Tuesday, November 20, 2012

Republicans Push The "Job Creator" Lie

 Speaker Boehner on November 7, 2012
This is why going over part of the fiscal cliff and raising taxes on job creators is no solution at all. 
Instead of building our house on sand, let's build it on rock. 
Instead of raising small businesses' taxes, let's start fixing their problems.
 Speaker Boehner doesn't want to build his house on sand, choosing instead to build a house on a bed of lies.  The wealthy are not job creators, there is no data supporting the claim that the top 2% create jobs.  We have had low tax rates on "job creators" for 10 years, where are the jobs?  We have lots of data demonstrating that a strong middle class enables robust economic growth.  A CRS study found no relationship between top tier tax rates and economic growth, but did find that low top tier tax rates promoted income inequality.  How are we to bargain with republicans when they won't deal with facts, but choose to negotiate from a position built on propaganda and lies.

Congressional Research Service; Taxes and the Economy: An Economic Analysis of the Top Tax Rates Since 1945
Some studies find that a broad based tax rate reduction has a small to modest, positive effect on economic growth. Otherstudies have found that a broad based tax reduction, such as the Bush tax cuts, has no effect on economic growth. It would be reasonable to assume that a tax rate change limited to a small group of taxpayers at the top of the income distribution would have a negligible effect on economic growth.
 "The results of the analysis suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution. As measured by IRS data, the share of income accruing to the top 0.1% of U.S. families increased from 4.2% in 1945 to 12.3% by 2007 before falling to 9.2% due to the 2007-2009 recession. At the same time, the average tax  rate paid by the top 0.1% fell from over 50% in 1945 to about 25% in 2009. Tax policy could have a relation to low the economic pie is sliced—lower top tax rates may be associated with greater income disparities."
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