http://online.wsj.com/article/SB121365641014879041.html

Senator Obama in today’s Wall Street Journal:

“I'm a big believer in evidence. I'm a big believer in fact…If I saw strong evidence that an additional $300 billion in tax cuts that John has proposed…would actually boost economic growth and productivity, I’d be happy to take a look at that evidence. But I haven’t seen that. It’s all conjecture.” 

Where were you in the ‘80s, Mr. Obama? Or the sixties? Or the twenties? 2001? 2003? 

Here’s your evidence:

Tax cuts under the leadership of President Coolidge

In 1913 (when the federal income tax was established), the top marginal rate was 7%.

By 1918, this same top rate had risen to 77%.

In 1925, the top marginal income tax rate was reduced to 25%.

Over the next four years, economic output almost doubled.

Tax cuts under the leadership of President Kennedy

In 1962, the top corporate tax rate was reduced from 52% to 48%.

In 1964 (signed by President Johnson), the top marginal income tax rate was reduced from 91% to 70%.

What was the result on the economy? From 1959-1962, economic investment grew at an annual rate of 3%, but between 1962-1969, investment grew at an annual rate of 6.1%. After these tax cuts were repealed, investment grew at an annual rate of only 2.3% between 1969 and 1972. Furthermore, the gross national product grew at 2.4% from 1952-1960, but it grew at 4.5% per year from 1960-1970. 

What about the result on government revenue? From 1952-1959, government revenue increased 1.2% per year, but between 1962-1969, revenue increased at an annual rate of 6.4%. Furthermore, the deficit during these years fell from $7.1 billion to $1.4 billion. 

Tax cuts under the leadership of President Reagan

In 1981, the top marginal rate was reduced from 70% to 50%.

By 1988, this rate had been reduced to 28%.

What was the result on the economy? From 1978-1982, the real gross domestic product grew at an annual rate of 0.9%, but between 1983-1986, it grew at a rate of 4.8% per year. In 1982, the unemployment rate was 9.7%. In 1986, it was 7.0%, and by 1989 it had fallen to 5.3%.

Tax cuts under the leadership of President Bush

In 2003, the top marginal tax rate was lowered to 35%.

In 2004, tax revenues increased by 5.5%.

In 2005, tax revenues increased by 14.5%.

Supply-side economics has worked every time it has been tried. May I have my tax cut now, please?

Sources

http://taxesandgrowth.ncpa.org/news/do-taxes-affect-economic-growth

http://www.businessandmedia.org/commentary/2006/com20060111.asp

The economic facts listed below provide the historical perspective in which all Americans should cast their votes this year.

In 1913 (when the federal income tax was established), the top marginal rate was 7%.

By 1918, this same top rate had risen to 77%.

In 1925, the top marginal income tax rate was reduced to 25%.

Over the next four years, economic output almost doubled.

In 1962, the top corporate tax rate was reduced from 52% to 48%.

In 1964 (signed by President Johnson), the top marginal income tax rate was reduced from 91% to 70%.

What was the result on the economy? From 1959-1962, economic investment grew at an annual rate of 3%, but between 1962-1969, investment grew at an annual rate of 6.1%. After these tax cuts were repealed, investment grew at an annual rate of only 2.3% between 1969 and 1972. Furthermore, the gross national product grew at 2.4% from 1952-1960, but it grew at 4.5% per year from 1960-1970. 

What about the result on government revenue? From 1952-1959, government revenue increased 1.2% per year, but between 1962-1969, revenue increased at an annual rate of 6.4%. Furthermore, the deficit during these years fell from $7.1 billion to $1.4 billion. 

In 1981, the top marginal rate was reduced from 70% to 50%.

By 1988, this rate had been reduced to 28%.

What was the result on the economy? From 1978-1982, the real gross domestic product grew at an annual rate of 0.9%, but between 1983-1986, it grew at a rate of 4.8% per year. In 1982, the unemployment rate was 9.7%. In 1986, it was 7.0%, and by 1989 it had fallen to 5.3%.

In 2003, the top marginal tax rate was lowered to 35%.

In 2004, tax revenues increased by 5.5%.

In 2005, tax revenues increased by 14.5%.