Tax Hikes Hurt the Economy

NBER study shows Tax Increases Reduce GDP: "an exogenous tax increase of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent. ... The large effect stems in considerable part from a powerful negative effect of tax increases on investment. (Abstract of the Economics Study by Romer and Romer.) We need a reminder of this common-sense principle, proven by experience and economic study, in a week when the Democrats in Congress voted to increase taxes by 2012 by almost a trillion dollars. The Democrats have voted to send this country into a recession.