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Sat, Jan. 25

Letter: History proves tax cuts fix economy


Kathy Svendsen has a total misunderstanding of income redistribution and the effect of tax increases.

Ronald Reagan fired the striking government air controllers, as government employees cannot strike. It was FDR and the Congress who passed a law that government employees cannot strike. The concern was that government employees could shut down a particular branch of government over a wage dispute. So the government air controllers lost their jobs and others stepped in. That is an exchange of employees or jobs lost and jobs gained, and nothing to do with income redistribution.

The bailing of the savings and loan companies and large corporations resulted in losses to investors and taxpayers, which is certainly not income redistribution. There was no income redistribution, only losses - or maybe loss redistribution.

The U.S. deficit for the last two years is $2.7 trillion, which is 39 percent of the government expenditures. The only way to reduce this runaway deficit is to cut spending. You cannot tax your way out of this. Three presidents have demonstrated that tax cuts fuel the economy. The Reagan tax cuts produced a 75 percent increase in tax revenues over eight years, the highest percentage increase so far. Obviously, the Democrats do not understand that tax cuts fuel the economy. It is the small business owners in the upper income that produce 75 percent of the jobs. When their taxes are raised, unemployment will increase.

President Obama's threats to raise capital gains tax rates, corporation tax rates and tax rates of the wealthy has put our economy on hold, at best. The investors, corporations and business owners are holding back hiring and investing in new products until they can determine the outcome.

By the way, what really took this country out of the Depression was World War II. Government social programs are funded by tax revenues or taxpayers.

Kathy Svendsen is playing the Obama class card, of sacrificing the middle and lower income classes, seniors, sick, children and you name it. To be informed and educated, one must look at the available data of U.S. tax revenues, expenditures and tax rates for an understanding of how our economy grows.

Jerry Fowler


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