John Kerry continues his crusade to talk down the great economy. Stump speech after stump speech Kerry talks about how we are giving tax cuts to the rich at the expense of a growing economy and that we are spending ourselves into oblivion.
From his own web-site:
By borrowing from future generations to give tax relief to those who need help the least, George W. Bush’s economic policies have, for the first time in history, forced the federal government to spend $1 billion more EACH DAY than it takes in.
But little reported earlier this week comes this great news, as reported by Reuters:
WASHINGTON, July 13 (Reuters) - The U.S. government posted a larger-than-expected budget surplus in June, propped up by higher quarterly business tax receipts, a government report released on Tuesday showed.
In the Treasury Department's monthly budget statement, June income outpaced spending by $19.14 billion, slightly less than the government's June 2003 surplus of $21.23 billion.
"What we are seeing is the impact of a good economy, the impact of extraordinarily strong corporate profits, and likely the impact of more people being caught in the alternative minimum tax," Drew Matus, financial markets economist at Lehman Brothers in New York, said in response to the report.
"Surprisingly strong receipts are really helping out a great deal here. There is no reason to suspect, given the employment growth we have seen, that this trend will change any time soon," he said.
Corporate income tax inflows grew 38 percent in June, when quarterly tax statements are normally filed, compared to June 2003. Individual tax receipts were nearly 9 percent higher.
Read that last paragraph closely. Income tax inflows from business grew 38% and individual inflows grew 9%. Wha' Happaned? If you listen to John Kerry you would assume that tax cuts would starve the government of needed funds and eliminate food from the mouths of poor children.
Article comments
1 - David Flanagan
Tom,
Thanks for publishing this information. I meant to do it yesterday but have not had the time. Two quick points and one thought:
1) I've heard NO coverage of this in the mainstream press. When this began happening under Clinton, it was all over the place. No such thing as media bias? Rigghhhhhht!
2) This is EXACTLY what Bush said would happen. As you point out, tax cuts are never a guarantee, but perhaps Clinton's best move during his two terms was to simply get out of the way of American business. I don't believe in big government, I believe in government as facilitator; that is, they protect the people from threats internal and external, and moderate what can sometimes be a ruthless capitalist system.
My last thought is that I believe Bush's get tough policy on Wall Street firms and businesses in the US has led to a more honest system. I know that every officer of our company, because of Sarbanes Oxley, had to sign documents affirming the accuracy of the numbers we are reporting to the IRS and shareholders. Seeing our executives held more accountable is something that I heartily approve of.
They get the big bucks, so they should be held to high standards of corporate citizenship.
Thanks again for your post.
David Flanagan
Viewpointjournal.com
2 - Hal Pawluk
I hope it's a trend, rather than the expected rise because June is when corporations file their quarterly tax returns, and receipts are expected to be higher.
Last year, the feds had an even higher surplus in June yet ended the year with a record deficit of about $376 billion.
The good news is that receipts from corporate taxes are 38% higher than a year ago and individual tax receips are 9% higher so maybe things really are looking up.
On the downside, spending is speeding up, with Defense up 20% and Medicare up 37% .
Even with this good month though, it looks like the budget is still on track to match the record deficit set last year. The deficit so far this year is at $326 billion, compared to only $270 billion for the corresponding period last year.
Let's hope we get a few more good months.
3 - JR
Bush's get tough policy? Why does he get credit?
4 - Tom
Well I think that applies to the Justice Department actively going after people like Ken Lay, Martha Stewart.
A lot of these scandals started during the Clinton years during a time that Janet Reno didn't prosecute anyone.
5 - David Flanagan
Bush's get tough policy? Why does he get credit?
Because Bush, of course, got all the blame from liberals for the Wall Street scandals; and that is despite the fact that most of the problems took place during Clinton's second term.
I don't blame Clinton for these problems, but I do credit the President for not giving Wall Street crooks a pass.
It was Bush's DOJ team that invented the "walk of shame" for those corporate crooks who were being arrested. The NY Times published an article entitled CORPORATE CONDUCT: THE HEADQUARTERS; Satisfaction and Sadness at the Sight of Handcuffs highlighting the latest "walk of shame" recipient, Kenneth Lay.
Thanks.
David
6 - JR
Setting aside the civil liberties questions regarding the "walk of shame", it is a completely symbolic act and does not reflect whether the Justice Department is indeed pursuing corporate criminals with the tenacity and intelligence needed to really bring about reform. Maybe they are, maybe they aren't. They pretty much had to bring down the obvious guys like Ken Lay; but how many criminals are getting away? I've seen too many empty symbolic gestures from politicians to take these things at face value.
But more to the point, Sarbanes-Oxley wasn't written by the Bush administration, so why should he get all the credit for it?
7 - Tom
I do want to concede that if these accounting scandals were never exposed Bush wouldn't have been proactive in seeking this stuff out.
It is like anything; drugs, drunk driving, terrorism; things have to be noticably bad before people will act.
I'm sure if these scandals happened during Clinton's administration, he probably would have acted the same.
8 - David Flanagan
Sarbanes-Oxley wasn't written by the Bush administration, so why should he get all the credit for it?
Because it was a bi-partisan effort that Bush supported and then signed into law. Democrats endlessly accuse Republicans in general and Bush in particular for their "corporate ties." But when Republicans get tough on corporations, close tax loopholes, demand higher standards of accountablity, etc., you could hear a pin drop. I'm not saying that Bush is the only person to get the praise, but he definitely deserves praise for supporting corporate reform and for pushing get-tough standards for how DOJ would handle such scandals.
Bush has been endlessly blamed for our economic woes, which means he gets to take credit for economic recovery.
As for any "civil liberties" questions related to the "walk of shame," there are none. In the past, when federal indictments were issued to wealthy individuals, the DOJ often allowed the person indicted to turn themselves in, but putting them in handcuffs, reading them their rights, and treating them like any other criminal is not an issue.
Thanks.
David
9 - David Flanagan
I'm sure if these scandals happened during Clinton's administration, he probably would have acted the same.
I agree.
David
10 - RJ
"Sarbanes-Oxley wasn't written by the Bush administration, so why should he get all the credit for it?"
Of course the Bush Administration didn't write it. The Executive Branch does not write bills. They either sign them into law or veto them.
Bush signed it (he has NEVER vetoed anything). So, he deserves some of the credit.
11 - Mike Kole
I agree with one thing Kerry is saying: that we are spending ourselves into oblivion. Right on. The deficit problem is precisely that taxes were cut, but spending increased. The tax cut is a great thing, but should have been accompanied by commensurate cuts in spending.
The states also suffer budget problems due to the increased spending that occurred during the late 90s when the economy was riding high. As the recession hit and revenues slumped, spending commitments remained, and largely have not been cut.
I'd like to think that Kerry is addressing budgets across the country, but I know better. The reality is, it doesn't matter whether the Republicans or Democrats are in control of the budgets. They all spend too much.
Vote Libertarian! :-)