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The New York Times reported on Thursday that Senate Republicans applied pressure to the nonpartisan Congressional Research Service (CRS) in September, successfully persuading it to withdraw a report finding that lowering marginal tax rates for the wealthiest Americans had no effect on economic growth or job creation.
"The pressure applied to the research service comes amid a broader Republican effort to raise questions about research and statistics that were once trusted as nonpartisan and apolitical," the Times reported. Democrats in Congress, however, have resurfaced the report and published it in full. It can be read below.
Republicans told the Times they had issues with the tone, wording and scope of the report, but they clearly objected most strongly to its findings, which undermine the governing fiscal philosophy of the party, that tax cuts for the wealthy will spur growth and benefit everybody.
GOP officials told The Times that the decision by the CRS came after a cooperative discussion, but Democrats have suggested that the move is part of a broader effort by Republicans to squelch legitimate research that runs counter to their economic principles.
The CRS report, by researcher Thomas Hungerford, concluded:
The results of the analysis suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie.
However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution. As measured by IRS data, the share of income accruing to the top 0.1% of U.S. families increased from 4.2% in 1945 to 12.3% by 2007 before falling to 9.2% due to the 2007-2009 recession. At the same time, the average tax rate paid by the top 0.1% fell from over 50% in 1945 to about 25% in 2009. Tax policy could have a relation to how the economic pie is sliced?lower top tax rates may be associated with greater income disparities.
The report is extensive, but the reasoning behind its conclusion is fairly straightforward. The richest Americans are the least likely to spend extra money they get as a result of a tax cut, and are more likely to save it or invest it offshore. Those on the lower end of the economic spectrum, meanwhile, are the most likely to spend transfer payments they receive from the government.:scared
A release by the Democratic Policy & Communications Center on Wednesday accused Republicans of attempting to bury the report because its "findings undermine a central tenet of Republican party orthodoxy on taxes." They included a copy of the original report.
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Willard is a liar.
"The pressure applied to the research service comes amid a broader Republican effort to raise questions about research and statistics that were once trusted as nonpartisan and apolitical," the Times reported. Democrats in Congress, however, have resurfaced the report and published it in full. It can be read below.
Republicans told the Times they had issues with the tone, wording and scope of the report, but they clearly objected most strongly to its findings, which undermine the governing fiscal philosophy of the party, that tax cuts for the wealthy will spur growth and benefit everybody.
GOP officials told The Times that the decision by the CRS came after a cooperative discussion, but Democrats have suggested that the move is part of a broader effort by Republicans to squelch legitimate research that runs counter to their economic principles.
The CRS report, by researcher Thomas Hungerford, concluded:
The results of the analysis suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie.
However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution. As measured by IRS data, the share of income accruing to the top 0.1% of U.S. families increased from 4.2% in 1945 to 12.3% by 2007 before falling to 9.2% due to the 2007-2009 recession. At the same time, the average tax rate paid by the top 0.1% fell from over 50% in 1945 to about 25% in 2009. Tax policy could have a relation to how the economic pie is sliced?lower top tax rates may be associated with greater income disparities.
The report is extensive, but the reasoning behind its conclusion is fairly straightforward. The richest Americans are the least likely to spend extra money they get as a result of a tax cut, and are more likely to save it or invest it offshore. Those on the lower end of the economic spectrum, meanwhile, are the most likely to spend transfer payments they receive from the government.:scared
A release by the Democratic Policy & Communications Center on Wednesday accused Republicans of attempting to bury the report because its "findings undermine a central tenet of Republican party orthodoxy on taxes." They included a copy of the original report.
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Willard is a liar.
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U.S. agency withdraws tax report challenging Republican ideas
By Kim Dixon | Reuters ? 3 hrs ago.. .
WASHINGTON (Reuters) - A U.S. government agency has withdrawn a report that challenged Republican ideas about taxes and economic growth - an action that drew fire from Democrats who accused it on Thursday of bowing to political pressure.
Republican lawmakers blasted the Congressional Research Service (CRS) report when it was issued in September and then went to the agency to complain. The report suggested that lower tax rates on the wealthy are not linked to economic growth, an item of faith among many conservatives.
The CRS, a non-partisan arm of the Library of Congress, withdrew the report in an unusual move late last month, the agency confirmed on Thursday.
Top Senate Republican Mitch McConnell and others in his party had protested the report's methods and called its tone partisan. A top official at CRS made the decision to pull back the report, according to a CRS employee who spoke on condition of anonymity.
"As we would with any CRS analysis we felt fell short of their standards, our staff shared a litany of concerns with CRS over the methodology, the analysis and the conclusions," said Antonia Ferrier, spokeswoman for Republican Senator Orrin Hatch, the top Republican on the Senate Finance Committee.
Representative Sandy Levin, the top Democrat on the tax-writing House of Representatives Ways and Means Committee, called for a probe of the circumstances that led to the withdrawal of the report, which was written by economist Thomas Hungerford.
"I was deeply disturbed to hear that Mr. Hungerford's report was taken down in response to political pressure from Congressional Republicans who had ideological objections to the report's factual findings and conclusion," Levin said in a letter to CRS.
News of the report's withdrawal was first published by the New York Times.
A spokeswoman for CRS would not confirm what led the agency to put the report, as she put it, on "non-distributable status."
CRS is one of the alphabet soup of government agencies that conduct research for members of Congress. CRS generates its own research topics as well.
These tax analyses have taken on more importance during a presidential campaign in which President Barack Obama and Republican challenger Mitt Romney have argued over their tax plans. The election is Tuesday.
Alan Viard, an economist at the conservative American Enterprise Institute think tank, said the report's methods were questionable and incomplete. He said CRS had strayed from its non-partisan mission, contrasting it with the Congressional Budget Office.
"The CBO does such a fantastic job and will draw conclusions no matter whose feathers get ruffled," Viard said. "Unfortunately CRS has not consistently lived up to the high standards set by CBO."
(Reporting by Kim Dixon; Editing by Howard Goller and Will Dunham)
