National Journal's Ron Brownstein challenged the assumption that the Bush tax cuts created much economic growth, noting that they failed to stem the rising number of Americans living in poverty. Brownstein made his liberal points Thursday morning on CNN to guest Rep. Paul Ryan (R-Wisc.).
"What in that record gives you confidence that extending those tax cuts will produce better economic growth in the future than they've contributed to so far in the past?" the CNN analyst posed to Ryan, citing that the number of Americans living in poverty increased by 8 million after President Bush enacted his tax cuts.
Brownstein's argument echoed the liberal blogs which tried to directly tie the Bush tax cuts to an increase in poverty. "There were fewer people working at the end of the eight years than when the tax cuts were passed," he insisted. His argument left out the effect the two recessions during Bush's presidency had on the number of Americans in poverty.
The recessions of 2001 and 2007-09 would have had an obvious impact on the job market and on the number of poor Americans and thus would have increased the number of Americans in poverty.
And while the number of poor Americans increased from 2001-2004, during which the first recession occurred, they leveled off and actually decreased slightly between 2004 and 2006. Then in 2007 – the year the second recession began – the numbers increased every year at a greater rate than before. In 2010, an estimated 46.2 million Americans were living in poverty.
Also, Brownstein overstated the increase in poverty under Bush's watch. The number of impoverished Americans grew by 7 million, not 8 million, over an eight-year span under President Bush, according to Census Bureau numbers. In less than half that time under President Obama, 6 million have been added to the poverty rolls.
The poverty rate also increased at a greater rate under President Obama than under Bush. The poverty rate stood at 11.7 percent in 2001 and never grew higher than 12.7 percent – a one percent increase – until 2008. The number climbed to 14.3 percent in 2009 and 15.1 percent in 2010 – during and immediately after the recent recession.
A brief transcript of the segment, which aired on February 9 during the 8 a.m. EST hour, is as follows:
RON BROWNSTEIN, CNN : Good morning, Congressman. Ron Brownstein from "National Journal."
Let me ask you, as you talk about your choice, the core choice on taxes that you offer is extending the tax cuts passed under President Bush. You mentioned the increase in poverty under President Obama – 8 million more people went into poverty in the first eight years after tax cuts were passed while Bush was in office. There were fewer people working at the end of the eight years than when the tax cuts were passed. What in that record gives you confidence that extending those tax cuts will produce better economic growth in the future than they've contributed to so far in the past?
Rep. PAUL RYAN (R-Wisc.): Well, fewer people were working now than before Barack Obama got started. We have a low employment rate, meaning not unemployment but employment. But what I would say is we're not saying extend tax cuts, we're saying reform the tax system to make us more competitive.
Look, here's the problem. Eight out of 10 of our businesses in America, they file their taxes as individuals. And so when the president keeps raising these tax rates, which are on individuals, they're actually on small businesses and we're taxing them at much higher rates than other countries.
Look overseas which in Wisconsin means Lake Superior, you know, Canada is lowering their tax rates on their businesses at 15 percent. And our top tax rate for small businesses is going to 45 percent in 2013?
You can't compete. You can't create jobs that way. Our businesses can't succeed in a global economy. And so, what we're saying is not just extend tax cuts, we're saying reform the tax code. Get rid of the loopholes. Get rid of the deductions. Lower the tax rates for everybody.
And when it comes to class warfare, look, what we're saying is, let's not penalize people who are successful, let's set the conditions for economic growth so new people can become successful that haven't seen success yet in their lives. Let's not preach envy and division, let's preach prosperity, and growth and hope.
And when you're taking away all those loopholes and deductions, it's the people in the higher income areas that enjoy them, anyway.