Viva Tax Reform!

The GOP has remembered who it is! In spite of deep antipathy for the sitting president, including Senator's Corker epic take-down of the main occupant of the day care, they have passed a budget recommendation this week. This could pave the way for massive tax cuts - maybe $4 to $5 Trillion over a period of a decade. This will of course increase the deficit and debt, adding perhaps $1.5 Trillion to the debt during that time.

Reagan cut taxes saying this reduction in government revenue would grow the economy and increase government revenue over time. When he came into office, the deficit was $79 Billion a year. When he left office, it was $155 Billion a year.

Bush Senior raised taxes slightly, and was destroyed at the ballot box because of it. His successor, Filthy Bill, also raised taxes, and left a substantial surplus to his successor.

Bush Junior oversaw a $350 Billion a year in tax cut to the rich, saying the same thing as Reagan - cut taxes, and the government ends up with more money courtesy of the subsequent economic growth. He started with a surplus of about $125 Billion a year, and ended his time in office leaving a deficit of about $458 Billion.

Here is a thought regarding tax cuts to grow the economy and increase government revenue - maybe this doesn't work?

The problem may not be the theory. Give money to people, they spend it, economic activity increases, and voila - more government revenue! This seems pretty obvious. The problem may not be the theory, but the people implementing the theory - the politicians.

You see, if this works, then new money will start to come into the government's coffers fairly soon after the tax cuts. This is supposed to go to balancing budgets and paying off debt. But it never does. The second politicians see new money, they spend it on their favourite constituents, or their favourite theory of social development, or they pay back the people who supported them, or they just spend to try to buy votes for the next election. No matter what, the spend it all, so that this nice new money is NEVER actually used to render the state solvent.

But it is actually worse.

When the economy starts to grow, it arms politicians to claim that with a higher GDP, it is possible to borrow even MORE money. They then engage in a shameless round of taking money from the future to finance their short-term political ambitions, thereby leaving the state in even more of a mess than when they started.

And so, the problem with the "cut taxes to grow the economy and increase government revenues" may not be the theory, so much ad the people implementing it. With this, its greatest flaw is the simple reality that it does not require any political will to actually balance budgets and pay off debt - this is supposed to just magically happen. Look at the numbers above - it has simply never worked.

We are on the tax cut train again!!! Will Senator's like Corker and Rand Paul succeed in putting limits on the tax cuts, forcing those who would recklessly drive America into penury and woe to match any tax cuts with spending cuts as well, so that there is no increase in the deficit?

We shall see.

Mueller has been interviewing everyone Trump has fired recently.