The last time the Democrats promised a tax cut

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**Frazzled**

Submitted for discussion:

http://online.wsj.com/article/SB122333585431009523.html

About That Middle-Class Tax Cut . . .
Remember the last time a charismatic Democrat made such a promise?By WILLIAM MCGURN
Article

"It's like déjà vu all over again."
As John McCain heads into the second round of presidential debates tonight, Yogi Berra's words come to mind. Mr. McCain could do worse than remind the middle class what happened to them the last time a charismatic Democratic candidate promised them a tax cut. While he's at it, he might also remind them how much more expensive it will be to send Barack Obama to the White House at a time when his fellow Democrats will have a majority in both houses of Congress.

Bill Clinton promised one in 1992.
The Clinton years hold some good lessons on both these scores. Back when Mr. Clinton was campaigning for president in 1992, he made a pretty direct pitch: Raise taxes on people making more than $200,000, and use those revenues to fund tax relief for the "forgotten middle class."
In an October presidential debate, then-Gov. Clinton laid out the marginal-rate increase he wanted and some of his plans for the revenue that would be brought in. He followed with a pledge:
"Now, I'll tell you this," he said. "I will not raise taxes on the middle class to pay for these programs. If the money does not come in there to pay for these programs, we will cut other government spending, or we will slow down the phase-in of the programs."
Mr. Clinton, of course, won that election. And as the inauguration approached, he began backtracking from his promise. At a Jan. 14, 1993, press conference in New Hampshire, he claimed that it was the media that had played up a middle-class tax cut, not him. A month later, he announced his actual plan before a joint session of Congress.
On page one of the New York Times, the paper described the fate of the middle-class tax cut this way: "Families earning as little as $20,000 a year -- members of the 'forgotten middle class' whose taxes he promised during his campaign to cut -- will also be asked to send more dollars to Washington under the President's plan."
In some ways, we are today reliving the campaign of 1992. As in 1992, the Democrat is promising a middle-class tax cut. As in 1992, the Democrat is hammering the Republican as a tool of the rich. And as in 1992, the Republican doesn't seem to have an answer.
Give Sen. Obama his due. His patter is direct and easy to understand. ("I will cut taxes -- cut taxes -- for 95% of all workers and their families," "if you make under $250,000 a year, you will not see your taxes go up one dime.") And his language about putting working families first is hard to attack as class warfare when his opponent is blaming our financial woes on Wall Street's greed.
But this doesn't have to be 1992 all over again. Not, at least, if Mr. McCain begins to direct his fire as much against the Democratic establishment on Capitol Hill as against Mr. Obama. For one thing, Congress is even less popular than the president. For another, the need for a Republican check on a Democratic Washington is a potent argument.
That was one of the lessons from the Clinton years. For the first two years of his first term -- when Democrats controlled Congress -- Mr. Clinton was a different president. With Democrats in control of Washington, the middle-class tax cut vanished, a massive tax hike was approved, and the political debate centered around HillaryCare.
Then came 1994, the "Contract with America" -- and a reform-minded Republican Congress. Robert L. Bartley, the late great editor of this newspaper, liked to note the bracing effect the 1994 Republican takeover of Congress had on the market -- and the Democratic president. After a few skirmishes, President Clinton would go on to embrace welfare reform, sign a cut in the capital gains tax, and even declare that "the era of Big Government is over."
Barring divine intervention, a President Obama would not have a Republican Congress to worry about. Instead, he would be working with a Democratic speaker of the House who loaded billions in pork onto a bill meant to fund our troops; with a Democratic Senate majority leader who promised to change the way Congress spent but fought earmark reform; and with committee leaders such as Sen. Chris Dodd and Rep. Barney Frank, who did so much to bring us the financial implosion of Fannie Mae and Freddie Mac.
In this kind of Washington, the American taxpayer could use a Gary Cooper: the "High Noon" lawman willing to stand up for us when everyone else is ducking for cover. Marshal McCain, anyone?

