It is beyond obvious at this point that the debate in this country over taxes is essentially a political one, driven by Democrats desire to divide the country through class warfare. The debate can’t possibly be an economic one, because the evidence is so clear. Tax cuts stimulate the economy by putting more money in the hands of consumers and businesses. The result, we are seeing record high revenues pouring into the federal treasury, higher than anyone predicted. When government spending actually slows, as it has recently, the result is the deficit shrinks dramatically.
It’s pretty simple. Cut taxes, control spending, reduce the deficit.
Deficit Falls to Lowest Level in 4 Years
WASHINGTON (AP) — The federal deficit has improved significantly in the first three months of the new budget year, helped by a continued surge in tax revenues.
In its monthly budget report, the Treasury Department said Friday that the deficit from October through December totaled $80.4 billion, the smallest imbalance for the first three months of a budget year since The budget year ends Sept. 30.
Tax collections are running 8.2 percent higher than a year ago while government spending is up by just 0.7 percent from a year ago. Last year’s spending totals were boosted by significant payments to help the victims of the Gulf Coast hurricanes.
The Treasury said for December, the government actually ran a surplus of $44.5 billion, the largest surplus ever recorded in December and a gain that reflected a big jump in quarterly corporate tax payments.
The $80.4 billion deficit for the first three months of the current budget year was down 32.6 percent from the imbalance for the same period a year ago of $119.4 billion.
For the year, analysts are still forecasting that the deficit will worsen from last year’s total of $248.2 billion, which had been the lowest in four years.
Shame on the GOP Congress for not making permanent the Bush tax cuts while they had a chance. Now, instead of lower taxes going forward, the Democrats are going to turn the spicket off by raising taxes on “the rich” and “big business”. The economy is slowing, this is the exact wrong time to be raising taxes. Higher taxes DOES NOT mean more revenue for the government.
Imagine how low the deficit would be if the GOP Congress hadn’t spent like drunken sailors on a weekend furlough. Imagine how low the deficit would be if the GOP Congress addressed earmarks and pork, as they promised. Imagine how low the deficit would be if President Bush could locate his veto pen? Imagine, because it’s all about to be a distant memory and the Republicans have nobody to blame but themselves.