During the 2004 Presidential campaign, Sen Kerry said he would cut the deficit in half by raising taxes.
At an April 7 speech, Kerry said as president he would cut the deficit in half in four years by rolling back the Bush administration's tax cuts "for the wealthiest Americans while expanding tax cuts for the middle class."
One of his proposals was to
Roll back the Bush administration's tax cuts, including dividend tax cuts, for people earning more than $200,000
Bush argued the opposite: Make the tax cuts permanant
"Making the tax cuts permanent is an important part of deficit reduction because lower taxes have stimulated our economy so effectively. A growing economy leads to increased Treasury receipts, and when combined with restrained spending, deficits can be shrunk."
It seems, Bush was right, and Kerry was wrong
Aided by surging tax receipts, President Bush may make good on his pledge to cut the deficit in half in 2006 — three years early.
Tax revenues are running $176 billion, or 12.9%, over last year, the Treasury Department said Monday. The Congressional Budget Office said receipts have risen faster over the first eight months of fiscal '06 than in any other such period over the past 25 years — except for last year's 15.5% jump.
The 2006 deficit through May was $227 billion, down from $273 billion at this time last year. Spending is up $130 billion, or 7.9%.
Everytime it has been tried, by Kennedy, Reagan and now Bush, the contrary theory that cutting taxes increases revenue to the Federal government has been proved out. And, it turns out, that the rich wind up getting taxed more anyway.
While gains are broad, those at higher-income levels are enjoying bigger salary hikes. Because they pay higher rates, federal tax revenues soar when they do well.
Those making over $200,000 now pay 46.6% of total income taxes, presidential adviser Karl Rove recently said. That's up from 40.5% — despite Bush's tax cuts.
And, Bush was right about another thing that neither the public nor Democrats in Congress have the guts to handle
Long-term growth in Social Security, Medicare and Medicaid "threaten to force either European-style tax increases, unprecedented spending cuts or unprecedented debt," said Heritage Foundation budget expert Brian Riedl. "There's no growing out of the long-term budget problems."
During the debate about partial privatization, Democrats proclaimed that Social Security was not broken.
How are we going to fix these problems if no one will even acknowledge that there is a problem?