Would you care to back up your claim with facts and evidence???
Also, your comment about a 'strong tax base' is completely upside down. You don't have a strong tax base due to steeply progressive tax rates. You have a strong tax base due to have a fair tax system that encourages growth and business.
California has one of the most progressive tax systems in the country and it is on the verge of going bankrupt. Meanwhile Texas is a low tax states that has a balanced budget.
Finally, it is an undeniable truth that tax cuts create economic activity. Kennedy, Reagan, Clinton and Bush all passed major tax cuts during their terms and all saw strong economic expansions after those tax cuts were passed.
The only real question about tax cuts is whether they pay for themselves which is debatable and tends to vary depending on the tax cut.
You want evidence? Let's review.
First - I'm betting we have opposing views on what a 'strong economy' is. I am not a believer in GDP, markets, or other volume or high-end indicators. For me the economy is one thing: the health of the lower and middle class. If the bulk of nation can pay for a place to live, education, food, clothing, etc then the economy is good. When they can't, the economy is bad. The bulk of the nation (75%) makes less than $50,000/yr and 2/3 of those make less than $25,000/yr. That means that to me the economy is entirely dictated by how well a person who makes about $25,000/yr lives. Now, in times past those numbers were very different...they were shifted more towards the middle than the low end. But still, the bulk of the nation has been in the low middle or lower end of the earning spectrum.
So I have to look at the history of those people from say, 1920 on. Before that we were still too agrarian to compare the economies, and there weren't good enough records to get a solid picture anyway.
So let's see when the periods of high unemployment, high cost of living, low purchasing power were.
Of course we had the Great Depression (29-39 roughly). This immediately followed a period of sharp tax decline (from 70-20% at the top end). Pulling us out saw upper tax rates returned to 80% (and if you're a war savior mindset then it was 90% during that period). Now, it's important to note that it wasn't just taxes, but overall business/industry/corporate regulation as well. The period leading up to the great depression was all deregulation (or often just no regulation yet in place). The period of the recovery was strict regulation. It's also important to note that the severe tax rate (individual and corporate) kept the debt/deficit reasonably in check during the INTENSE spending the government did to help pull us out.
I tend to overlook the '48-54 mild recessions because there are so many other factors (shifting from war economy to peace economy, so many dead, changes in immigration, sudden change in household incomes, etc). However, if you want them considered you will find tax cuts and deregulation from about '42 (for war industries), and from '45 (for individuals and other industries). Tax rates raised again in '52, along with some new oversight, and the recession ended.
Then we get to the early '70s and all those issues. The '60s saw a 20% individual tax reduction at the high end. The late '60s were also the beginning of major deregulation, especially in the financial sector, advertising/marketing, pharmaceuticals, etc. There were other issues creeping up about this time, mostly international, so it again is murky to nail down specifics.
The mild recession in '80/'81 followed another 20% tax drop. The mild recession in '90/'91 followed another 20% tax drop. We're also looking at the most abusive deregulation in our history from 1980 to 1988 (thanks Raygun). Our current situation follows another 8 year session of tax breaks and deregulation. That's three recessions in three decades despite some of the largest booms in our history. All of which followed periods of tax breaks and deregulation.
If you look at the overall picture something very interesting develops. Not only do tax breaks and deregulation specifically lead to recessions, but the frequency of the 'bad times' is inversely proportional to the overall amount of regulation. When corporations and industry were on a tight leash with only infrequent loophole legislation or allowances we seldom saw a recession. When deregulation became the norm, we plunge every few years.
This also accompanies the periods of highest debt/deficit growth. When we were offsetting war costs with increased taxes, it wasn't a major hit. When we tied war costs to tax breaks, everything went to hell. When we tied tax hikes to government spending on economy stabilization, everything recovered nicely. When the government spends without tax hikes, everything stays in the crapper.
Finally, getting back to my own outlook, the purchasing power of the lower to middle class individual declines directly in proportion to the level of regulation. The less regulation on corporation/industry, the lower the upper tax rate, the less necessities can be afforded by these people that make up 75% of our nation. Compare housing prices, food prices, gas prices, health care costs, etc against the backdrop graphs on deregulation and upper tax rate. They're perfectly inverted. Mind you, luxury/entertainment is not included because it actually operates on the opposite trends for the most part.
America is strong and stable when we have a progressive tax rate with few breaks/loopholes, combined with strict regulation on corporations and industry. America goes to crap whenever we give those sectors a break, or stop watching them like hawks.
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