In their discussion they start off by talking about immigration and segue into taxes. Martinez states how the tax rate will go up from 32% to 35% because the Bush tax cuts will expire soon. Wow. If you're being taxed at 32% you're making some serious cash. She throws around the "S" word but is not about to call Obama a socialist. Jay is more than happy to drop the socialist label for her. He goes on to say that the Bush tax cuts raised tax revenue by 44% ($743 million were raised during 2003 and 2007). Whoa! That's pretty good for a tax package that cost a trillion, almost two.
Jay brings up the GOP's go-to guy, Reagan. Apparently Ronald Reagan cut taxes and the economy grew. Wait, let me make a note of this: Reagan didn't raise taxes. Reagan didn't raise taxes! Let me say that one more time - Reagan didn't raise taxes.
You can listen to the audio of the conversation right now, and I'll include text of Martinez's recollection of the Great Depression below.
"They went through the Depression, they started to spend more money.....if we spend more money we will be able to revive the economy, and they didn't and it crashed again. It crashed in 29 and then again in 1932.
And they went through another series where they tried to (inaudible).....and it was during some part of FDR's administration with the New Deal and the New Deal 2; it didn't revive the economy at all."
"At some point, and even the GOP when they started to campaign and Hoover came on and said one of the issues was, 'have you had enough?'.... your average American asking the same thing. What revived the economy is they did 2 things: they cut taxes and they stopped spending. So they tightened the purse....."
Aha. Reagan and FDR both cut taxes. I hope I remember that. Let me make a mental note of another small detail: FDR started his presidency in 1933. OK, good. What I don't understand is why Hoover would say "have you had enough" when things crashed under his administration. If anybody should've said that it should've been FDR. He won mightily, by the way.
Let me clear up a couple of things, as I want to understand where Ms. Martinez is coming from. The New Deal and its spinoff didn't work. But things improved when taxes were cut. So the New Deal was scrapped for tax cuts? I guess what she wants us to believe is that FDR should be known for tax cuts and not New Deal spending.
I'm all confused now. Apparently the only one who spent money liberally was Hoover; and things didn't go so well, according to Martinez. However things prospered during Bush's and Reagan's terms in office.
I think what we're supposed to take away from this is that tax cuts are good and 35% tax rates are bad. The Bush tax cuts should be extended but not unemployment benefits. OK, I think I got it now.
It's a good thing we have two very knowledgeable people at the microphone to see us through these financially troubling times.