**reds8n**

It's like politicians change their minds !

Whilst I do think America seems to "work" better when there is a balance between Congress and the President, do you not think it is disingenuous to judge Obama by Clinton's standards. I see where you're coming from with regards to the situation being quite similar politically. But.... the Clinton reign ( yeah ! REIGN) was pretty successful economically was it not ? And yes, I am sure the later Republican house played a part here too.

.... Question really is do you think McCain would do any better then ?

Oh and we'll get the inexperience thing out of the way too shall we !

**AgeOfEgos**

reds8n wrote:It's like politicians change their minds !

Whilst I do think America seems to "work" better when there is a balance between Congress and the President, do you not think it is disingenuous to judge Obama by Clinton's standards. I see where you're coming from with regards to the situation being quite similar politically. But.... the Clinton reign ( yeah ! REIGN) was pretty successful economically was it not ? And yes, I am sure the later Republican house played a part here too.

.... Question really is do you think McCain would do any better then ?

Oh and we'll get the inexperience thing out of the way too shall we !

Yeah and adjusted for inflation, the Clinton tax years vs the current Bush adminstration isn't 'that' different;

Individual Income Tax Due in 2008,
Bush Law versus Clinton Law

For taxpayers who take the standard deduction and have no children
Taxpayer Tax That Would Have Been Owed under Clinton-Era Tax Law Tax vs. Bush Tax Cuts

Single, income of 30,000: Clinton $3,157.50 Bush $2,756.25
Single, income of 50,000: Clinton $7,262.50 Bush $6,606.25
Married, income of $50,000: Clinton $5,085.00 Bush $4,012.50
Married, income of $60,000: Clinton $6,585.00 Bush $5,512.50
Single, income of $75,000: Clinton $14,262.50 Bush $12,856.25
Married, income of $75,000: Clinton $9,426.50 Bush $7,762.50
Single, income of $125,000*: Clinton $29,378.50 Bush $26,472.25
Married, income of $125,000*: Clinton $23,426.50 Bush $19,462.50
*This chart does not take into account the Alternative Minimum Tax

Source:
http://www.taxfoundation.org/publications/show/23003.html

**Frazzled**

Q: Do I think McCain would do better?
A: No.

**reds8n**

And the deficit under Clinton was.... oh yeah.

@ Mr. Jfrazell : It isn't too late for you to make your run as this is it ? You "speak" to people across the world so you've got more foreign policy experience than Palin.

**Frazzled**

I would posit the deficits are different. Clinton wasn't dealing with a major war. In fact thats part of the problem, that Clinton didn't deal with THE PROBLEM.

Now if I remember correctly the tax rate was 39%. I'd be ok with that, without further taxes on incomes under $250K (if spending is cut at the same time). But I think anyone who believes he's going to cut taxes for anyone is a fool.

**Da Boss**

Sometimes taxes have to go up. Espcecially if things are going badly for less fortunate people.
Yeah, I'm a filthy socialist.

**Frazzled**

But it doesn't help the less fortunate people if they get their taxes raised...

**Mad Doc Grotsnik**

And yet Tax Cuts always benefit the rich more.....

**Da Boss**

Frazzled: Which is why you tax the rich more than you tax the poor.

**Frazzled**

Yes, if you tax the rich more. What I am saying is that

1) The Democratic line is BS (of course the Republican line is likely BS as well). No one is getting a tax cut.

2) History has shown that if you riase taxes on one segment, taxces tend to get raised on other income segments. Thats what I'm thinking is going to happen. Obama has promised subatntial increases in spending, over and above all the bailout stuff. Either he's lying or he's had a break from reality. And of course I'll note the McCain platform is not far behind.

**Redbeard**

The real debate is the definition of 'rich' and 'poor'. Everyone agrees that the rich should pay more. Not everyone agrees that they are part of the 'rich'.

