Patt Morrison

<em>Patt Morrison</em> is known for its innovative discussions of local politics and culture, as well as its presentation of the effects of national and world news on Southern California. Hosted by

Are tax increases job killers? The complicated answer to a loaded question

by Patt Morrison

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Sen. Mitch McConnell (R-KY) speaks during a press conference by Republican senators on a balanced budget amendment at the U.S. Capitol June 29, 2011 in Washington, DC. Win McNamee/Getty Images

The conventional wisdom is as old as economic theory: raise taxes during a recession or a down economy and you kill the recovery and job creation; lower taxes and jobs are created. The reality on the correlation between tax increases and job creation is much more complicated, as the debate is back on in Washington D.C. between President Obama, who wants to raise taxes on the wealthiest Americans to help close the budget deficit, and Congressional Republicans who want to keep current tax rates in place and slash spending instead. In the five years after a $241 billion tax increase under President Bill Clinton in 1993 the U.S. economy went on to create more than 15 million jobs and great at an average annual rate of 3.8%. In the five years after President George W. Bush reduced marginal tax rates in 2001 the economy created 6.5 million jobs and great at an annual 2.7% pace.


Alan Auerbach, director of the Burch Center for Tax Policy & Public Finance at University of California, Berkeley; former deputy chief of staff of the U.S. Joint Committee on TaxationForce

Pamela Olson, director of the Tax Group at the Washington D.C. law firm Skadden, Arps, Slate, Meagher & Flom; former assistant secretary for tax policy at the U.S. Department of the Treasury in the George W. Bush administration

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