Yesterday, in Minnesota GOP uses 9-11 message (& much, much more) on Rally fundraising page, Bluestem introduced readers to the cheap thrill of reading the Republican Party of Minnesota's Rally social fundraising page.
Cheap as in low-cost and not really raising much coin.
Today's entry trashes a statement Governor Dayton made yesterday at the Humphrey Institute:
Can you believe that? Governor Dayton actually said our “unwillingness to pay (more) taxes...is going to be the death of this country [if] it's not corrected."
This statement couldn’t be more bizarre or plain wrong. In fact, the exact opposite is true: our country and others have prospered the most when the people have experienced more freedom and less government overreach into their lives.
One only has to look to the Reagan years, where a bipartisan Congressional majorities cut taxes, reduced job killing regulations, and gave the American people more freedom.
Because of those actions, our country thrived.
Pity the poor pachederms. Last February 2011, Polifact checked out those golden memories of the Reagan era. Here's what the site kept by the St. Petersburg Times found in Judging Reagan's legacy: The Gipper meets the Truth-O-Meter:
Ronald Reagan left the White House more than two decades ago, but he remains a giant -- and sometimes polarizing -- figure in American politics. In honor of the recent centennial of Reagan’s birth, we’ve collected a dozen fact-checks we’ve published over the last three years that judge the late president and his legacy.
Findings related to today's MNGOP fundraising appeal:
Sen. John McCain, R-Ariz.: After Reagan took office, "we didn't raise taxes and we didn't cut entitlements. What we did was we cut taxes."
We found that Reagan signed two major tax increases in 1982 that took back much of the break he'd provided in his 1981 tax bill. After a Social Security tax increase in 1983, Reagan approved further tax increases — in one form or another — in 1984, 1985, 1986 and 1987. On the other hand, taxes as a share of GDP continued to decline until 1984, when they bottomed out at 18.4 percent, before rising back to 19.2 percent by the time Reagan left office in 1989. That rate was lower than during Reagan's first year in the White House. On balance, we rated the statement Barely True.
Ruling: Mostly False | Details
From those details:
. . .Loughlin is echoing a popular Republican theme: If you want to grow the economy, cut taxes. The favorite example is Reagan, who was a big proponent of cutting taxes and reducing government spending. In his ad, Loughlin's unstated implication is that Reagan cut taxes and the economy grew explosively as a result.
But is it really that simple?
First, Reagan alone didn't cut taxes. He did it in conjunction with Congress. Having said that, let's look at the Reagan era of taxation.
There's no debate that Reagan dramatically reduced taxes in 1981, his first year in office. That $38-billion cut would equal $90 billion in today's dollars. At the time, it represented 1.91 percent of the gross domestic product, which is the total value of goods and services produced in the United States during a given year.
But the following year, Reagan raised taxes dramatically and other increases followed.
The 1982 hike alone, which applied to corporations and individuals, increased taxes by about $17 billion, according to a 2006 U.S. Treasury report. The increase represented 0.8 percent of the GDP. That's why it is sometimes billed as the largest peacetime tax increase in American history. That same year he also raised the gasoline tax.
In 1983, Reagan hiked taxes again. This time it was the passage of the Social Security Reform Act of 1983, which increased payroll taxes to provide long-term funding for Medicare and Social Security. According to liberal economist Paul Krugman, in a June 8, 2004, commentary in The New York Times, "this tax increase more than undid any gains from Mr. Reagan's income tax cuts" for many middle- and low-income families.
Reagan also significantly increased taxes through the Deficit Reduction Act of 1984, the Tax Reform of 1986 and the Omnibus Budget Reconciliation Act of 1987. . . .
And job growth following that tax cut?
The other question is, did the original tax cut spark "exponential growth," as Loughlin contended.
Taken literally, "exponential" refers to growth at an ever-increasing rate, as when something doubles, then triples, then quadruples. The economy during the Reagan years did no such thing.
When we talked to Loughlin about that part of his statement, he said: "We experienced additional growth after Ronald Reagan cut taxes and that might be a bit of hyperbole to say 'exponentially.'"
In fact, immediately after the 1981 cuts, the country went into a recession. The GDP dropped by nearly 2 percent. The unemployment rate jumped more than two full percentage points, spiking to 9.7 percent.
Then things got better. The GDP rose 4.5 percent in 1983 and 7.2 percent in 1984. Those are substantial jumps. The increases returned to a fairly typical 3 percent and 4 percent during the rest of his tenure. Unemployment barely declined in 1983, but then began a steady fall to 5.3 percent in 1989, when Reagan left office.
And there's this:
During the Reagan era, while productivity increased, "wages for working people remained frozen."
Michael Moore, Friday, October 2nd, 2009.
Ruling: Mostly True | Details
So things got better during the Reagan era, sorta, but "tax cuts" as most people would understand them so did not happen. And job growth? Not as rosy as Shortage and company remember.
Photo: The ghost of Republican memories.