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What Would Ronald Reagan Do?

Floor Speech

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Date:
Location: Washington, DC

Mr. CONNOLLY of Virginia. Madam Speaker, this month, as American families and businesses anxiously await Congress' action on the expiration of any number of tax cuts, I thought it would be a good idea to ask ourselves again that question: What would Ronald Reagan do? Let's query the Gipper. After all, for the past 3 years all we've heard from Republicans is the claim that President Obama taxes too much.

When the Tea Party started its lobbying efforts in 2009, their name ``tea'' actually was an acronym standing for ``taxed enough already.'' So just like the Republican Party, the Tea Party expressed an apoplectic furor about what they thought was happening to taxes.

But while blind conjecture and pithy slogans are useful in getting attention, they ultimately fail unless they're backed by facts. Thankfully, the nonpartisan Congress Budget Office recently came out with its comparison of the average Federal tax rates paid by American families over the past 31 years. I'm sure Republicans and the Tea Party were all as surprised as many of us to learn that since 1979 Americans paid the lowest average Federal rate in 2009 under President Obama. That's right. Thanks in large part to the Recovery Act's $243 billion in middle class tax cuts--which my friends on the other side of the aisle opposed to a person--the average Federal tax rate fell to a 31-year low.

The average Federal rate since 1979 is 21 percent--meaning that, on average over the past 31 years, Americans paid 21 percent of their yearly income to the Federal Government each April. The previous low for the past 31 years was 18 percent. But in 2009, President Obama's first year in office, the average Federal tax rate actually fell to 17.4 percent, the lowest since 1979 when Jimmy Carter was in the White House. That means a lower percentage of taxes paid than under Bill Clinton, lower taxes than under both of the two George Bushes, and, yes, a lower average Federal tax rate than under the Gipper, Ronald Reagan.

Throughout President Reagan's 8 years in office, the average Federal tax rate was 20.9 percent, never dropping below 20.2. In contrast, in his first year, the average rate under President Obama was 17.4. In other words, after taking into account all the tax breaks and tax loopholes--especially the Recovery Act's Making Work Pay tax cut--Americans, in 2009, paid 2.8 percent less of their income to the Federal Government than they paid during Ronald Reagan's best year. Ronald Reagan, George Bush, Bill Clinton, the other George Bush, and President Obama. By far, President Obama has the lowest tax rates.

Perhaps if the average Federal tax rate under President Obama was as high as those during President Clinton's second term, then maybe Republicans would have a better argument. Of course, President Clinton's second term also saw significant job growth and expanding economy, and the only Federal budget surpluses since 1969--four in a row. But to complain about Federal deficits and then immediately call for cutting taxes on the highest income brackets--even lower than the current 31-year low under President Obama--shows significant hypocrisy or a lack of basic addition and subtraction skills.

So as today's Republicans try to spin a tax fairy tale, where the lowest Federal tax rate in 31 years under President Obama is somehow too high, while ignoring the higher rates through the eighties and nineties, perhaps it's time once again to ask: What would Ronald Reagan have done?

Republicans, even those who profess to idolize President Reagan, of course, won't ask because they don't want to hear the answer. Following the significant initial tax cuts in 1981, President Reagan subsequently signed into law a host of taxes to try to bring the budget back into balance. Five times he raised taxes in his 8 years.

Madam Speaker, as Congress debates the extension of the current tax burden, comprehensive tax reform, and overall budget deficits, I again feel compelled to ask my colleagues: What would Ronald Reagan do?


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