Bobby Jindal Just Killed Decades of Republican Trickle-Down Economics Tax Policy
I think the trickle-down economics policy by the GOP was a marketing gimmick, used long after they realized it didn’t work because basically, the average American, who has (let’s be honest) little understanding of macro-economics, could understand what sounded like a ‘scientific’ economics argument that lowering taxes on the rich means the amount the rich saved on taxes would be used to hire someone or be invested in Wall Street that would generate new businesses or just spent shopping which boosts the economy. It sounds logical and that is why Republicans used that line. But actual economics data over 30 years says otherwise. In reality, it was just a marketing gimmick no different than Herman Cain’s 999 slogan. I think the Great Recession allowed for these right wing myths that have been around since the Reagan era to die since we had low taxes, de-regulations and cowboy/gunboat diplomacy and increased military spending that led to the economic collapse.
Bobby Jindal Just Killed Decades of Republican Tax Policy
By Brendan Greeley on November 15, 2012
Do you hear that? No? Listen closer. There. That. That, coming from Louisiana, is the sound of the end of trickle-down economics. Economists have known for a while that personal marginal tax rates, and in particular those on the rich, don’t seem to have much of an effect on the economy. As we wrote in September, even Reagan’s economist did not find any evidence that the Reagan recovery had come from the Reagan administration’s personal income tax cuts. Over the last four years, apostate Republican thinkers such as Bruce Bartlett and David Frum began to agree. Then most of America did. Even a group of CEOs of major corporations came around to the idea that raising tax rates on the rich would not hamper growth.
In his remarks Monday Jindal didn’t come right out and say he supported increasing taxes on the rich. But it was still apostasy, especially coming from the new chairman of the Republican Governors Association. Imagine that in October a prominent Democrat had said, ‘We are not the party that simply protects the rich so they get to keep their toys.’ The only possible Republican response would be an accusation of class warfare. Yet Jindal, a two-term governor with a future, did just that. It’s unlikely that he’s had a come-to-Jesus moment on economics since I heard him speak a year ago. It’s far more likely that trickle-down economics, having failed with economists, has now been shown to have failed with the public. Protecting low taxes in general and job creators in particular is as much an electoral identity as it is an economic policy.
For three decades, Republicans have been the party of lower taxes, all the time, for everyone. This is simple, strong, and easy to understand. Barack Obama drew his clearest policy distinction with Mitt Romney on exactly these grounds: Obama would raise taxes on the rich. You can argue whether the president has a mandate at 52 percent, or what his mandate’s actually for, but it looks like Bobby Jindal has made a decision on his own. He’s calculating that trickle-down policies—policies that explicitly, unapologetically protect the rich—will never get a Republican elected president again.
This is a weaker position, rhetorically. ‘I’m for some low taxes for some people’ is harder to explain than ‘No new taxes.’ But it’s one of the uncomfortable subtleties that Republicans are going to have to learn how to say out loud. Jindal is effectively announcing his candidacy for president in 2016. He also just pulled the drain plug on the rising tide that lifts all boats.
Greeley is a staff writer for Bloomberg Businessweek.