December 26, 2012

Thomas Sowell: Fiscal Cliff Notes (Part II) — Frontiers of Freedom

Part II of Thomas Sowell's rational analysis on the political charade that dominates Washington these days. The nation has a spending problem, not a revenue problem, a fact that the media fails to fully examine. Instead, they buy the Democrat political spin.

Thomas Sowell: Fiscal Cliff Notes (Part II) — Frontiers of Freedom: "The bottom line is that Barack Obama’s blaming increased budget deficits on the Bush tax cuts is demonstrably false. What caused the decreasing budget deficits after the Bush tax cuts to suddenly reverse and start increasing was the mortgage crisis. The deficit increased in 2008, followed by a huge increase in 2009.
So it is sheer hogwash that “tax cuts for the rich” caused the government to lose tax revenues. The government gained tax revenues, not lost them. Moreover, “the rich” paid a larger amount of taxes, and a larger share of all taxes, after the tax rates were cut.
That is because people change their economic behavior when tax rates are changed, contrary to what the Congressional Budget Office and others seem to assume, and this can stimulate the economy more than a government “stimulus” has done under either Bush or Obama."

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