On June 7, 2001, President George W. Bush signed legislation to disperse $1.35 trillion dollars worth of tax cuts over ten years. Formally known as the Economic Growth and Tax Relief Reconciliation Act of 2001, it was the first piece of major legislation W passed as President.
The proposal dropped tax rates across the board, the lowest bracket went from 15 percent to 10 percent and the highest dropped to 35 percent from 39.6 percent. Cuts to the estate tax and capital gains tax were also included in the package.
The cuts were designed to save most earners a little bit but reserved it’s largest cuts for top earners. The theory being that tax cuts for the wealthy would “trickle down” to the masses by way of increased job creation. Here we are ten years (and one day) later, have you felt the trickle?
However you feel about the tax cuts, it’s very difficult to argue that they successfully supported economic growth. Throughout the decade, real wages have fallen; the gap between the rich and poor has increased; and job growth stagnated. Even during the “boom”. Let me rephrase that, as the economy was “growing” between 2001-2007, most Americans were regressing financially.
