For those who believed it was a fluke when just before the election Ben Stein went on Fox News and said there was little correlation between taxes and economic activity, it was not.
Ben Stein struck again on Fox News when sitting on a panel he simply tore through Charlie Gasparino with facts.
Ben Stein (being constantly interrputed): Charlie with all due respect there is no data, no reputable study showing that raising taxes on rich people inhibits growth
Charlie Gasparino: Nineteen eighties, Nineteen eighties, cutting capital gains
Ben Stein: Sir from 82 to 88 every year Mr. Reagan raised taxes
Watch the clip:
Republicans have been trying for a long time to suppress all the reputable studies that show raising taxes on the wealthy do not adversely affect the economy. In fact, because the marginal propensity to consume of the middle class is greater proportionally than the rich, and because marginal tax increases does not inhibit any marginal spending increase by the rich, it can actually improve the economy.
If that tax increase is returned mostly to the economy and partially for debt relief, there is a large multiplicative effect to the economy. This was borne out under both President Reagan and President Clinton.
Of course, Reagan's huge budget deficits were very stimulative, and as a result most of his economy was based on stimulus and not on inherent real increases in permanent investments in America as a whole.