Bigger Government, Less Private Sector

Economic history has demonstrated that when lowering taxes the economy picks up (more money to spend) and ultimately more dollars flow into the Treasury. Roosevelt raised taxes and prolonged the depression. Eisenhower lowered taxes and along with other dynamics, ushered in unprecedented prosperity. Kennedy lowered taxes resulting in a surplus that Johnson used on his War on Poverty. Reagan lowered taxes to bring the country out of a deep economic malaise resulting in “the roaring 80s”. Clinton initially raised taxes, found the recession got worse, and then lowered them to make the 1990’s one of the most successful economic periods. Upon inheriting a normal cyclical recession at the end of the Clinton era, and 9-11 which saw the bond market collapse, Bush lowered taxes and we saw a six year run of a strong economy.

So now, the question for President Obama is… if raising taxes brings less prosperity and dollars for the Treasury, why do it? He is not ignorant of the historical evidence that leveying higher taxes decreases government revenue. AND he does understand that higher taxes diminish the private sector. This is the strategy that he is counting on to make government stronger.

As the private sector strengthens, government weakens. By weakening the economy the Administration and supporters in the Congress and Senate aim to increase government’s relative power. Their enemy is the private sector. The expedient approach to defeating this enemy is to raise taxes.

Ask yourself…would you rather pay more taxes so you have less to spend on groceries, or pay less taxes so you have more to spend on groceries? Who’s your ally? Who’s your enemy?