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Tax cuts, job creation, and why the Wall Street Journal is confused
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| Contributor | ArmyDem |
| Last Edited | ArmyDem Feb 06, 2006 03:13pm |
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| Category | Blog Entry |
| News Date | Monday, February 6, 2006 09:00:00 PM UTC0:0 |
| Description | Posted 1:28 pm | Printer Friendly
It's almost amusing to hear the president's allies credit tax cuts for job creation; you'd like to think they'd know better by now. But not the editorial page of the Wall Street Journal, which did a fine job summarizing a poor argument.
Yesterday's report of 193,000 new jobs in January (and a revision of 80,000 more in November and December) was certainly a blunt rebuttal to last week's announcement of weak fourth-quarter GDP. The economy seems to have begun 2006 with a roar. […]
[T]he American jobs machine rolls on. Will the critics now concede that the 2003 tax cuts were not just "giveaways to the rich?"
Alas, the Journal wasn't kidding. First, the job report for January shows a job market that is struggling to keep up with population growth, so I'm not sure what the WSJ is bragging about. Second, the 2003 tax cuts are "giveaways to the rich" because they overwhelmingly and disproportionately benefited those at the very top. And third, as Jonathan Chait noted, if conservatives like those on the Journal's editorial board believe we should praise the 2003 tax cuts for modest job growth, they have a very short memory.
The White House and its allies like to focus on the approximately 4 million jobs that have appeared since the 2003 tax cut. If the year 2003 sounds suspicious, it ought to. Bush first promised that his 2001 tax cuts would create jobs, and then he promised the same thing with a new round in 2002. Instead, the job market kept shrinking. Bush cut taxes again in 2003, and this time jobs came back.
Of course, the job market was bound to bounce back sometime, so if you keep cutting taxes every year, you can just point to your last one and say it did the trick. (Or else all those previous tax cuts failed utterly, in which case we ought to repeal them.)
[Continued...] |
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