Speaker Boehner Dodges Questions About Failure Of Bush Tax Cuts
In an address to the Economic Club of New York last night, House Speaker John Boehner (R-OH) emphasized the need to tackle the nation's deficits, saying that Republicans will not vote to increase the debt ceiling without first securing "trillions" in spending cuts. Despite his alleged commitment to balancing the budget, Boehner adamantly rejected the possibility of increasing government revenues by ending the Bush tax cuts for the wealthiest Americans.
The mere threat of tax hikes causes uncertainty for job creators -- uncertainty that results in less risk-taking and fewer jobs.
If we're serious about balancing the budget and getting our economy back to creating jobs, tax hikes should be off the table.
There's plenty wrong with Boehner's argument, not the least of which is that it came during a speech in which Boehner promised to introduce more uncertainty into the economy by using the debt ceiling as a bargaining chip. Moreover, Boehner glosses over the inconvenient fact that when upper-income tax rates were higher during the Clinton era, the economy was strong and budgets were balanced.
On NBC this morning, Today host Matt Lauer asked Boehner about his unwillingness to consider raising taxes on the wealthy. Pressed on the failure of the Bush tax cuts, Boehner initially dodged the question before arguing that the cuts were actually successful in creating jobs, but that many of them were lost in the recession:
LAUER: Why not use an increase in revenues — tax hikes to help with that debt problem? What is the evidence that you can present that the tax cuts of the bush era have actually accomplished their goals.
BOEHNER: What some are suggesting is that we take this money invest in our economy and create jobs and give it to the government. You can't tax the very people that we expect to invest in our economy and create jobs. Washington doesn't have a revenue problem. Washington has a spending problem.
LAUER: But when you talk about creating jobs, when the Bush era tax cuts were passed in 2001, unemployment in this country was at 4.5 percent. Today, it's at 9 percent, just down from 10 percent. So why are the Bush era tax cuts creating jobs?
BOEHNER: They created about 8 million jobs over the first 10 years they were in existence. We've lost about 5 million of those jobs during this recession. But you can't raise taxes.
Contrary to Boehner's spin, the Bush tax cuts were a failure even before the onset of the recession at the tail end of the Bush administration. From 2001-2005, President Bush oversaw the slowest five-year period of economic growth since World War II; the following five years, with help from the downturn, were even worse. Bush also presided over the first decline in median household incomes since the 1960s (see charts below the fold).