Monday, November 14, 2005

Tax cuts do work

Here is a column from this week's National Review which describes why the tax cuts implemented by George W Bush are working. And, why Bush should stay the course and continue his tax cut agenda.

The stock market and economy responded: Since June 2003 real GDP growth has averaged 4 percent while growth in real business fixed investment spending has averaged nearly 9 percent on an annualized basis. Real equipment and software spending has averaged 11 percent annualized growth. The stock market is up 26 percent since mid-2003. Tax receipts have surged $275 billion over last year’s levels, the strongest rate of growth in 23 years, with notable strength in “non-withheld receipts” which are tied to capital assets. And the fiscal deficit, which reached 3.4 percent of GDP in 2004, has fallen by nearly $100 billion to 2.5 percent of GDP in fiscal 2005, in line with the 30-year average.

3 comments:

Shawn said...

Laffer curve anyone?? Remarkable what people can do when the government allows them to reap the rewards of their creativity.

John Murney said...

Question - will these tax cuts help the U.S. Government come to grips with its massive budget deficit? I would like to know your thoughts on this.

David MacLean said...

The american deficit is a result of ridiculous spending, not from tax cuts. Tax revenues have actually increased since the tax cuts, as was expected by most economists.

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