A rising tide lifts all boats
President John F. Kennedy, arguing with fellow Democrats in Congress for a tax cut, memorably used the analogy, “a rising tide lifts all boats.” The subsequent tax cut worked like a charm.
The 2017 Republican tax reform has worked like a flood tide, lifting boats all across the economy. And the boats of women, minorities, and the middle class are rising faster than incomes as a whole.
With the Republican economy doing so well, Democrats have resorted to hackneyed complaints about income inequality. The rich are getting richer, they say, while the rest of us lag behind.
Sen. Elizabeth Warren launched her campaign with the claim that “America’s middle class is under attack.” Sen. Kamala Harris claims the Trump administration’s policies are harming women and minorities.
Are these claims true?
Republicans need only point to the wide variety of economic data that show women and minorities have been the biggest beneficiaries of the last two years. Take a look at a few facts from a recent Census Bureau report:
—Workers’ earnings increased 3.8 percent in 2018.
—The poverty rate declined to its lowest level since 2001 while the number of people on welfare rolls continues to drop.
—Full-time year-round workers in female-led households increased by 4.2 percent among blacks and 3.6 percent among Hispanics.
—Real median earnings for female households with no spouse present jumped 7.6 percent last year.
—Female household poverty rate declined 2.7 percentage points for blacks, 4 percentage points for Hispanics, and 7.1 percentage points for their children.
—Black women’s jobless rate fell to an all-time low of 4.4 percent and neared a low for Hispanic women at 4.2 percent.
—Unemployment for workers with less than a high school diploma dropped to 4.8 percent, the lowest level since it was first measured.
—Joblessness among Hispanic men declined to 3 percent, the best since it was first measured.
So how’s the middle class faring? The Census Bureau report belies Democratic claims as well:
—Real median household income rose to $65,084 for the 12 months ending in July of this year, a new record and a gain of $4,144 over the last two years. By comparison, during Obama’s 7.5 years starting from the end of the recession in June 2009, real median household income rose by only a total of about $1,000, no higher than it was when Bush arrived in 2001.
—Real median incomes in households headed by those between the ages of 15 to 24 increased by 9.1 percent and in households headed by those between ages 25 to 34 by 5 percent.
—Today’s middle class is spending more and saving more at the same time, and retail sales are booming.
—September’s unemployment rate dropped to 3.5 percent, the lowest in half a century.
—Utah’s unemployment dropped to 2.7 percent, and the state added 45,400 jobs in the last 12 months.
President John Adams is credited with saying, “Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passions, they cannot alter the state of facts and evidence.”
John Adams can rest assured that the facts above speak for themselves.
Income inequality actually increased during Obama’s eight years of tax increases, income redistribution, and hyper-regulation. It’s dropping in today’s era of Republican tax reform, deregulation, and economic expansion.
Democrats focus on income inequality because a statistic can always be found to show that some people are richer than others. What’s important are economic opportunity and income mobility, both of which the welfare state suppresses.
The last two years have shown that the best way to reduce income inequality is faster growth and job creation, which forces employers to compete for employees.
The viewpoints expressed above are those of the author and do not necessarily reflect those of The Independent.
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Howard, it remains to be seen how the effects of the 2017 tax act will really impact individuals and our economy but readers may want to look at these sites for some info. The cuts certainly haven’t helped our federal deficit so far.
https://www.forbes.com/sites/howardgleckman/2018/08/29/why-the-2017-tax-cuts-are-an-election-year-bust/#2b0f88e2eb3c
https://theweek.com/speedreads/874486/federal-deficit-hits-984-billion-track-reach-1-trillion-next-year