In 1993, Republicans Said Clinton Tax Increase on Rich Would Lead to a Recession – The Economy Boomed Instead

by on December 7, 2012 · 1 comment

in Government, Politics

Reposted from the Daily Change

Republicans are doing everything they can to protect the Bush tax cuts for the wealthiest Americans. They claim that they are doing this because ending these tax cuts would harm the economy.

But this claim isn’t new. In fact, it’s exactly what they said in the 1990′s, when Bill Clinton first increased taxes on the wealthy. Here’s some of the fear-mongering they engaged in then:

THE HERITAGE FOUNDATION:Heritage, the go-to think tank for the Republican Party, argued that the tax increase would somehow lead to “higher deficits” and that it served as a “recipe for a recession.” The organization also predicted that the tax increase would “destroy jobs” and “undermine America’s international competitiveness.”

REPRESENTATIVE JOHN BOEHNER (R-OH): “The problem in not that we do not tax enough, it is that Government spends too much. The President has reverted to true form, that of a tax and spend, old-time Democrat. He has abandoned tens of millions of middle-class voters that trusted him. Raising taxes on the middle class is not patriotic, it is idiotic.” (From the Congressional Record on February 17th, 1993)

SENATOR ORRIN HATCH (R-UT): ”Mr. President, taxpayers will adjust to these new taxes by shifting investments into ones that generate fewer taxes by working less and by taking fewer risks. The consequences will punish far more than just the wealthy. Economic growth will slow and fewer jobs will be created.”  (From the Congressional Record on August 6th, 1993)

SENATOR MITCH MCCONNELL (R-KY): This package contains the largest tax increase in history, and promises deficit reduction. This package will not reduce the Federal debt, or even balance one annual budget for that matter. (From the Congressional Record on August 6th, 1993)

SENATOR CHUCK GRASSLEY (R-IA):
Mr. President, I really do not think it takes a rocket scientist to know this bill will cost jobs. (From the Congressional Record on August 6th, 1993)

REPRESENTATIVE PETE HOEKSTRA (R-MN): ”Mr. Speaker, I hear, once again, like 1989, claims that by increasing taxes we will be able to shrink the deficit and fund new programs. But as history has shown us over and over, the only result of more taxes is more spending and bigger Government. Let us cut spending, not raise taxes.” (From the Congressional Record on March 16th, 1993)

REPRESENTATIVE BILL ARCHER (R-TX): ”I would much rather be here today supporting the President and I would do so if his proposals could expect to increase jobs and the standard of living for Americans, but I believe his massive tax increases will do just the opposite.” (From the Congressional Record on May 24th, 1993)

REPRESENTATIVE NEWT GINGRICH: ”I believe that that will in fact kill the current recovery and put us back in a
recession. It might take 1 and a half or 2 years, but it will happen.” (From the Congressional Record on February 2nd, 1993)

REPRESENTATIVE PHIL CRANE (R-IL): ”President Clinton has been trying to sell his plan to the American people by claiming that it will create both tax fairness and economic growth. However, history proves that the tax increases which the President advocates will actually stifle economic expansion and the creation of jobs.” (From the Congressional Record on March 16th, 1993)

REPRESENTATIVE JIM SAXTON (R-NJ): “A tax is a tax is a tax; it does not matter what we call it. One might ask, when is enough enough. Tax increases did not work in 1986 or in 1990 to help our economy grow.” (From the Congressional Record on February 16th, 1993)

SENATOR DON NICKLES (R-OK): This tax bill…will not get the deficit down. What it will do is it will give him a lot of new money to spend. We will pass a National Service Program tonight. It is going to cost billions of dollars…There is no deficit reduction in this bill. (From the Congressional Record on August 6th, 1993)

REPRESENTATIVE CURT WELDON (R-PA): ”I spoke with the chief financial officer of Owosso, George Lemmon, Jr., and he told me: `These taxes will mean that we will take fewer risks, we will make fewer investments, and we will have less working capital.’ What does that mean? It means lower economic growth and fewer jobs.” (From the Congressional Record on July 15th, 1993)

REPRESENTATIVE WILLIAM BAKER (R-CA): “Just when the economy is emerging from a recession caused in part by high taxes
the President proposes to slam the brakes on the recovery with his tax bill. This tax package
will reduce productivity and consumption , which will slow down a gradually recovering
economy and cause another recession.” (From the Congressional Record on June 9th, 1993)

REPRESENTATIVE CHRISTOPHER COX (R-CA): “This is really the Dr. Kevorkian plan for our economy. It will kill jobs, kill businesses, and yes, kill even the higher tax revenues that these suicidal tax increasers hope to gain.” (From the Congressional Record on May 27th, 1993)

REPRESENTATIVE BOB GOODLATTE (R-VA): “Small businesses generate the bulk of this Nation’s new jobs . And they will be the hardest hit by the Clinton tax-and-spend budget. Because , when you raise taxes , you killjobs . When you raise taxes , consumer prices inevitably rise, demand falls off, and small businesses begin to collapse.” (From the Congressional Record on July 13th, 1993)

As we now know, the Clinton tax hikes on the richest Americans did not result in a “recession.” They did not increase our deficits. Rather, the government was placed on a path to a surplus and we had a strong economy that created 22.7 million jobs. Average weekly wages grew by 21 percent from the start of Clinton’s first term to the end of his second term. These wages only grew by 2 percent during George W. Bush’s two terms. This isn’t to say that tax increases on the rich necessarily create jobs, but the evidence shows that they do not harm the economy in the ways that Republicans are claiming.

Recall that every single Republican in both the House and the Senate voted against the Clinton tax increase on the rich. As Republicans circle the wagons to protect the rich, we should remember how they made outlandish predictions in the 1990′s, and how their dire words are no more true now.

This post originally appeared in The Daily Change, the blog of the Progressive Change Campaign Committee

Thanks to PCCC researcher Ethan Schwartz who provided research help for this post.

{ 1 comment… read it below or add one }

avatar John P. Falchi December 7, 2012 at 5:31 pm

The Republicans continue to preach the merits of a trickle down economy. Unfortunately, the economic record indicates that, instead of benefiting the economy, and the poor, by lowering the taxes on the rich, the result has been economic catastrophe and recession. Since the advent of this thrust to our economy the poor have gotten poorer as the rich have gotten richer. It is high time that we reversed this horrible trend.

Reply

Leave a Comment

Older Article:

Newer Article: