I'm generally an enthusiastic Obama supporter, but this makes me wonder. Obama has not shied away from saying that he wants to raise taxes on the super-rich to pay for programs for the poor and middle-class, but he misses the opportunity here to confront the media's (and the public's) equation that higher taxes = bad economy. The corollary, of course, is that lower taxes = good economy. This is supply-side calculus, and I would like to hear Democrats make more critiques against it. After all, Bill Clinton hiked taxes in the 1990s and we had a decade of high economic growth, balanced budgets, low inflation, and all the rest. George W. Bush has slashed taxes and we've seen rapid inflation, a widening of the gap between rich and poor, and recently what looks to be a crippling, long-term recession. Sure, the numbers for the Bush economy looked good for most of his time in office, but the traditional metrics missed many of the problems, which is why most people have long believed that their personal finances have not been so great, and the decoupling of upper-crust prosperity from blue-collar economic conditions doesn't much seem to penetrate the minds of well-off media mavens. This is more solipsistic than your typical Charlie Kaufmann film.
I do vaguely seem to recall Clinton I making some critiques of supply-siderism back in the day, certainly Bush I did, and though John McCain acts as though he's found religion in the supply-side camp he doesn't entirely convince because he uses the wrong terminology (silly John, tax cuts are free under supply-side dictates!). This issue cuts close to my heart because supply-side cuts tilted to the wealthy as an economic stimulus have no basis in actual economics--no academic economists, conservative or otherwise, actually believe that. For one thing, giving away huge amounts of money to the wealthy doesn't stimulate anything because the wealthy tend to save more proportionally than, say, poor folks, and they often tend to save in foreign banks instead of domestic ones. It's really just a form of bribery on the part of the GOP to try to get their wealthy supporters (and don't kid yourselves: the wealthy do strongly favor the GOP) a little windfall. In other words, it's just bribery in exchange for votes. It's junk economics. But the media buys into it full-bore, because they're so liberal, right?
Jon Chait's The Big Con is probably the best book to consult on the subject.
