DOES MAGANOMICS = SUPPLY-SIDE TRICKLE DOWN VOODOO ECONOMICS FOR THE RICH?
NOT AT ALL!
AND HERE'S PROOF:
Voodoo, trickle down, supply-siders presidents Harding and Coolidge slashed top marginal tax rates on millionaires and billionaires (like the Rockefellers) from 70% to 25%. This was the biggest, deepest tax cut for the super-rich in US history. The impact, however, was a booming, supercharged, pro-business, highly innovative, productive economy that was a large factor in ending the post-war depression of the late Wilson years (see), and unleashed the Roaring, Soaring Prospering Twenties where unemployment fell to 1.5% (unmatched until World War II). In the 1924 election a grateful, thriving expanding middle class returned Coolidge to power in a landslide 35 state victory with 54% of the popular vote (see).
Voodoo, trickle down Kennedynomics reduced top marginal tax rates on millionaires and billionaires (including Kennedy, his family and criminal dad) from 91% to 70% see. The result was a booming economy "lifting all boats" that doubled GDP to 5% from the sluggish growth of the Eisenhower years verging toward a sixth post-war recession in the 60s. And a grateful, prospering middle class wanting the good times of rising wages and wealth to continue returned LBJ (Kennedy's successor) to power in a 44 state sweep with 61% of the popular vote (see).
Voodoo, trickle down Reaganomics nearly matched the historic tax cuts of the 1920s (Reagan loved Calvin Coolidge) slashing top marginal tax rates on the richest Americans in two stages from 70% to 50% in 1981 (see), then from 50% to 28% in 1986 (see). And once again growth, productivity and good paying new jobs soared ending the terrible stagflationary recession of the early 80s; and in 1984 a grateful, prospering middle class seeing America becoming great again after the malaise of the Carter years returned Reagan to power in a staggering 49 state sweep with 59% of the popular vote (see).
In 1988 George Bush (he coined the term "voodoo economics") was given a landslide victory by a prospering middle class to continue Ronald Reagan's supply-side policies-which he pledged to do. But in 1990 Bush (to his political misfortune) breaking his pledge of "no new taxes" increased top marginal rates on the rich from 28%-31%. Now as tax hikes (as Obama adviser Christina Romer proves see), have a contractionary effect on economic growth Bush's new taxes (however slight) slowed down the recovery from the 1990 recession (caused by the Gulf War's impact on oil prices, see) and cost him the presidency in 1992 when Bill Clinton made the economy (Bush's anemic recovery) the central issue.
It is astonishing that in 2014 Bush accepted a Kennedy family Profile In Courage Award for his politically ruinous and economically damaging tax hike when supply-sider JFK would never have done such a thing.
In 1993 Bill Clinton raised top marginal tax rates from Bush's 31% to 39.6% (and increased corporate taxes to 35% see). This slowed down the recovery Clinton inherited from Bush and cost Democrats the House in 1994. Clinton understanding the damage he had done and fearing worse regretted raising taxes so high (see). But the Hi Tech-Internet-Dot Com Revolution (rooted in the business friendly Reagan 80s and the creation of Silicon Valley during his governorship of California see) swung into high gear invigorating the economy and hiding or overwhelming the growth inhibiting effects of Clinton's tax hikes.
Also adding to the rising growth of the 1990s was Clinton's reckless, insane Affordable Housing Program. This put millions of low-income folks into homes they couldn't afford turning them overnight into middle class Americans and setting the stage for the housing/credit crash of 2008 (see and see). When evaluating the booming economy of the Clinton era most analysts overlook this point.
George Bush announcing the end of the recession of the early 2000s
Two of the three supply side presidents mentioned above (Coolidge and Reagan) slashed taxes for all Americans to stimulate growth and end a depression and recession with the lion share of cuts going to the super rich (the most productive members of our society); and George W. Bush who inherited a recession from Bill Clinton (caused by the Dot-Com market crash and worsened by 9/11 see) would follow suit, but in a different way: he cut taxes on a temporary basis with an expiration date of 2010. And like with Coolidge and Reagan Bush's tax cuts worked their "voodoo" magic. Bush lowered taxes on everyone and gave the 1% rich the biggest break slashing Clinton's top marginal rate of 39.6% to 35%. The economy revived and by 2004 with the recession over Bush was reelected in a tight race with John Kerry (see) .
However, unfortunately for Bush, the sub prime loan driven affordable housing bubble he inherited from Clinton (and warned Congress about 17 times, see) thunderously burst in 2008; this had the effect of wiping out all of Bush's gains from the tax cuts and nearly plunging the economy into a depression. In all fairness to President Bush very little of the housing bubble was his doing. if Clinton like FDR had four terms the 08 crash would have happened all the same as it was unrelated to Bush's tax cuts, economic policies, growing debt and Iraq War.
In December 2010 when Bush's tax rates were due to expire Barack Obama (his massive stimulus program failing to ignite robust growth, and fearing another recession and one term presidency) extended for another two years Bush's rates keeping in place the top marginal 1%ers rate of 35% (see).
After his reelection Obama and the Republicans struck a deal to make permanent all of the Bush tax rates except for one: the top marginal rate of 35% for the rich; this was allowed to expire thus restoring Clinton's old rate of 39.6% (see).
However, the worst recovery since the Great Depression continued with the fortunes of the "disappearing" middle class slowly growing progressively worse. Whether the tax hike on the 1% rich played a part in this is debatable. But in 2015 mad as hell middle class voters headed by Bernie Sanders on the Left and Trump on the Right spontaneously rose up in revolt against the status quo wanting radical change.
And in 2016 the "forgotten" middle class voters of the rust belt states elected billionaire outsider Donald Trump president seeing in him the best hope for reversing their decade long decline.
On November 2, 2017 President Trump charting a middle course between the Steve Bannon populists (who want to raise taxes on the rich), and traditional supply-sides (who want to cut their taxes) proposed massive tax cuts for middle class families and the businesses they work for - while keeping Clinton's 39.6% rate for the top 1% millionaires and billionaires (who made out like bandits during the Obama years).
What this means is that MAGAnomics despite all the left-wing Trump derangement media propaganda isn't quite supply-side trickle down voodoo economics. As we've seen from presidents Coolidge, Kennedy, Reagan and Bush without cutting personal income taxes for the rich there is no, strictly speaking, supply side economics. The program of massively slashing taxes for middle class Americans and the businesses they work for without saving or costing the rich so much as a dime in personal taxes is something new, original and unseen before in American politics.
The question then is this: Will Trump's MAGAnomics tax cuts stimulate growth like top down, across the board supply-side cuts have done in the past? Probably not. It's unlikely that we'll see the booming economic growth of 4 and 5% we saw in the past. But grow the economy MAGAnomics will possibly doubling GDP from the sickly, pathetic, trickle growth of 1.48% of the anti-business Obama years with its growth stifling focus on spending and spreading (redistributing) wealth instead of creating it. But that should be enough to markedly improve the fortunes of middle class voters (give them a sense that their greatness and prosperity are being renewed); and this will give Donald Trump in 2020 an unthinkable, impossible, not going to happen reelection victory.