Yesterday CNS News reported that President Obama stated in a speech:
“If taxes consumed less of America’s wealth, as some Republicans would like, it would not be possible to have a “modern industrial economy,”
That idea simply does not line up with the views expressed by the men who founded America or the practicalities of a free society.
The article further reports:
“Right now, we’ve got the lowest tax rates we’ve had since the 1950s,” Obama said during a lengthy reply.
The article posted a response by Michael Tanner of the CATO Institute:
Tanner said Obama was correct to say that tax revenue as a percentage of gross domestic product was lower than in the past. However, he pointed out that the Congressional Budget Office projects it to be higher than average by the end of the decade. Also, government spending is 25 percent – much higher than in the 1990s, when it was about 18 percent.
“If you look at it as a percentage of the economy that is being taken in taxes, we are at a low point right now, largely because of the recession,” Tanner said. “CBO predicts we will be up well above the historic average by the end of the decade. Historically we take in a little over 18 percent. CBO says it will be around 20 percent by the end of the decade.”
Higher taxes do not create a growing economy–they discourage growth in the private sector. The 2012 election will be a referendum on which philosophy the American voters agree with.