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Originally Posted by Supply Sider
And please keep in mind, I am not commenting on his spending, just his tax plan. Lets keep on topic.
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The two of them go hand in hand. The only purpose of taxing is to get some money for the government to spend. Talking about a tax plan without discussing spending is like teaching somebody how to get a car moving but not how to get it to stop where you want it to.
And it turns out that with the smaller budget and all, the national debt shrank during the Clinton years and expanded greatly during the Bush years. This is not to say that I think Clinton was the Beloved Economic Leader. I think that in the early years, he benefited from the first President Bush's infamous tax increase and then later on basically managed not to screw it up. Having a hostile Congress may also have been a contributing factor.
But if you want to talk only about your narrow subject...
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Check out the revenue when you compare the Clinton years to the Bush years. It tells an interesting story. Revenue and and taxes collected per capita have GONE UP under Bush, even though he lowered tax rates and eliminated some altogether.
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Revenue also rose during the Clinton years compared to Bush #41 whose government collected more revenue than Reagan who collected more than Carter etc. This is true both in gross and in per capita terms. So you're right. The numbers do tell an interesting story—when you look at only a small segment of them out of context.
I also couldn't really see this increase in revenues when looking at the spreadsheet you linked to. You will note that Clinton was still in office in 2000, and Bush's tax cuts certainly didn't come into effect yet. Per capita tax collected in that year was $7,404. It was higher than that in 2001 but never again. From 2002 to 2004, tax per capita reached nearly $7,000 but never quite made it over. That happens to coincide with Bush's first tax cuts going into effect.
But of course, it could be that we had a good year during Clinton's last months in office. And indeed it's true that on average, tax collected per capita during the Bush years was higher than Clinton's. But let's look at this another way. Clinton's worst year in terms of tax revenue collected was his first, 1993, in which tax per capita was $4,505. That's $6,123 in 2005 dollars according to the CPI's inflation calculator (and before you ask, yes I checked. The IRS's numbers in that spreadsheet are not adjusted for inflation). We did indeed manage more taxes than that during the Bush years. Even after his tax cuts took effect in 2002 (and after which revenue fell, but we won't get into that), the IRS still collected $6,977 per capita or about $7,616 in modern dollars.
But this shouldn't really be surprising. The economy grows. Even after adjusting for inflation, people on average almost always have more money in real spending terms than they did the year before. Let's assume an average GDP growth of 3% which is really pretty conservative. The French would be happy with a number like that, but Americans are used to something closer to 5%. But anyway, if you take that $6,123 from 1993 and grow it by 3% compounded yearly until 2002, you get $7,756.
So we find that this marked increase in tax revenue during the Bush years can be entirely explained away by inflation and natural GDP growth that took place before Bush even entered office. The only thing the tax cuts did was lower revenue relative to national growth. If you think about it, that really makes sense.