Income Tax by stevepb is licensed under CC0 via Wikimedia Commons.
In a new essay today, President Trump ally Newt Gingrich wrote:
Republicans passed a blueprint for President Donald Trump’s “big, beautiful bill,” but the challenge is far from over.
Speaker Mike Johnson and other Republicans must remain vigilant against any effort by misguided members to raise tax rates in the final bill. This is historically important and could have huge political consequences.
The truth is, there has always been a pro-tax increase faction within the GOP. The same night President Ronald Reagan’s three-year tax cut passed the House of Representatives two of his top aides met to discuss how to claw back some of the money that would be returned to the American people. Their ideology told them it was the government’s money. To Reagan, it was the American people’s money.
President Reagan represented a revolution in Republican thinking about taxes. He was convinced by Congressman Jack Kemp, Art Laffer, Jude Wanniski, Larry Kudlow, and other supply side economics advocates that lower taxes and reduced regulation would lead to a private sector boom and create an enormous number of jobs.
At the time, most Republicans were fiscal hawks narrowly worried about deficits and cutting spending. Then-Republican Senate Majority Leader Howard Baker called the three-year tax cuts “a river boat gamble.”
Despite the overwhelming success of Reagan’s strategy, the pre-Reagan wing remained willing to raise taxes. In 1988, then-Vice President George H.W. Bush pledged “read my lips, no new taxes” at the Republican National Convention (which earned huge applause). Yet, in 1990, President Bush allowed his senior staff and the Democrats to talk him into breaking his word. Bush’s tax increase was a catastrophic decision. It weakened the economy, split the Republican Party, and directly led to Bush’s defeat in 1992.
