Posted on 09/30/2022 9:56:17 AM PDT by ChicagoConservative27
The British pound hit a record low against the dollar on Monday after UK Prime Minister Liz Truss, a fan of “trickle-down economics,” announced a sweeping spending and tax cut plan to rescue the British economy from recession on Friday.
What’s happening: Investors were taken aback by the new government’s choice to institute its largest tax cut in 50 years while boosting government spending and borrowing with inflation near 40-year highs. Citibank analysts called the decision a “huge, unfunded gamble for the UK economy.” Markets dropped precipitously on the news.
But Truss took a cue from former US President Ronald Reagan as she defended her actions. The government is “incentivizing businesses to invest, and we’re also helping ordinary people with their taxes,” she told CNN’s Jake Tapper last week, referencing Reagan’s trickle-down ideals.
So is she right? Let’s dust off our history books and see.
Interesting parallels: When Reagan arrived in Washington in 1981, inflation rates were nearly 10% and tight monetary policy had taken interest rates to over 19%. But much like Truss, Reagan argued that massive tax cuts and deregulation would stimulate productivity and he championed a sweeping tax cut that was passed by Congress that year.
Truss’ government points to that as proof that lowering taxes doesn’t necessarily drive up prices. Inflation fell and growth surged under Reagan, it says.
But the policy came at a price. According to US Treasury estimates, Reagan’s tax cuts reduced federal revenues by about 9% in the first couple of years. Meanwhile, unemployment kept rising.
(Excerpt) Read more at cnn.com ...
Why was he re-elected by a wide margin?
Well he’s the first president to ever tax Social Security. As if the checks aren’t small enough. I suppose I’ll find out in 15 years how embarrassing low the checks are. That was a tax hike if you ask me.
I would think the opposite, that Truss (2022) is ripping-off from Reagan (1981) but we are talking CNN here.....
Whether Truss’ plan is successful or not remains to be seen.
The question to ask this author is why had revenues doubled by the time he left office and inflation dropped.
I think that was Clinton. He made a big cut into it, after all those years of charging that Republicans wanted to take away sosh security.....
Complete and total leftist bs.
> This author is a ditz <
The author is a propagandist. Here she slams Truss for her “unfunded” tax cuts. But I’ll bet you a British pound she was silent when Biden pushed his many unfunded programs.
Here's government revenue in the BR era (Before Reagan):
FY 1977 $356 billion
FY 1978 $399 billion
FY 1979 $463 billion
FY 1980 $517 billion
Here's the wonderful DR era (During Reagan):
FY 1981 $599 billion
FY 1982 $618 billion
FY 1983 $601 billion
FY 1984 $666 billion
FY 1985 $734 billion
FY 1986 $769 billion
FY 1987 $854 billion
FY 1988 $909 billion
Conclusion: Government revenue increased bigly under Reagan even while Reagan was mostly getting government out of our way.
Source: https://www.thebalancemoney.com/current-u-s-federal-government-tax-revenue-3305762
No; it’s taxed on those that are/were still working. And most likely that was a compromise with the Democratic congress of that time.
Reagan didn’t get the spending cuts he wanted hence the 9% deficent. Reagan had another priority and that was defense spending to defeat the Soviet Union,which was a success.
Liberal lying again.
Lying about what really happened under Reaganomics has become an Olympic sport for liberals.
Reagan’s tax cuts reduced federal revenues by about 9% in the ***first couple of years.*** being the operative part here and then it took off...
Note how CNN is once again rewriting history. And for once, you and I agree on something! Lol…
Cutting taxes without controlling or cutting spending is a recipe for government by credit card - the only thing worse than tax and spend is spend and borrow.
Yes revenues increased but we didn’t reign in spending. There are two parts of the equation and Reagan and Tip failed us on that.
I’m with her on the tax cut part but not coupling it with Keynesian government spending part. Just cut taxes like Reagan did and let consumer spending of the tax savings, not government spending, create gdp growth and economic activity
On that we're very much in agreement. The same with the Bushes and Trump (even if you look only at Trump's pre-covid spending).
In my lifetime the only Republicans to cut back on spending where the Contract with American Congressmen in the mid-1990's.
congress should always get blamed for spending, not presidents ...
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