FACT CHECK: Is There ‘No Evidence’ Tax Cuts Lead To Economic Growth?

[Revmitchell]

Former Labor Secretary Robert Reich said there’s no evidence tax cuts have ever led to economic growth on CNN Tuesday.

“The claim here from Republicans is that this is going to be – this is going to add to growth,” said CNN host Jim Sciutto.”Why? You’re going to put more money in the hands of corporations, and that the middle class is going to get a tax cut as well. What’s your response?”

“Well, there’s no evidence that has ever been the case, Jim. The way you grow the economy is you invest in people,” said Reich.

Verdict: False

Many economic studies and historical data suggest that tax cuts can spur economic growth.

Fact Check:

The effect of taxes on economic growth is hotly debated between different schools of economics, with both sides providing evidence to support their claims. The Republican tax plan has intensified that debate. But Reich goes too far when he says there is “no evidence” tax cuts lead to growth.

In a roundup of 26 studies examining the relationship between taxes and economic growth from the Tax Foundation, all but three found that economic growth decreases with tax hikes.

“While there are a variety of methods and data sources, the results consistently point to significant negative effects of taxes on economic growth even after controlling for various other factors such as government spending, business cycle conditions, and monetary policy,” said the Tax Foundation report.

FACT CHECK: Is There ‘No Evidence’ Tax Cuts Lead To Economic Growth?

 

[InTheLight]

Fake News. Basically it's a headline with no evidence.

I believe tax cuts DO fuel economic growth but the article in the link fails to conclude that tax cuts fuel economic growth.

Sent from my Pixel 2 XL

 

[Bro. Curtis]

Fake News. Basically it's a headline with no evidence.

I believe tax cuts DO fuel economic growth but the article in the link fails to conclude that tax cuts fuel economic growth.

Sent from my Pixel 2 XL

Are you talking about the Daily Caller piece or the Robert Reich quote ? Which one is fake, or are they kind of both fake ? Serious question. No “gotcha”.

 

[InTheLight]

Are you talking about the Daily Caller piece or the Robert Reich quote ? Which one is fake, or are they kind of both fake ? Serious question. No “gotcha”.

The entire Daily Caller piece. The question is asked: Is there no evidence that tax cuts lead to economic growth? Then the verdict is stated: Verdict: False

But when you read the article you get vague assertions and dodge 'em answers like this:
"...a tax increase of 1 percent of gross domestic product (GDP) could reduce output by 3 percent over the next three years."

Well, that doesn't prove anything about tax cuts.
Then there is this:
“It’s an undisputed economic reality that if you tax something you get less of it, and if you reduce taxes you get more of it,”

OK, but that doesn't directly say anything about tax cuts spurring economic growth, it's just a generalized statement.

Then there is this:
Other economists, however, argue there’s a lot of reason to doubt that tax cuts boost economic growth. “There have been huge changes in taxes throughout US history with virtually no observable shift in growth rates,” wrote Gale in a post.

That somewhat contradicts the main thesis of the article. Then there is this, which flat out contradicts the idea:
It isn’t a rule that economic growth follows tax cuts.

and

It’s hard to definitively prove the effects of tax cuts on the economy because of numerous factors that impact economic growth like government spending and monetary policy.

and

While the link between tax cuts and economic growth is not definitive

The article basically fails to affirm its verdict.

 

[Bro. Curtis]

Thank you.

 

[Bro. Curtis]

The Heritage Foundation


Try this one.

 

[Revmitchell]

As much as I hate to admit it, I have to agree with Inthedark. The title and article imply that there will an argument forthcoming and there is no argument or evidence to the contrary.

I expected better of Ben Shapiro.

What in the world are you talking about?

In opposition to the claim made by Robert Reich the argument is laid out in the op:

Verdict: False

Many economic studies and historical data suggest that tax cuts can spur economic growth.

The evidence is found in the op in several places:

In a roundup of 26 studies examining the relationship between taxes and economic growth from the Tax Foundation, all but three found that economic growth decreases with tax hikes.

One study from economists at the University of California, Berkeley found that a tax increase of 1 percent of gross domestic product (GDP) could reduce output by 3 percent over the next three years. “In short, tax increases appear to have a very large, sustained, and highly significant negative impact on output,” said the study.

Jeffrey Miron, an economics professor at Harvard University, says historic data shows tax cuts can generate short- to medium-term spurts of growth in GDP.

Many economists say former President John F. Kennedy’s tax cuts for individuals and businesses fueled economic growth in the 1960s. After Reagan cut income taxes in 1981 during a recession, the economy grew substantially – though he paid for those tax cuts with tax increases in other areas the next year.

“It’s an undisputed economic reality that if you tax something you get less of it, and if you reduce taxes you get more of it,” Mark Perry, a scholar of economics at the American Enterprise Institute, told The Daily Caller News Foundation in an email.

So the argument is well supported.

 

[InTheLight]

The Heritage Foundation


Try this one.

Perfect.

Sent from my Pixel 2 XL

 

[Bro. Curtis]

Thankee.