Interesting. It dropped from +2.4 to +0.2.
The drop to 0.5% occurred 8 quarters in.
Yes, it dropped from +4.5 to +0.5.
So, after the talk of a hike, growth dropped 4.0%. The Bush drop was 2.2%.
You never told me why the 4Q93 growth was so high.
I guess your entire point is that people don't change their behavior when tax rates change?
The entire point is really that the tax rates don't have as much of an influence on behavior as people may want to think. That doesn't justify high taxes or out of control spending. What I see looking at historical data is that there is little statistical significance to tax rate changes and longer term growth. I know that a marginal tax rate of 32% instead of 28% is not going to get me to stop working for pay raises, so similarly a drop is not going to get me to change, either. It *may* affect the way in which I deal with my finances. For example, post 2003, I went more for capital gains and dividends. Pre-03, I had a more balanced approach. In either case, my money was available for investment. Most people are the same (even if your money is in the bank, the bank loans it out for investments).
I just don't see evidence that growth is any better than coming out of other recessions. Growth HAS become more stable over the past 30 years, though... that leads to a more stable job market. Tax cuts are good. But if you don't get an unusual spurt to make up for lost revenue, you'll end up with massive deficits unless spending is cut at the same time. The current government didn't manage to do that, and the $600 billion hole we're looking at for this year is evidence....