We covered this debate in the comments earlier, but in our never-ending and always vain crusade to base policy debate on actual fact rather than invented “truth,” let’s address it again, head on, so nobody can claim they missed it:
Contrary to what you may have been told and may wish to believe, the tax increases used to fund ObamaCare do not amount to the largest tax increase in history, in American history, or in American history since 1950, since 1968 or even since 1980.
However you want to cut it, it is not even close.
To the right is the list of major tax hikes since 1950, ranked by the percentage of gross domestic product that they diverted into the coffers of the U.S. government. As you can see, the 1982 tax increase signed into law by President Ronald Reagan was 60 percent greater than the tax hike needed to implement ObamaCare.
A few other points of interest:
– Note the three large tax increases implemented in the early ’50s, a decade in which real gross domestic product increased by 48.7 percent.
– Note that of the 15 largest tax hikes in U.S. history since 1950, five were signed into law by President Reagan.
– Note what isn’t there. President George W. Bush, with a Republican Congress, passed a major expansion of governmental health care with Medicare Part D and also fought two wars — one necessary, one optional — without bothering to finance that spending.
— To the contrary, while engaging in those expensive programs, President Bush and the Republican Congress passed major tax reductions in 2001 and again in 2003. Yet GDP growth in the decade was less than half those of every previous post-war decade.
– Note the 1993 tax increase signed into law by President Clinton with no Republican support. Republican leaders at the time predicted it would create a major economic meltdown. Instead, real GDP growth in the ’90s reached 37.6 percent, slightly higher than during the ’80s.
– In other words, the simplistic claim that tax cuts create growth and tax increases create recessions is simply false.
– Most important, look at the larger picture. In the previous decade, economic growth slowed to less than half the rate of any previous post-war decade; in addition, the distribution of that reduced growth was skewed heavily toward those at the very high income levels. The takeaway? If people are feeling economically squeezed, they have every right to be.
And even though the squeeze manifested itself most clearly in an era of GOP rule, lax regulation and significantly lower federal taxes, the Republican Party continues to identify government as the sole villain causing the slowdown. It is fairy-tale economics.
– Jay Bookman