E.J. Dionne: 'Tax Cuts Add to the Deficit No Less Than Spending Increases Do'

What kind of an idiot must you be to believe that tax cuts have an equal dollar for dollar negative impact on a government budget as spending increases do?

The most obvious answer given the charge of this website is a liberal media member, and the Washington Post's E.J. Dionne nicely proved this point with his column Monday:


Really, E.J.? For that to be true, wouldn't absolutely no positive economic impact have to come from such a tax cut?

If tax cuts have no stimulative value whatsoever - zero, zip, zilch! - why did President Obama and former President Bill Clinton tell the nation less than a month ago it would be castrophic for the economy to allow the Bush tax cuts to expire?

I guess E.J. forgot that.

Economists on the left and the right have debated for decades what the net revenue result is from tax cuts.

Conservative analysts cite the explosion in tax receipts during the Reagan era as evidence tax cuts stimulate the economy to such an extent that federal coffers grow at a much faster rate than if rates had been left unchanged.

Income tax receipts also grew much faster in the latter part of the '90s following the Gingrich tax cuts than they did after Clinton's tax hikes in the early part of that decade. The same was true in the '00s when receipts exploded nicely after the Bush cuts were enacted up until the financial crisis in 2008.

Not convinced of this is former Federal Reserve chairman Alan Greenspan who has said on numerous occasions that tax cuts have some net negative impact to the budget, although to the best of my knowledge he's never quantified the associated percentage reduction.

However, for tax cuts to result in a dollar for dollar decline in receipts necessitates absolutely zero positive stimulation to the economy as a result of said cuts, and there is no recent history of such a thing occurring.

But what should we expect from a so-called journalist that on the one hand writes, "Like it or not, Republicans won the House in last year's election" while moments later quoting the perilously liberal historian Gordon Wood to bash the Tea Party:

From its inception, the Tea Party movement has treated the nation's great founding document not as the collection of shrewd political compromises that it is but as the equivalent of sacred scripture.



For those unfamiliar with Wood, the conservative think tank the Claremont Institute's Steven Hayward depicted him quite accurately in 2007:


Any surprise that Dionne finds Wood's views important and has no clue of the stimulative nature of tax cuts?

Noel Sheppard
Noel Sheppard