March 1, 2007

History Proves He's Right

Economist Gene Heck says the way to reduce the federal budget deficit even farther than it has already falling in the past year or so of the Bush economic recovery is not just to extend the Bush tax cuts, but to cut taxes even more.

Heck is the author of a new book, Building Prosperity: Why Ronald Reagan and the Founding Fathers Were Right on the Economy. But Democrats, now in control of Congress, want to roll back some of the Bush tax cuts. That would kill 3 million jobs, Heck says.

The Bush tax cuts have also engendered a lasting, dynamic expansion, producing an overall growth in GDP over the last three years that is larger than the entire economy of China.

One of the administration's most important achievements has been tasking the Treasury Department to conduct an analysis that takes into account the growth effect of tax cuts. Using a dynamic economic model, the Treasury Department estimates that without the tax cuts passed in 2001, 2002, and 2003, "as many as 3 million fewer jobs would have been created by the end of 2004 and real GDP would have been as much as 3.5% to 4% lower."

Chew on that one for a while. Maybe President Bush should ask the Democrats exactly which 3 million people who are now working because of the tax cuts they'd like to throw out of work. Or the president could ask how the Democrats could possibly hope to balance the budget with a year or two's worth of economic growth wiped from the books.