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The Tax Cut Affect

Written March 28th, 2004

Tax cuts have fueled much of the current expansion. In our consumer driven economy, a few extra dollars for each family each month equals a lot more consumer spending.

GDP Chart

This year will prove to be similar to the last two, where tax cuts—first in the form of rebate checks, and now income tax refund checks—will enable continued economic growth.

The current expansion, which began in the fourth quarter of 2001, will be on the edge of a fourth year when election time rolls around this fall. The estimated 4-5% growth rate for this year bodes well for President Bush. Traditionally a growth rate above 3.5% has translated into re-election for an incumbent President.

Liberals can whine about payroll jobs all they like. Similar tactics from the 1980s over "service sector" jobs did not win them any elections, either. The proof that Americans are working improving their economic situation transcends any one economic poll. When unemployment goes down and GDP rises, one must conclude that more Americans are working, whether it is via "traditional" payroll jobs at large firms or other types of jobs such as contract positions, consultants, business owners and commissioned sales agents.

Personal Income Chart

When George W. Bush took office the nation was sliding into a recession, and would suffer a horrible terrorist attack within a few short months. Despite those obstacles, the nation has since embarked on a long economic expansion, watched successful campaigns in Afghanistan and Iraq, watched as allied forces captured or killed a number of top members of al Qaeda and Saddam Hussein's totalitarian regime and viewed the corporate criminals of the 1990s being brought to justice. It is quite a change from the bubble-economy, anything-goes era of the previous administration.

When voters step into the booth in November, they will be able to say with great certainty that they are better off now than they were at the start of the Bush administration.

Tax cuts have fueled much of the current expansion.



The estimated 4-5% growth rate for this year bodes well for President Bush.



The proof that Americans are working improving their economic situation transcends any one economic poll.


Artists

[Voters] are better off now than they were at the start of the Bush administration.




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