and to deceive investors, a federal report charged Tuesday. The government-sponsored mortgage company was fined $400 million.Bush tried to rein in Fannie and Freddie for years but was blocked by Congress, especially Democrats, every step of the way. This detailed analysis names Democratic Senators Barney Frank, Chris Dodd and Harry Reid as people who blocked and ignored Bush's warnings.
In 2007, Dodd and Schumer wanted to expand Fannie and Freddie, not rein them in. Why would anyone trust Schumer on anything when he had such little foresight?
Sens. Dodd and Chuck Schumer (D-NY) wanted to expand Fannie and Freddie as recently as a year ago,Obama inherited a recession in January 2009 when he took office but it ended 130 days later in June 2009, which means his policies had a minimal effect if any at all to the recession ending, so why do we hear that Obama brought us out of the disastrous ditch/ Even Obama admitted over a year after his stimulus passed that there weren’t very many shovel-ready jobs. What we got from Obama were massive spending increases, massive increases in regulations, tax increases and debt going up around $10 trillion (which somehow reporters and Schumer never cared about). The results of Obama’s eight years of greatly expanding the government’s power was the slowest economic recovery in 70 years. Why would anyone want to continue that?
The Troubled Asset Relief Program (TARP) did help bring the economy out and it was passed by Bush, before Obama took office and made the government a huge amount of money. Unlike the massive spending programs of Obama it helped mask some of the deficits in the Obama years.
The actual taxpayer profit on the bailout is about $350 billion, by my math. That’s right, $350 billion. All in cash, most of which has held down the federal budget deficit over the past six years. That’s serious money, even by today’s standards.In summary, tax cuts have routinely generated great economic growth and more revenue for the government which means they didn’t cause debt to increase and a massive increase in government power and money have yielded slow growth and massive debt. It is truly a shame that some Republicans seem to have no knowledge of the factual economic statistics and go along with CBO and other predictors who have always underestimated revenue from tax cuts and always underestimated the cost of government programs.
It is not surprising that Democrats who paid $12 million to create a false Russian dossier, who spied illegally on people close to Trump and who illegally unmasked people’s names and illegally leaked private conversations would continually lie to keep people from keeping more of their own money so they can keep the power they have amassed.
What is more dangerous to our freedom and democracy are reporters who will just repeat those lies so that the Democrats and their agenda can continue.
Follow Middle East and Terrorism on Twitter
Copyright - Original materials copyright (c) by the authors.