Much to the dismay of the Teabaggers, no doubt, Bruce Bartlett points out — again — that taxes are low in the United States.
Historically, the term “tax rate” has meant the average or effective tax rate — that is, taxes as a share of income. The broadest measure of the tax rate is total federal revenues divided by the gross domestic product.
By this measure, federal taxes are at their lowest level in more than 60 years. The Congressional Budget Office estimated that federal taxes would consume just 14.8 percent of G.D.P. this year. The last year in which revenues were lower was 1950, according to the Office of Management and Budget.
Yet if one listens to Republicans, one would think that taxes have never been higher, that an excessive tax burden is the most important constraint holding back economic growth and that a big tax cut is exactly what the economy needs to get growing again.
I would say they’ve mostly abandoned the “tax cuts will grow the economy again” argument and shifted to “taxing rich people goes against our belief system” one.
But the problem here is that the Democratic Party and the Obama administration haven’t consistently pointed out that cutting taxes on the wealthy and corporations hasn’t led to a strong economy. In short, as Krugman has put it, there’s been no rebuke of Reaganism.