| Although the effect of income tax rates on our | | | | average during the '80's even though the top |
| economy and economic growth always leads to a | | | | federal tax rate was slashed to 48.4%. During the |
| lively debate, never is the question more pertinent | | | | 1990's the maximum tax rate was lowered once |
| than during a recession. So we must ask: Do | | | | again, down to an average of 36.7%, and the |
| higher taxes on the top income brackets lead to | | | | economic growth that had been promised time |
| slower economic growth? Conversely, do lower | | | | and time again? Real GDP per capita only |
| taxes on the wealthiest Americans always create | | | | managed to grow a paltry 1.99% annually. |
| untold new wealth which will trickle down to the | | | | President George W. Bush spent a great deal of |
| rest of the economy? | | | | time and political capital lowering taxes on the |
| At this point we are not interested in opinions, | | | | wealthiest Americans and what did it bring us? |
| only facts. And to answer the above questions, | | | | From the beginning of 2001 to the end of 2006, |
| we must consider the following economic facts. | | | | growth of real GDP per capita dropped to an |
| During the 1960's the highest federal income tax | | | | annual average of 1.53%. That's less than half of |
| rate, applicable to only the wealthiest of | | | | the rate of real economic growth experienced in |
| Americans, averaged 89.4% while real GDP per | | | | the '60's when federal income taxes on the |
| capita grew an average of 3.5% per year. In the | | | | wealthiest Americans were over twice as high. |
| '70's, the maximum federal tax rate was lowered | | | | We currently hear a renewed cry out of |
| to an average of 70.2% yet the real GDP per | | | | Washington that the tax rates on the highest |
| capita only grew an annual average of 2.3%. | | | | income brackets once again must be lowered to |
| 1980 brought us Ronald Reagan and supply side | | | | stimulate our economy and bring us out of the |
| economics. And the solution provided by | | | | current recession. But, as history shows, lowering |
| Washington to correct the slower economic | | | | taxes on the wealthy won't automatically lead to |
| growth of the 1970's was, you guessed it, lower | | | | an expanding economy. In fact, over the last fifty |
| taxes on the wealthiest Americans. However, real | | | | years history has consistently shown when the |
| GDP per capita dipped slightly to 2.28% on | | | | top tax rates are lower, the economy is slower. |