The results of the experiment that began when Congress passed a series of tax-rate cuts in 2001 and 2003 are in. Supporters of those cuts said they would stimulate the economy. Opponents predicted ever-increasing budget deficits and national bankruptcy unless tax rates were increased, especially on the wealthy.
In fact, Treasury statistics show that tax revenues have soared and the budget deficit has been shrinking faster than even the optimists projected. Since the first tax cuts were passed, when I was in the Senate, the budget deficit has been cut in half.
Remarkably, this has happened despite the financial trauma of 9/11 and the cost of the War on Terror. The deficit, compared to the entire economy, is well below the average for the last 35 years and, at this rate, the budget will be in surplus by 2010.
Perhaps the most fascinating thing about this success story is where the increased revenues are coming from. Critics claimed that across-the-board tax cuts were some sort of gift to the rich but, on the contrary, the wealthy are paying a greater percentage of the national bill than ever before.
The richest 1% of Americans now pays 35% of all income taxes. The top 10% pay more taxes than the bottom 60%.
Hat tip to Instapundit.