Julian Bond: “The tax increases in 1993 had the effect of costing jobs and economic growth in this country. Two economists, William…”

“The tax increases in 1993 had the effect of costing jobs and economic growth in this country. Two economists, William Beach and Scott Hodge, at the Heritage Foundation, used the very reputable econometric model, the Washington University macro model, to try to figure out what happened as a result of that 1993 budget deal. They calculated it reduced private sector jobs by 1.2 million. We lost $208 billion in output, or the equivalent of $2,100 per family. What is worse, they found out the tax increases did not reduce the deficit as much as predicted because tax increases change behavior and not all the taxes were generated. Only about 56 cents of additional deficit reduction came for every $1 of new taxes. So that did not work very well.”