Conor Lamb doesn’t understand the economics of tax reform – Washington Times

Conor Lamb doesn't understand the economics of tax reform – Washington Times.

Voters in Pennsylvania’s 18th Congressional District get their chance this week — in a March 13 special election — to weigh in on the recent tax reform legislation that did not receive a single Democratic congressional vote. Democrat Conor Lamb is on the attack over tax reform, pledging to join congressional Democrats who want to repeal the recently enacted sweeping tax cuts that are already restoring wage increases, creating new jobs and spurring economic growth for average Americans.

His election would be seen in Washington as the people endorsing exactly that. His defeat would be seen as the people endorsing the tax cuts and the liberation of growth that has already ensued

Repealing the tax cuts would mean a murderous tax increase that would smother in its crib the just-awakening and long overdue economic recovery denied America through eight long years of botched Obama national economic policies. Republican state Rep. Rick Saccone, who opposes Mr. Lamb, would join Republicans who want to make all the tax reform tax cuts permanent, especially those for working people and the middle class.

Liberal Lamb is promising to take us back to what did not work. In repealing the tax reform, he would cancel the $2,000 a year in direct tax cuts now going to middle-class blue collar workers and their families, what the House Minority Leader, one of the wealthiest members of Congress, calls “crumbs.”

When President Trump took office, one of the obstacles confronting America’s economy was the world’s highest corporate and business taxes, averaging 40 percent or more including state corporate taxes. Countries around the world had been cutting their corporate rates for two to three decades, to an average rate of 18.9 percent in Europe and 20.1 percent in Asia, about half of America’s corporate and business tax burden.

Nations worldwide were doing that based on the latest economic studies confirming that 70 percent to 90 percent of corporate and business taxes are actually borne by workers in the form of lost jobs and lower wages. The Trump-Republican tax reform cut the federal corporate income tax rate from 35 percent to 21 percent to benefit American workers the same way.

But Conor Lamb is apparently confused by this, following the Schumer-Pelosi line and calling the corporate rate cuts a “corporate giveaway.” He says tax reform’s $1.5 trillion increase in the deficit could have been avoided by skipping the corporate and business rate cut altogether.

But that kind of thinking is exactly what kept America in long-term stagnation under the Obama Democrats. President Kennedy cut tax rates by more than 20 percent across the board, reducing the top rate from 91 percent to 70 percent. The economy boomed, and revenues increased as a result the very next year and throughout the 1960s.

Ronald Reagan cut tax rates by 25 percent across the board, slashing the top rate from 70 percent to 28 percent. The economy took off on a 25-year economic boom, and federal revenues didn’t implode as liberals predicted but doubled while Mr. Reagan was president. The top 1 percent paid a higher percentage of the total tax burden as a result.

Economists say blue-collar and middle-class families will see a $4,000 increase in income due to the corporate rate cuts that Mr. Lamb wants to reverse. That wage increase is in addition to the $2,000 direct tax cut for average families in the Republican tax reform.

But like other Obama Democrats, Mr. Lamb doesn’t understand economic growth or how tax rate cuts produce growth and actually raise revenues and reduce deficits, as Mr. Kennedy and Mr. Reagan did. This confirms the yawning gulf between today’s “progressive” Democrats, and the Kennedy “blue dog” Democrats of old.

Mr. Lamb is also like other Democrats today who do not understand how Mr. Trump’s deregulation, particularly liberating American energy producers to dominate world energy production, also contributes to booming economic growth. Obama Democrats like Mr. Lamb tried to shut down coal production, even throwing coal miners out of jobs and decimating major portions of our nation.

Today, America has the resources to lead the entire world, even the Saudis and Russians, in oil, natural gas and coal production. American energy independence, even dominance as Mr. Trump says, means America would also lead the world in total economic production, including the restoration of energy — intensive manufacturing, and the American Dream.

• Lewis K. Uhler is founder and chairman of the National Tax Limitation Committee and National Tax Limitation Foundation. Peter J. Ferrara is a senior fellow with the Heartland Institute and National Tax Limitation Foundation.

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