Supply-Side Economics

Cal Thomas | Syndicated columnist | Tuesday, June 14, 2005

Supply-Side Economics

June 14, 2005

You've heard the argument - cutting taxes only benefits the rich and deprives government of money it needs to improve the lives of the middle class and poor.

Not true, but the legend continues.

Stephen Moore wrote in yesterday's Wall Street Journal about the latest revenue figures based on the Bush administration's tax cuts of 2003.

The reduction in tax rates on dividends from 39.6 percent to 15 percent and on capital gains from 20 to 15 percent have produced a surge, not a decline, in tax revenue.

They're up $187 billion, or 15.4 percent in the first eight months of this fiscal year.

Since the tax cut, individual ad corporate tax receipts have exploded and are up 30 percent.

Tax cuts produced a chain reaction.

Higher profits mean more tax revenue.

Higher taxes mean less because people shelter income or don't make as much and so have less to invest.

It's called supply-side economics.

It worked under Reagan and it is working under Bush.

It also worked under John Kennedy.

Class warfare is meaningless, but the democrats continue to practice.

Let them. Higher taxes is a losing issue.

I'm Cal Thomas in Washington.

Cal Thomas is a nationally syndicated columnist based in Washington, D.C. Watch his television show, After Hours with Cal Thomas, on the Fox News Channel, Saturdays at 11 p.m. Eastern Time.