Issues Before Congress | |
Clinton No Kennedy -- When It comes To Taxes |
One of President Kennedy's greatest achievements was a massive cut in
taxes; but Bill Clinton probably will mark the anniversary of Kennedy's
tax reduction by vetoing the tax cut Congress will send him in the next
few weeks.
On January 24, 1963, Kennedy said: "It has become increasing clear
that the largest single barrier to full employment of our manpower and resources
and to a higher rate of economic growth is the unrealistically heavy drag
of federal income taxes on private purchasing power, initiative and incentive."
The federal government was running a large budget deficit, but Kennedy
argued "...our choice today is not between a tax cut and a balanced
budget. Our choice is between chronic deficits resulting from chronic slack,
on the one hand, and transitional deficits temporarily enlarged by tax revision
designed to promote full employment and thus make possible an ultimately
balanced budget."
Kennedy offered a seven-point tax program that included a reduction in
the top personal income tax rate from 91 percent to 65 percent and a lowering
of the bottom rate from 20 percent to 14 percent; a cut in the corporate
income tax rate from 52 percent to 47 percent; and a 20 percent decrease
in the capital gains tax. He pointed out that the capital gains tax "directly
affects investment decisions, the mobility and flow of risk capital from
static to more dynamic situations, the ease or difficulty experienced by
new ventures in obtaining capital, and thereby the strength and potential
for growth of the economy."
The Kennedy tax cut was enacted in 1964; but last week, the ink was barely
dry on the House Ways & Means Committee's $80 billion proposed tax cut
when Bill Clinton announced his intention to veto it.
Source: Bruce Bartlett, senior fellow, National Center for Policy Analysis,
September 23, 1998. |
Home | Support Us | All Issues | Social Security | Debate Central | Contact UsDallas Headquarters: 12770 Coit Rd., Suite 800 - Dallas, TX 75251-1339 - 972/386-6272 - Fax 972/386-0924
Washington Office: 601 Pennsylvania Avenue NW, Suite 900 South Building, Washington, DC 20004 - 202/220-3082 - Fax 202/220-3096
© 2001 NCPA