February 6, 2010 - Happy Birthday Ronald Reagan!
Click here for a larger image: http://twitpic.com/11txqk
Today would be President Ronald Reagan's 99th birthday. In honor of this occasion, we post a reading list about Reaganomics with the hope that Democrat leaders in state government will discover tax cuts as an avenue to spur economic growth in Maryland and lead the state out of the recession.
Unfortunately, Maryland has pursued the opposite course. As the state was entering a severe economic recession, General Assembly Democrats allowed Governor Martin O'Malley to foist the most historic, massive tax increase on our citizens.
Businesses already hammered by the recession were crushed by O'Malley's anti-business pursuit of higher sales taxes, personal income taxes, corporate taxes and motor vehicle excise taxes. At the same time, O'Malley was adopting more stringent regulations that have added to the cost of doing business in Maryland.
In three short years, Maryland's ranking as a state favorable for economic development has plummeted from 24th to 45th.
This was the biggest one-year drop ever in the history of the rankings and was based upon the tax hikes initiated by O'Malley: "Maryland's drop from 24th to 45th out of 50 states on the Index is attributable to an increase in most of the state's major taxes for FY 2009.
They raised the corporate income tax rate to 8.25% from 7%, the sales tax rate to 6% from 5%, and the
cigarette excise tax to $2.00 from $1.00 per pack. Maryland also created four new income tax brackets, raising taxes on filers earning more than $150,000 per year. The state's top personal income tax rate is now 6.25% (up from 4.75%); that's on top of a weighted average local option rate of 2.98%. Maryland now has by far the worst personal income tax in the country, with a significantly lower score than second-place California."
With these kinds of rankings, it is obvious that Maryland needs a turn-around artist with the talents of President Reagan. In a 1996 study titled "Supply-Side Tax Cuts and the Truth About the Reagan Economic Record" by William A. Niskanen and Stephen Moore, the Reagan economic plan is described as having four key points:
"In 1981 Ronald Reagan entered the White House and immediately implemented a dramatic new economic policy agenda for the country that was dubbed "Reaganomics." Reaganomics consisted of four key elements to reverse the high-inflation, slow-growth economic record of the 1970s: (1) a restrictive monetary policy designed to stabilize the value of the dollar and end runaway inflation; (2) a 25 percent across-the-board tax cut enacted (The Economic Recovery Tax Act of 1981) designed to spur savings, investment, work, and economic efficiency; (3) a promise to balance the budget through domestic spending restraint; and (4) an agenda to roll back government regulation."
According to an economic analysis by the Joint Economic Committee of the House of Representatives: "The Reagan tax cuts, like similar measures enacted in the 1920s and 1960s, showed that reducing excessive tax rates stimulates growth, reduces tax avoidance, and can increase the amount and share of tax payments generated by the rich. High top tax rates can induce counterproductive behavior and suppress revenues, factors that are usually missed or understated in government static revenue analysis. Furthermore, the key assumption of static revenue analysis that economic growth is not affected by tax changes is disproved by the experience of previous tax reduction programs."
An economic program for Maryland's future must include a rollback of taxes and government regulations combined with true restraint on government spending in the FY11 budget.
For more on President Ronald Reagan and his successful economic policies, check out the links on our website at www.mdsenategop.com.
Pres 1981 40 Reagan-RonaldClick here for a larger image: http://twitpic.com/11txqk
Today would be President Ronald Reagan's 99th birthday. In honor of this occasion, we post a reading list about Reaganomics with the hope that Democrat leaders in state government will discover tax cuts as an avenue to spur economic growth in Maryland and lead the state out of the recession.
Unfortunately, Maryland has pursued the opposite course. As the state was entering a severe economic recession, General Assembly Democrats allowed Governor Martin O'Malley to foist the most historic, massive tax increase on our citizens.
Businesses already hammered by the recession were crushed by O'Malley's anti-business pursuit of higher sales taxes, personal income taxes, corporate taxes and motor vehicle excise taxes. At the same time, O'Malley was adopting more stringent regulations that have added to the cost of doing business in Maryland.
In three short years, Maryland's ranking as a state favorable for economic development has plummeted from 24th to 45th.
This was the biggest one-year drop ever in the history of the rankings and was based upon the tax hikes initiated by O'Malley: "Maryland's drop from 24th to 45th out of 50 states on the Index is attributable to an increase in most of the state's major taxes for FY 2009.
They raised the corporate income tax rate to 8.25% from 7%, the sales tax rate to 6% from 5%, and the
cigarette excise tax to $2.00 from $1.00 per pack. Maryland also created four new income tax brackets, raising taxes on filers earning more than $150,000 per year. The state's top personal income tax rate is now 6.25% (up from 4.75%); that's on top of a weighted average local option rate of 2.98%. Maryland now has by far the worst personal income tax in the country, with a significantly lower score than second-place California."
With these kinds of rankings, it is obvious that Maryland needs a turn-around artist with the talents of President Reagan. In a 1996 study titled "Supply-Side Tax Cuts and the Truth About the Reagan Economic Record" by William A. Niskanen and Stephen Moore, the Reagan economic plan is described as having four key points:
"In 1981 Ronald Reagan entered the White House and immediately implemented a dramatic new economic policy agenda for the country that was dubbed "Reaganomics." Reaganomics consisted of four key elements to reverse the high-inflation, slow-growth economic record of the 1970s: (1) a restrictive monetary policy designed to stabilize the value of the dollar and end runaway inflation; (2) a 25 percent across-the-board tax cut enacted (The Economic Recovery Tax Act of 1981) designed to spur savings, investment, work, and economic efficiency; (3) a promise to balance the budget through domestic spending restraint; and (4) an agenda to roll back government regulation."
According to an economic analysis by the Joint Economic Committee of the House of Representatives: "The Reagan tax cuts, like similar measures enacted in the 1920s and 1960s, showed that reducing excessive tax rates stimulates growth, reduces tax avoidance, and can increase the amount and share of tax payments generated by the rich. High top tax rates can induce counterproductive behavior and suppress revenues, factors that are usually missed or understated in government static revenue analysis. Furthermore, the key assumption of static revenue analysis that economic growth is not affected by tax changes is disproved by the experience of previous tax reduction programs."
An economic program for Maryland's future must include a rollback of taxes and government regulations combined with true restraint on government spending in the FY11 budget.
For more on President Ronald Reagan and his successful economic policies, check out the links on our website at www.mdsenategop.com.
*****
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