Cutting taxes raises revenue - again and again and again.
|The Honorable John W. Snow
Prepared Remarks to PricewaterhouseCoopers 2005
Global Tax Symposium
Good afternoon; thanks so much for having me here. Your symposium comes at a critical time, as major decisions impacting tax policy are pending on Capitol Hill. Talk of raising taxes is coinciding with clear, outstanding evidence of how effective lower taxes have been. Furthermore, the economic future looks bright why would we change course? Raising taxes on investment would harm the economic recovery America has been enjoying.
In just the last week, we've learned that GDP growth was a robust 4.3 percent in the third quarter. That's strong growth for any time, and it happened when the country faced devastating natural disasters.
We also learned on Friday that 215,000 jobs were added to the payrolls in November. Job creation is the reward of strong economic growth, and November's employment report brings the total of jobs created since May of 2003 to four and a half million -- with 1.8 million new jobs created this year alone.
Wages, by the way, will be the next number to rise. Historically, when an economy enters a recession, business income tends to fall more rapidly than the incomes of workers. In the early stages of the economic expansion that follows, income tends to rise faster for business than for workers. Ultimately, however, there is always a tipping point, when incomes rise for workers and business combined, but workers once again increase their incomes faster than businesses. We're approaching that tipping point now. Once businesses have been doing well for a while, they ultimately compete those increases in income away by competing harder for labor. The result is higher wages and higher standards of living for workers.
The fact that payrolls have been growing for thirty straight months and we were able to achieve jobs gains even through a massive natural disaster like Hurricane Katrina suggests we are getting closer to the point when workers receive a greater share of economic gains. Workers can look forward to good days ahead.
All of these are the unmistakable hallmarks of a strong economy, and each one is encouraging news for America's families.
But the past 30 months have demonstrated just how powerful those reforms were and how mistaken our critics were. The evidence that that was the right policy prescription for America stream in every day:
4.5 million new jobs created;
unemployment running lower than the 1970s, 1980s and 1990s;
GDP growth averaging over 4.0% annually;
household wealth at an all-time high;
federal revenues increasing;
U.S. equity markets rising steadily;
Dividends paid to shareholders millions of whom are senior citizens and middle class are up.
There are a lot of things you can say about these statistics, but neither "tragic" nor "reckless" come to mind.