Some members of the House Freedom Caucus are advocating for significant spending cuts to offset the purported costs associated with the proposed tax cuts. It has been proven time and again—going back 2500 years—that reducing the tax burden on people encourages productive activity and trade, resulting in an increase of overall revenue for the Treasury.
When you combine President Trump’s extension of his 2017 tax cuts, which expire at the end of 2025, with his additional tax reduction proposals (e.g., no tax on tips or social security and lower corporate tax rates), along with tariffs, massive deregulation, stepped-up energy production, reducing the size of government, selling unused federal government property that is expensive to maintain, and substantially reducing waste, fraud and abuse within the administrative or deep state, there is absolutely no need for Congress to identify specific offsetting spending cuts! Wakeup Republicans and do the right thing, i.e., stick together and let President Trump Make America Great Again!
Roughly 2500 years ago, the ruler of the Qi Dynasty, Duke Huan, asked Guan Zhong, who served as the Prime Minister, how to raise more revenue, Guan Zhong advised him to implement a policy of “light taxes and heavy duties.” This meant reducing the tax burden on the people while encouraging them to engage in productive activities and trade. By doing so, the State’s economy would flourish, and the overall revenue would increase as a result of the increased economic activity. The State of Qi became one of the most prosperous and powerful states during that period. Guan Zhong’s policies and reforms are still studied and admired for their wisdom and effectiveness. Unbeknownst to most people, President Trump is proposing “light taxes and heavy duties,” not necessarily because he is aware of the success of the Qi Provence 2500 years ago, but because of his business background and, as he likes to say, “common sense.”
The Founders and Framers of the United States of America also believed, to a limited extent, in “light taxes and heavy duties.” They believed that direct taxes (e.g., taxes on the wages of labor or the income tax) were dangerous and natural to slavery, while indirect taxes or taxes on the sale of merchandise (e.g., tariffs) were more natural to liberty. That’s why there was no federal income tax while our Founders were alive; and for the first 168 years of our existence the primary source of federal revenue was from excise taxes and customs duties or tariffs. In other words, the Founders believed in NO “light taxes,” only “duties” or taxes on consumption, which include tariffs.
More recently, Dr. Thomas Sowell, Ph.D. in Economics, examined historical data going back over 150 years. He explored several major tax cuts, including those implemented during the presidencies of Warren G. Harding, John F. Kennedy, and Ronald Reagan. Dr. Sowell’s analysis demonstrated that tax cuts led to increased economic growth and higher tax revenues, challenging the incorrect notion—held by Democrats and many Republicans—that tax cuts for the wealthy do not benefit the broader economy, or the poor and middle classes.
Dr. Sowell’s study or essay was titled, “Trickle Down Theory” and “Tax Cuts for the Rich.” He described the arguments—by Democrats—about tax cuts being “tax cuts for the rich” as “political rhetoric” and “tax lies for the gullible.” Dr. Sowell argued that this phrase is often used by opponents (Democrats) of tax cuts without considering the actual economic data.
Further pointing out that historical evidence, such as the tax cuts during the Reagan Administration, showed that lower tax rates led to higher tax revenues.
The term “Trickle Down” economics, as Dr. Sowell explained, is a “caricature” and “misleading political rhetoric.” He argued that the phrase is used to oversimplify and misrepresent the effects of tax cuts, which the Democrats always and incorrectly expound that the benefits only reach the wealthy and do not “trickle down” to the poor and middle classes.
The historical data going back 2500 years shows lower tax rates lead to economic growth and increased tax revenues, benefiting a broader segment of society. Federal revenue will indeed increase due to tax cuts. When the Democrats argue otherwise because of increased budget deficits, the deficits are NOT because of lower taxes. The budget deficits are due to increased government spending and overall fiscal policy made by Congress, period!
Don’t be hood-winked by either ignorant or lying politicians!
Learn why President Trump’s tax proposals are sound and why The U.S. Individual Income Tax is Incompatible with a Free Society and therefore, should be abolished. Get a copy of my new book, The Case For Trump’s Tariffs and the Elimination of the Federal Income Tax, available directly from Amazon.com, THE CASE FOR TRUMP’S TARIFFS AND THE ELIMINATION OF THE FEDERAL INCOME TAX: Beard Jr., Robert G.: 9798307013694: Amazon.com: Books.
Read carefully and share with everyone! Let’s ALL help President Trump “Make America Great Again” and save the Republic of the United States of America.
If your Congressional Representative or Senators believe that tax cuts must be offset with specific spending cuts, please send them a copy of this blog, even if they are Democrats. There must be a handful of Democrats that want to do the right thing… maybe they just lack understanding…
Dum Spiro Spero—While I breathe, I hope.
Slàinte mhath,
Robert (Mike) G. Beard Jr., C.P.A., C.G.M.A., J.D., LL.M.