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Public Statements

Tax Cut Repercussions

Floor Speech

By:
Date:
Location: Washington, DC

BREAK IN TRANSCRIPT

Mr. GRAYSON. Mr. Speaker, here in the House and in the Senate and with the President's pen, we make policy for America. We make foreign policy. We make security policy. We make health policy and environmental policy. And we make economic policy. And it's time to take a close look at exactly what the tax cuts for the rich have done for us for the past 9 years because now we are going to make policy for not just the next 2 years, but I believe for far longer than that.

Let's simply take a look at the 9 lean years that we have experienced under tax cuts for the rich and compare them to the 9 fat years that preceded that. The first thing you'll know, which you can see from this chart here, is that in the 9 previous years before we enacted the Bush tax cuts for the rich, 23 million jobs were created. Since we enacted those tax cuts for the rich, we have lost 2 million jobs in America.

The next chart shows that the average unemployment rate as a result rose from 5.5 percent approximately to well over 6 percent after we enacted the Bush tax cuts. So often I have heard that the Bush tax cuts for the rich will somehow create jobs when the record is directly to the contrary. In fact, it doesn't only affect people who work, it affects everyone.

If you look at the net worth of this country, the net worth of America, the value of all of our schools, our homes, our 401(k)s, our small businesses, our cars, our furnishings, everything that we own in America, according to the Federal Reserve, in the 9 years before we enacted the Bush tax cuts, home values in America rose by 37 percent. In the 9 years after we enacted the Bush tax cuts, our home values in America rose only 13 percent. And as a result of that--because our homes are, for many of us, the most valuable thing that we own--as a result of that, our net worth as a country increased by 93 percent before we enacted the Bush tax cuts and by only 26 percent after we enacted the Bush tax cuts. Now I think that's a very important statistic. We are taking into account the rich and the poor, the black and the white, the male and the female, people all across the country. When we didn't have the Bush tax cuts, our net worth as a country increased by 93 percent. When we did, it increased only by 26 percent.

Now, there's been a lot of discussion lately about the deficit, the debt. If you look at what the effect was on the deficit and on the debt, you will find that in the 9 years before we enacted the Bush tax cuts, we had on average a 2.37 percent surplus in the Federal budget. In those 9 years, we actually had a surplus on the average of 2.3 percent of gross domestic product. And since the Bush tax cuts were enacted, we have had a deficit of 8.5 percent on the average each year.

We all know the dramatic effect that the decline in the economy has had on the poor and on the middle class. But let's take a short moment to look at what effect it actually had on the rich. Before we enacted the Bush tax cuts, the S&P 500 index--the most broad measure of stock market performance in the United States, 500 different companies--the S&P 500 increased in those 9 years by an amazing 285 percent. Now, since more than half of all stocks in America are owned by the top 1 percent, the most wealthy Americans,
that means that the most wealthy Americans benefited by not having the Bush tax cuts to the tune of a 285 percent increase in the stock market.

In contrast to that, since the Bush tax cuts were enacted, the stock market has actually gone down over the past 9 years by 11 percent. So I ask you whether you are working, whether you are not working, whether you are poor, whether you are middle class, whether you are rich, isn't it obvious what will happen if we extend these tax cuts any further? Whether it's for 1 year or for 2 years or for another 9 lean years. I think the answer is obvious. Fewer jobs, higher unemployment, a lower value to our homes, lower value to the Nation's net worth, and a drop in the stock market. That's the future that we face if we extend these pernicious tax cuts further.


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