This morning's Op Ed in the Globe strives to show that neither party was solely responsible for economic melt down we've experienced over the last several years. That' s all well and good until they point out that one of the contributing factors was "The second highest cause was a 13 percent drop in federal revenues caused by enactment and continuation of all Bush-era tax cuts amounting to a 13 percent drop in federal revenue." The problem with this statement is that according to the US treasury, federal history is a little different and points out yet again that the politicians, and the Globe don't know how to add and subtract, except to benefit a cause. In 2001 we were in a recession and Bush was able to pass tax cuts. In 2002 tax revenues fell by 9.08%. In 2002 tax revenues fell by 1.03%. One could justifiably argue that the tax cuts impacted the revenues received and they did. But even in the middle of a recession the worst of it was only 9% not 13% as suggested in the Globe today. The Globe neglects to point out the reason why the tax cuts were enacted, and why the current administration has kept them in place. In 2003 federal revenue went up by 7.28%, 2004 - 14.03%, 2006 - 11.55%, 2007 - 6.14%. In these 4 years income to the US Treasury went up by 900 billion dollars. 600 billion dollars more than the previous high in the year 2000. The problem is that while the income to the US treasury went up a total of 6.63% for the years 2002 - 2009, congressional spending increased by 7.9%. The reasoning used in the Globe Op Ed has to assume that the income that would have been derrived had the tax cuts not been enacted, would still be coming into the treasury on top of what did come into the treasury and that makes about as much sense as Baseline Budgeting.
What might have made an interesting story is the fact that income tax levels as a measure of GDP, according to the Congressional Budget Office, are below the 30 year historic average of 8.4% of GDP as measured between 1970 and 2000 and have remained so. Is this because the rich are paying too little in taxes? Again facts tell us that the rich actually paid more in taxes as a result of the Bush tax cuts because of the Alternative Minimum Tax written into the tax code to prevent the uber wealthy from getting off too easy until 2005. The AMT was modified in 2005 to ease this burden and the uber wealthy have been enjoying a true tax cut ever since. One could argue that we didn't see benefit from that tax cut because the economy was already slowing down, but the tax cut for this one group certainly didn't stop the slow down.
By the way, the Democrats controlled the Senate and the Republicans controlled the house in 2001 and 2002. The Republicans controlled both houses from 2003 to 2007 when the Democrats took over both sides of the aisle until the Republicans took control of the House again in 2011. Both sides have been responsible for being irresponsible but lets get the facts correct for a change. I thought that used to be what news agencies were about, or at least were supposed to be about.