Monday, July 10, 2006

Bush Raises Taxes Big Time

The policies of President George W. Bush has caused the money to roll in to federal, state, and local coffers. See Surprising Jump in Tax Revenues Is Curbing Deficit New York Times July 9, 2006 article by Edmund L. Andrews. Of course, when criticized that the Bush tax cuts were giveaways to the rich, President Bush maintained that it was designed to stimulate the economy which would lead to higher government tax revenues.

In the article:
Ø “An unexpectedly steep rise in tax revenues from corporations and the wealthy is driving down the projected budget deficit this year, even though spending has climbed sharply because of the war in Iraq and the cost of hurricane relief.”
Ø “the tax receipts will be about $250 billion above last year's levels and that the deficit will be down “Tax revenues are climbing twice as fast as the administration predicted in February, so fast that the budget deficit could actually decline this year.”
Ø “the Congressional Budget Office reported that corporate tax receipts for the nine months ending in June hit $250 billion — nearly 26 percent higher than the same time last year — and that overall revenues were $206 billion higher than at this point in 2005.”
Ø “could shrink the deficit this year to $300 billion, from $318 billion in 2005 and an all-time high of $412 billion in 2004.”
Ø “Republicans are already arguing that the revenue jump proves that their tax cuts, especially the 2003 tax cut on stock dividends, would spur the economy and ultimately increase revenues.”
Ø “The jump in receipts is providing Mr. Bush and Republicans in Congress with a new opportunity to assert that tax cuts of 2001 and 2003 are working and that Congress should make them permanent.”
Ø “Domestic discretionary programs, like education and space exploration, have slowed their growth after climbing rapidly in Mr. Bush's first term. But entitlement programs, particularly Medicaid and Medicare, are climbing rapidly as a result of rising medical prices and Mr. Bush's prescription drug program.”
Ø “Tax receipts amounted to about 17.5 percent of the nation's gross domestic product in 2005 … below the average of 18 percent since World War II. Spending, by contrast, is running at about 20 percent of gross domestic product.”


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