**Da Boss**

True. And at the lower end of middle class is where things tend to get screwy in any case.
Being a civil servant over here is a bit ganky in that way, because a lot of private sector workers can lie about their income and qualify for grants and schemes, whereas the public sector people cannot at all.

**Frazzled**

Redbeard wrote:The real debate is the definition of 'rich' and 'poor'. Everyone agrees that the rich should pay more. Not everyone agrees that they are part of the 'rich'.

To quote Sir Robin the Coward "Oh thats EASY!"

Anyone who makes more than me: RICH
Anyone who makes less than me: Poor

**Redbeard**

That's not a good answer - you haven't told me how much you make ;p j/k lol

**Frazzled**

Way less than I should make...

**sebster**

So Clinton didn't deliver on a promise, therefore Obama won't?

That seems like a pretty long bow to draw.

**Frazzled**

Incorrect. Whats a long bow to draw is that he will be different. What record we have of his does not support a tx cuttin' kind of guy. The problem with a blank slate is that you have to color the canvas with what the party does and what their candidates have historically done.

With $1.0 TRILLION are you supporting a further tax cut?

**AgeOfEgos**

Frazzled wrote:
With $1.0 TRILLION are you supporting a further tax cut?

Short term, we all should. The deficit is destined to increase in the short term considering the hole in which we find our country.

Increase government spending (Infrastructure)
Get out of Iraq
Increase tax cuts

It will raise the deficit short term but pull us out of this mess. I think Obama has this right (and so do many leading economists).

**dogma**

Frazzled wrote:Incorrect. Whats a long bow to draw is that he will be different. What record we have of his does not support a tx cuttin' kind of guy. The problem with a blank slate is that you have to color the canvas with what the party does and what their candidates have historically done.

With $1.0 TRILLION are you supporting a further tax cut?

You've floated this argument before; it made just as little sense then. If you assume that the government is evil, then it always will be. This argument relies entirely on your assumption that everyone is out to screw you. It is not rational reflection; it is a zero-sum fallacy that presumes the relative size of your piece of the pie determines your well-being.

**Frazzled**

You do realize that this increases the national debt by ~50%? We're already getting out of Iraq, thats not going to lower the budget deficit. How about the increases in spending-national healthcare alone will explode the treasury. A tax reduction right now is difficult to support.

**Frazzled**

dogma wrote:
Frazzled wrote:Incorrect. Whats a long bow to draw is that he will be different. What record we have of his does not support a tx cuttin' kind of guy. The problem with a blank slate is that you have to color the canvas with what the party does and what their candidates have historically done.

With $1.0 TRILLION are you supporting a further tax cut?

You've floated this argument before; it made just as little sense then. If you assume that the government is evil, then it always will be. This argument relies entirely on your assumption that everyone is out to screw you. It is not rational reflection; it is a zero-sum fallacy that presumes the relative size of your piece of the pie determines your well-being.

Exqueeze me? Arguing that cutting taxes right now is a bad idea, or arguing that you have to rely on the evidence to gauge whether or not a politician will actually do something. PLease explain to me why I WOULD believe him? As per the debate last week Biden affirmed they aren't going to cut any of their new programs. As of Monday we just committed to a TRILLION dollars in new spending. We're hitting banana republic levels of deficit spending here.

**AgeOfEgos**

Frazzled wrote:You do realize that this increases the national debt by ~50%? We're already getting out of Iraq, thats not going to lower the budget deficit. How about the increases in spending-national healthcare alone will explode the treasury. A tax reduction right now is difficult to support.

Iraq is costing around 3 billion/week. Estimated to be 10-12 billion a month, that money can certainly be invested in our country.

Here is our situation;

World wide cost push inflation
Recession here, perhaps worldwide soon
High unemployment (We've lost 3.1 million manufacturing jobs since 02')

You don't raise taxes on the middle class during a recession. If you have a reduction in consumer spending due to recession, there are a few things you can do; cut taxes, increase government spending (Not overseas in war!), reduce interest rates (another cut coming I'm sure), etc. We are in serious times, the deficit will matter little in the new few years.

