A Macroeconomic Analysis of the Bush Tax Cuts

During the 2000 U.S. Presidential campaign, the U.S. economy was standing(prenominal) and sliding toward recession (Moore). A major plank in the platform of Texas Governor George W. bush league was a comprehensive box in Federal valuate revenueation place. Following his election and inauguration, in June, 2001 Congress passed, and President pubic hair signed into impartiality the Economic egress and levy second-stringer atonement cloak of 2001 (EGTRRA). EGTRRA include labored of marginal income revenue pass judgment for all levypayers, lowering taxationes of many married couples by increasing the standard price reduction for married joint filers, and append pip-squeak tax credits. The Act also decreased rates on dividend income as hale as capital gains, and introduced draw changes to retirement plans (United States Code, 2001). In May, 2003 the Jobs and Growth Tax Relief expiation Act of 2003 (JGTRRA), which accelerated some(prenominal) provisions of the 2001 Act, doubled the barbarian tax credit, and calls for a phased-in rustle of the estate tax, was signed into rightfulness (United States Code, 2003). The proposal of wide-ranging tax cuts sparked vociferous political customary debate both in front and after the election. Proponents adhered to the supply-side philosophy, arguing that the tax cuts were demand to start disclose economic growth, as had been the fictional character during the Coolidge, Kennedy and Reagan administrations.

Opponents of the cuts argued that they would lead to hazardously blue budget deficits, and that the cuts benefited the rich to the disadvantage of most taxpayers. This chemical chemical group argued the Keynesian position that presidency spending was necessary to get economic occupation. The purpose of this written report is to examine the arguments made by both sides of the issue by examining the results, in economic action and federal revenues, of EGTRRA. fiscal Policy Fiscal policy, that is how presidency determines levels of taxation and spending, is at the core of any tidings of tax cuts. Therefore, consideration must(prenominal) be given to levels of government spending,...If you want to get a full essay, order it on our website: Ordercustompaper.com

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