Are Low Taxes Fueling a Booming Economy?
New opinion piece in the WSJ says tax cuts bust "secular stagnation."
The success of tax cuts may be harder to deny after Friday’s report that the U.S. economy grew 4.1 percent in the second quarter.
This growth brought the average quarterly growth rate during the Trump presidency to 2.9 percent, writes Mike Solon, a former policy adviser to Sen. Mitch McConnell and a partner at US Policy Metrics, in a new opinion article for The Wall Street Journal. This growth, as well as the accompanying spikes in hiring and wages, discredits three popular claims made by opponents of Trump’s policies: That tax cuts should create a hole in the deficit, that corporate tax cuts would only serve rich investors, and that secular stagnation was a valid excuse for slow growth during the Obama era.
Solon writes that growth has been almost 40 percent higher during the first five quarters of the Trump presidency than the average rate during the Obama years. Per capita growth in gross domestic product has been 63 percent faster.
In his op-ed, Solon writes: “With any luck, the economic turnaround will bring the pro-growth wing of the Democratic Party out of hiding. Three times in the postwar era, Congressional Democrats joined Presidents Kennedy, Reagan and Clinton to cut taxes and enable growth. America could use that kind of bipartisanship again.”
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