When I recently Googled “tax cuts for the rich,” my
browser returned 289,000 hits. It’s a phrase used often
by Democrats to impugn George W. Bush’s 2001 and 2003
tax cuts, portions of which are set to expire over the
next five years if Congress doesn’t get its act together
and pass the necessary legislation to extend them.
Earlier this month, the
Heritage Foundation published a web memo, “Make the Bush
Tax Cuts Permanent,” written by William W. Beach and Rea
S. Hederman. The writers warn, “If the [Bush] tax
cuts…are allowed to expire, millions of working families
will see their economic prospects dim, their job
opportunities diminish, and economic uncertainty rise.”
If such an economic
prognosis seems extreme, realize that job growth in
America over the last three years has been largely the
result of Bush’s economic program. To undo its
foundation—the tax cuts that provided the economic
stimulus—would have the potential to reverse those gains
the economy has made.
I run a small business
that employs eight full-time people and a consultant.
This year marks the 20th year of operations.
We represent a number of Chinese pharmaceutical
manufacturers. The raw materials we import are sold to a
range of customers; from medium-sized drug manufacturers
to large multi-national conglomerates listed on the
Fortune 500 whose names you would recognize.
In late 1986, I started
this company for a German business owner—a rich German
business owner—who wanted to extend his reach into the
US market. He already had operations in Hamburg, Germany
and Hong Kong. At that time, we had no customers; only a
list of products, some working capital and a lot of
heady ideas.
The result of this one
rich man’s risk-taking venture is exemplary of how
important “the rich” are to the US economy.
Over the last 20 years,
I have watched our sales grow by more than ten fold.
We’ve had employees come and go but no one has ever been
fired and only twice has someone left the company for
what they felt was a better opportunity. The “core
people” that started with me are still here.
While we have been busy
selling low-cost generic pharmaceuticals that save the
US consumer money, our business has generated hundreds
of millions of dollars in revenues. That money has gone
in a lot of different directions.
In addition to
salaries; which have allowed our employees to purchase
homes and automobiles, raise families, pay for their
children’s education and take nice vacations, health
care has been provided including dental, eye glass and
prescription drug coverage at the company’s expense. A
company-funded retirement plan was converted to a 401-K
several years ago with the company matching employee
contributions. Generous Christmas and year-end bonuses
along with a liberal number of paid personal days and
vacation days are part of our package.
The success of our
business has allowed it to purchase equipment; including
copiers, desks, chairs, a phone system and a network of
computers, upgraded twice in the last ten years.
Approximately two dozen company vehicles have been
provided to our sales force.
And we have paid our
fair share—millions of dollars—to the State of New
Jersey and the US Treasury Department in the form of
taxes, fees and import duties.
All of this represents
economic stimuli. It is a ripple effect, occurring as a
result of one rich man’s willingness to take risk, and
invest in America.
When this effect is
multiplied throughout the US economy it becomes apparent
how wrong Democrats are when they bash “the rich,” and
how correct the writers from the Heritage Foundation are
when they forecast that a repeal of the president’s tax
cuts would undermine the economy.
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