Every time Joe Biden says something about tax policy, I have to go back and write another riff to rebut all of his falsehoods. I'm so tired of this game. Today in Scranton, Biden put out yet another phony tax talking-point paper with untruth after untruth. It's pure class warfare.
Millionaires are bad! Billionaires are worse! And if somebody makes a million bucks, some middle- or lower-income family loses a million bucks, but that is not how our capitalist economy works.
It's not a zero-sum game. As the late Congressman Jack Kemp said many years ago, in fact, borrowing from President John F. Kennedy, "a rising tide lifts all boats." Incentives matter. If you encourage work and investment with lower tax rates, you will get more work and investment. As Art Laffer has said thousands of times: Tax something less, you get more of it. Tax something more, you'll get less of it.
LARRY KUDLOW: BIDEN'S 'DON'T' IS JUST FAILED US DETERRENCE
Economic returns after tax (and after inflation) matter for individual or business economic decisions. Biden's latest so-called tax factsheet is just so utterly and completely wrong factually. I mean, it's OK to have your own opinion about how the world works, but it's not OK to make up your own facts. This whole Biden diatribe against Donald Trump's 2017 tax cuts is wrong.
I'll just put out a few facts, because I've done this so many times and it's a wearying exercise, but here it goes. For the entire Trump term, real weekly earnings for typical working-class families went up 9.2%. That's for the entire Trump term. So far, under Biden’s three years-plus, they've fallen 4.5%.
The biggest gainers from the Trump tax cuts were the middle- and lower-income earners, the bottom quintiles. In fact, the lowest 20% had the biggest gain.
Then, poverty dropped all the way down to a record low of 7.8% under Trump. Under Biden, so far, it's 12.4%. Unemployment for Blacks, Hispanics, Asian-Americans and women dropped to record lows under Trump. A recent National Bureau of Economic Research study showed that worker wages were the biggest beneficiary of the Trump tax cuts, and revenues over a few years actually broke even.
Biden is blathering on that corporations don't pay taxes, only the wealthy benefited, the deficit expanded over $5 trillion, and on and on... None of it is true.
By the way, no administration has given out as many tax credits and subsidies through the tax code as the Bidens' Green New Deal and misnamed Inflation Reduction Act, which has kept the budget deficit at around $2 trillion a year and is one of the greatest corporate welfare slush funds in history and, incidentally, wealthy people living in the cities and suburbs on the east and west coasts screamed like stuck pigs when Trump lowered the SALT tax deduction to only $10,000, and that's why the percentage income gains for the middle- and lower-income workers were higher than for the upper end.
Meanwhile, Joe Biden wants to roll back all the Trump tax cuts and institute various wealth taxes on unrealized capital gains and other asset confiscation that probably comes to around $5 trillion in higher taxes, and Mr. Biden is still spending at a rate of 24% of GDP or more with massive additional spending plans if he ever gets re-elected.
The inflation rate has gone up 19.4% since Biden took office and personal borrowing costs have skyrocketed. Another recent NBER paper suggests the actual inflation right now could be 7%, but putting all the numbers aside, think of it this way: Donald Trump cut taxes and the entire economy benefited.
The bottom 20% benefited the most, but a rising tide lifted all boats. Today, the day after Tax Day, Joe Biden is out there in Middle America boasting about how much he will raise taxes. That means a falling tide will sink all boats. What a loser's message! I'm sure this is not the last time I'm going to have to write this article.
This article is adapted from Larry Kudlow’s opening commentary on the April 16, 2024, edition of "Kudlow."
