Skip to comments.Economic Growth Will Pay For Mitt Romney's Tax Cuts
Posted on 08/23/2012 7:46:55 AM PDT by SeekAndFind
On August 18, the Washington Post published an editorial calling Republican presidential candidate Mitt Romneys tax reform plan garbage. Citing reports from the (allegedly) non-partisan Tax Policy Center, the Post said that it is not possible to broaden the (tax) base sufficiently to pay for Mr. Romneys proposed tax rate reductions.
The critics of the Romney tax plan are missing the point. The only tax base that matters is GDP. The Romney tax plan will broaden the tax base by increasing GDP. Whatever it does or does not do to broaden the tax base by closing loopholes is a sideshow.
The only thing that really matters about any tax planwhether Mr. Romneys or Mr. Obamasis what rate of real economic growth it delivers. If famed football coach Vince Lombardi had been an economist, he would have said, Economic growth isnt the most important thing, its the only thing. Heres why.
In 2011, U.S. GDP was $15.1 trillion. Americas economy was the biggest in the world, more than twice as large as second-place China. U.S. GDP per capita was about $48,300 in 2011, which put us at #14, behind a list of countries with much smaller populations.
Americas 2011 GDP was the result of an average real economic growth rate of 3.73% over the 221 years from 1790 to 2011. If, during this period, our economy had grown at 1.47% real, which is what we have averaged for the first 3.5 years of Obamas presidency, our 2011 GDP would have been about $116 billion, which is about the same as that of Bangladesh. Our GDP per capita would have been $371, which would have put us just ahead of Sierra Leone.
(Excerpt) Read more at forbes.com ...
America cannot be America at the GDP growth rate being delivered by Obamas economic policies. Thats why Romney is proposing a supply-side tax cut.
People and businesses respond to incentives. Whatever you tax, you get less of. Whatever you reduce taxes on, you get more of. By reducing tax rates on the factors that produce economic growth, which are work, savings, and investment, America would get a higher rate of economic growth.
Here is the supply-side equation: Lower marginal tax rates = higher economic growth = higher GDP = bigger tax base = higher tax revenues at the lower tax rates.
And cutting spending and entitlements, etc. will “pay” for tax cuts.
We’ll not win this argument until we figure out that tax cuts aren’t an entitlement, and thus need not be “paid for”. They’re a burden reduction ... not an expenditure.
Don’t buy the ridiculous premise, and their ‘logic’ breaks down very easily.
the increased revenue from 2003-2007 would have “paid” for the Bush tax rates except the fools in Congress and the WH went on a spending spree
Unless this asinine political behavior from an out of control democrat party and a compliant enabling GOP is controlled - there is NO HOPE
I cannot stand the stupid “How are we going to pay for tax cuts?” argument. It is devoid of reason and vapid.
Beat me to it in essence. My sentiments exactly —> see post #6