President Biden has introduced his American Jobs Plan which will fund investments in our people and our infrastructure with higher taxes on corporations and individuals who make over $400,000.00 per year. “S&P predicts that Biden’s infrastructure plan will create 2.3 million jobs by 2024, inject $5.7 trillion into the economy — which would be 10 times what was lost during the recession — and raise per-capita income by $2,400,” Axios reported.
This should come as no surprise to anybody but the sabotage minded D.C. Republicans have come out in opposition to Biden’s plan. One of the key talking points from the right is that the proposed tax increases would be job killers. Senator Susan Collins (R-ME) alleged that the proposed 28% corporate tax rate would cause the loss of jobs. Not to be outdone in the pessimism sweepstakes, Senator Tim Scott in the GOP response to President Biden’s address to members of Congress last week contended that the plan contains: “The biggest job-killing tax hikes in a generation. ”
Now what I find interesting is that the GOP has been erroneously prognosticating that tax increases on the rich would hurt the economy since way back in 1993. It’s like Collins and Scott simply cut and pasted GOP talking points from the Clinton and Obama years. Let’s take a little trip down memory lane and see how previous D.C. Republican predictions of doom and gloom played out.
In 1993, Bill Clinton proposed to roll back Reagan’s tax cuts for the rich in an effort to reduce the deficit mess that he inherited from Reagan and Bush 41. While the born again GOP deficit virgins in 1993 demanded immediate deficit reduction, not one of them voted for Clinton’s budget.
Instead, every Republican predicted that Clinton’s economic program would cause a recession and increase the deficit. For example, John Kasich (then a Republican congressman from Ohio) contended that: “I feel bad for the people who really are the working people in this country, people in my family, who are going to get the penalties from people who don’t want to invest more, take any more risks. They’re going to lose their jobs, and that’s the tragedy of this program. We’re going to come back here next year, there will be higher deficits, there will be more spending, we’ll continue to have a very slow economy, people aren’t going to go to work.”
Just how did those Republican predictions of doom and gloom play out? As we know, they were dead wrong. What followed the passage of the 1993 Clinton budget package was the greatest peacetime economic boom in U.S. history. During the Clinton Presidency, 22 million new jobs were created, unemployment declined from 7% to 4%, median family income rose, and poverty declined to its lowest rate in 20 years. The Clinton budget also converted what was then the largest budget deficit in American history to a projected surplus of $5.6 trillion over the next ten years.
The D.C. Republicans made similar predictions of disaster when President Obama raised taxes on the wealthy in 2010 and 2013. The 2010 tax increases were aimed at funding Obama Care and the 2013 tax increases partially rolled back the failed Bush 43 tax cuts for the wealthy.
During the debate over Obama Care in 2010, then GOP House minority leader John Boehner predicted: “Passage of health reform is “Armageddon” because the law will “ruin our country.” Not to be outdone, then former Senator Rick Santorum alleged that : “Health reform “will destroy the country” because, “in the next year or so,” America will have to “dramatically cut the military because we can’t pay for it.””
In 2013, candidate Ben Sasse made an equally apocalyptic prognostication. In his announcement speech, Sasse proclaimed that “If the Affordable Care Act survives, America will cease to exist.”
That same year, Marco Rubio was was much less hysterical but he was still very pessimistic about the partial rollback of the failed Bush tax cuts for the rich: “Because more government raises taxes on employers who then pass the costs on to their employees through fewer hours, there will be lower pay and even layoffs.”
Just how did those Republican predictions of the end of America play out after taxes were increased on the rich? Between 2010 and when Obama left office, the unemployment rate was reduced from 10% to 4.7%. In 2016 alone, the economy added 2.15 million jobs. Moreover, since the end of the Bush recession, the economy added 15.6 million jobs. That was the best record of job creation since Bill Clinton’s second term.
Beginning in 2015, the economy began to create good jobs and working families experienced real wage growth for the first time since the Clinton Administration. According to the Census Bureau, real median household income increased by 5.2% between 2014 and 2015, while the official poverty rate dropped from 15% to 13.5%. The 5.2% growth was the largest, in percentage terms, since the 1960s. In 2016, hourly pay increased 2.9% from a year earlier, the biggest increase since 2007.
In contrast, a net 3 million jobs were added during the eight years of the Bush Administration after he cut taxes for the wealthy two times. When Bush left office in 2009, the economy was losing 800,000 jobs per month. Bush was the only two term president in American history to preside over a decline in middle class incomes during his two terms as president.
Trump’s record on the economy was equally dismal after he rammed through a deficit funded $2 trillion tax cut for the wealthy on a straight party line vote in 2017. In 2020, the U.S. economy lost a net 10 million jobs. Trump was the first president since the Great Depression to leave office with fewer jobs in the country than when he was inaugurated.
The history of the U.S. since 1993 clearly proves that tax cuts for the wealthy don’t stimulate the economy. Moreover, it also proves that tax increases on the wealthy don’t weaken the economy. Instead, the economy performs much better for all Americans when that money is invested in our people and infrastructure. As Harry Truman said: “The only thing new in this world is the history that you don’t know.”
Why would anybody believe the D.C. Republicans after they have been so wrong for so long? The D.C. Republicans want Biden and the country to fail so they can grab power again. Why are the D.C. Republicans so cynical and so negative?
The Republicans are the party of the rich, sabotage, mass unemployment, mass illness, mass death and violence. The Republicans will always be the party of Donald Trump.
The Democrats are the party of the people, prosperity, Social Security, Medicare, Medicaid and the ACA. We must never let the voters forget that. History matters. Now let’s get it done!