Ten years ago today, the Bush Tax Cuts took effect. That was July 7, 2011….shortly before the United States embarked on ten years of war, an economic crisis, soaring debt, and individual financial hardship for a great many Americans. Yet the Bush Tax Cuts, which handed massive tax giveaways to the wealthiest Americans have clung on, leaving middle class Americans with the burden of closing up the deficit created by handouts for the wealthy.
Stephanie Mencimer at Mother Jones has put together a good rundown of the disasters that Bush’s tax policy wrought, including:
Big debt: Between 2001 and 2010, the Bush tax cuts added $2.6 trillion to the public debt, 50 percent of the total debt accrued during that time. Over the past 10 years, the country has spent more than $400 billion just servicing the debt created by the cuts.
Supply-side failure: Far from paying for themselves with increased economic activity as promised, the tax cuts have depleted the public treasury. Tax collections have plunged to their lowest share of the economy in 60 years.
No jobs: Between 2002 and 2007, employment increased by less than 1 percent when the economy was supposed to be expanding. Employment growth barely kept pace with population growth. Between the end of 2001, when the country was in a recession, and the peak of the real estate bubble, er, economic expansion in 2007, the US economy performed worse than at any time since the end of World War II.
Rich people benefit: The best-known result of the Bush tax cuts is that virtually all the benefits were conferred upon people who didn't need them at all and who didn't use the money to, say, create more jobs or pay their workers better. Median weekly earnings fell more than 2 percent between 2001 and 2007. Meanwhile, people making over $3 million a year, who account for just 0.1 percent of taxpayers, got an average tax cut of $520,000, more than 450 times what the average middle-income family received.
The 2001 tax cuts were supposed to be temporary, but in 2010 were extended for two years at the insistence of Republicans in Congress. Today, PFAW’s Michael Keegan writes in the Huffington Post that maybe it’s time Republicans look to the tax policies of one of their greatest heroes, Ronald Reagan, and rethink their don’t-tax-the-rich orthodoxy. He calls his plan the Ronald Reagan Tax Reform Act of 2011.