Welcome (back) to the era of Voodoo Economics and trickle-down theory, which really in the end is Shrub's way of taking care of his rich friends and benefactors. Frankly, there just ain't enough lipstick to sufficiently pretty up this pig....
Here is Bush's case in brief. It begins with a little history. When he took office, he said, "we were in a recession," but "it looked like we were kind of starting to come out." Then came 9/11. After that came revelations that major corporations had "cooked the books." Although "we're overcoming" these setbacks, he noted, "too many of our people aren't working. We're growing, but we're not growing fast enough." And how does he account for the deficit? "We have got a deficit because this economy went into a recession," and "we have got a recession because we went to war. And I told the American people...we're going to spend whatever money is necessary to make sure we win." In other words: Don't blame me for a weak economy.
To solve the problem, Bush called for a plan based on this principle: "If your economy is too slow, you need to increase demand for goods and services." Increased demand leads to new jobs. And the most efficient way of creating new jobs is to "focus on small business" because "small-business owners" create the most jobs. Most small businesses don't pay corporate income tax. Instead, their profits are treated as income to their owners. So cutting ordinary income-tax rates is "really pumping capital into ... small business." The new tax bill also quadruples, to $100,000, the amount a small business can deduct each year for new equipment. Bush called this limit a "cap on investment."
How else do you help the little guy? You eliminate "the double taxation of dividends," said Bush, because that will boost the stock market, thereby "helping our average citizens realize wealth." (Ultimately, Bush had to settle for halving the top rate for the dividend tax.) All in all, he says, accusations that his plan "only helps the rich" are "just empty rhetoric."
Of course, everyone loves to have more money in their pockets. It figures that Shrub would be putting that money into the pockets of those who need it the least. This is not a tax cut; it's a redistribution of wealth to the already wealthy. Apparently, balanced budgets are useful only if you don't have rich friends to take care of.