**Frazzled**

True that.

I'm betting a small figleaf tax cut if the Democrats are elected, with lots of pork barrel spending.

If the Republicans are elected I'm betting small figleaf tax cut, with lots of pork barrel spending.

Whats the difference you ask? Well, er...uh...

**sebster**

Frazzled wrote:You do realize that this increases the national debt by ~50%? We're already getting out of Iraq, thats not going to lower the budget deficit. How about the increases in spending-national healthcare alone will explode the treasury. A tax reduction right now is difficult to support.

Sbuh? 50%

Total US govt debt is around 9 trillion, so you must be saying that Obama's plans will cost around 4.5 billion...

And the 1 trillion figure is pretty widely discredited, adding up the total cost of reforms over a ten year period, for no other reason that to produce a scary number.

This is junk economics people.

**dogma**

Frazzled wrote:

Exqueeze me? Arguing that cutting taxes right now is a bad idea, or arguing that you have to rely on the evidence to gauge whether or not a politician will actually do something. PLease explain to me why I WOULD believe him? As per the debate last week Biden affirmed they aren't going to cut any of their new programs. As of Monday we just committed to a TRILLION dollars in new spending. We're hitting banana republic levels of deficit spending here.

The argument you floated is one that requires us to rely on circumstantial evidence to predict the actions of a politician. Of course circumstantial evidence is not evidence at all; merely a means by which to exercise an irrational fear of government action.

I agree that cutting taxes right now is a bad idea. Obama's tax plan isn't a tax cut, so it doesn't really matter. That's one reason to believe him.

As for program cuts. Do you expect him to announce that he is going to cut thing mid-campaign. Especially when the entire issue of the budget is far from settled? In any case, the worst that could happen is an appropriation of funds which roughly mirrors the one used to pay for Iraq. Only this money will actually serve a purpose; socially and economically.

**dogma**

Frazzled wrote:True that.

I'm betting a small figleaf tax cut if the Democrats are elected, with lots of pork barrel spending.

If the Republicans are elected I'm betting small figleaf tax cut, with lots of pork barrel spending.

Whats the difference you ask? Well, er...uh...

You mention pork-barrel spending as though it were at all a significant issue. Please. 18 billion dollars is absolutely nothing in context of real government programs.

**Frazzled**

You define it as $18Bn. I define it as most of the spending/tax cuts currently in the budget.

Tax breaks for wooden arrows people?

Edit: My bad. You're right Sebster. The national debt is ~$10Trillion now. Strangely, this fact does not help my dosposition

http://www.federalbudget.com/

**dogma**

Frazzled wrote:You define it as $18Bn. I define it as most of the spending/tax cuts currently in the budget.

Tax breaks for wooden arrows people?

Edit: My bad. You're right Sebster. The national debt is ~$10Trillion now. Strangely, this fact does not help my dosposition
http://www.federalbudget.com/

That's because you seem to believe that corporate America is somehow less capable of doing you injury than a small government. The private sector is just as dangerous as the public. After all, how do you think governments formed but through the actions of powerful private citizens.

**Frazzled**

dogma wrote:
Frazzled wrote:You define it as $18Bn. I define it as most of the spending/tax cuts currently in the budget.

Tax breaks for wooden arrows people?

Edit: My bad. You're right Sebster. The national debt is ~$10Trillion now. Strangely, this fact does not help my dosposition
http://www.federalbudget.com/

That's because you seem to believe that corporate America is somehow less capable of doing you injury than a small government. The private sector is just as dangerous as the public. After all, how do you think governments formed but through the actions of powerful private citizens.

1. That blindingly has nothing to do with anything we've been talking about.
2. Its blindingly in error as to how much harm I think corporate America can do. See: $700Bn bailout.
3. Please point out a time since Kennedy when Democrats have pushed thorugh a significant tax break for the middle class?