Can we learn from history?
I hope so.
Though, the correct answer appears to be, not if you are a Democrat.
Forty-five years ago this week, President John F. Kennedy announced a startling economic discovery. He tried to educate the American people about why he was cutting taxes – not that the American people or any other people have ever needed to be persuaded to cut taxes.
In a news conference Nov. 20, 1962, he said: “It is a paradoxical truth that tax rates are too high and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now. … Cutting taxes now is not to incur a budget deficit, but to achieve the more prosperous, expanding economy which can bring a budget surplus.”
Still, 20 years later, many were skeptical when Ronald Reagan explained the same principle again. Nevertheless, the policies worked both times – to perfection.
As for Kennedy, still an icon of the modern American Democratic Party, it was not the first nor the last time he would make this point.
In his budget message to the Congress Jan. 17, 1963, he explained: “Lower rates of taxation will stimulate economic activity and so raise the levels of personal and corporate income as to yield within a few years an increased – not a reduced – flow of revenues to the federal government.”
He underscored the point a few days later Jan. 21, 1963, in his annual address to the Congress: “In today’s economy, fiscal prudence and responsibility call for tax reduction even if it temporarily enlarges the federal deficit – why reducing taxes is the best way open to us to increase revenues.” He added: “It is no contradiction – the most important single thing we can do to stimulate investment in today’s economy is to raise consumption by major reduction of individual income tax rates.”
Three days later, in another message to the Congress on tax reduction and reform, he said: “Our tax system still siphons out of the private economy too large a share of personal and business purchasing power and reduces the incentive for risk, investment and effort – thereby aborting our recoveries and stifling our national growth rate.”
Just a couple months before he was assassinated in the streets of Dallas, he made a television address to the nation on his tax-reduction bill. He told his fellow Americans Sept. 18, 1963: “A tax cut means higher family income and higher business profits and a balanced federal budget. Every taxpayer and his family will have more money left over after taxes for a new car, a new home, new conveniences, education and investment. Every businessman can keep a higher percentage of his profits in his cash register or put it to work expanding or improving his business, and as the national income grows, the federal government will ultimately end up with more revenues.”
Throughout his young life, and particularly his short presidency, Kennedy made the point over and over again – high taxes were counterproductive, a drag on the economy, hurting the very people they would supposedly help through government programs.
In spite of Kennedy’s leadership on this issue – and despite the historic evidence we have to show his policies worked – those who continue to idolize him today, members of his party, even members of his family, don’t seem to get it. Or, if they do, they ignore the evidence for their own selfish reasons.
But you can’t change history. You can ignore it at your own peril. You can attempt to distort it for your own benefit. You can purposely hide uncomfortable facts. However, John F. Kennedy said these things and he followed through with actions. There is simply no denying this reality.
We had to learn the lesson in the ’60s. We had to learn it again in the ’80s. Are we willing to learn it again in the beginning of the 21st century? Do we dare forget it?
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