Series: The Advocates
Episode: 511
Original Link: https://americanarchive.org/catalog/cpb-aacip-15-5q4rj48t7c
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Episode Summary:
This episode of The Advocates debated whether the federal government should reduce everyone’s income tax rates by 30% over the next three years—a proposal based on the Kemp-Roth bill then before Congress. Advocate William Rusher, with support from Congressman Jack Kemp and banker Wendell Gunn, argued strongly in favor of the tax cut, framing it as a remedy for chronic inflation, tax bracket creep, and sluggish economic growth. They contended that progressively higher tax rates were eroding workers’ incentives, stifling investment and production, and overfeeding a bureaucracy that had grown inefficient and detached from public priorities. By cutting rates across the board, the Kemp-Roth proposal aimed to spur economic growth, increase personal savings and investment, and create jobs. The advocates leaned on the example of the Kennedy tax cut in the early 1960s, and invoked the Laffer Curve to argue that lower rates could ultimately sustain or even increase government revenues if the private economy expanded sufficiently.
Opposing the measure, Stephen Schlossberg—backed by economist Robert Dunn and Congressman Richard Bolling—contended that Kemp-Roth was an irresponsible, even “snake oil” approach that would likely result in massive federal deficits, heightened inflation, and increased income inequality. They pointed out important differences between the economic context today and the Kennedy era, emphasizing current high inflation, persistent and “chronic” unemployment among minorities and the young, and an already substantial federal deficit. Critics doubted that the proposed tax cuts would “pay for themselves” through growth, and warned that the program’s true intent was to force future cuts in government services and social programs relied on by the most vulnerable. Instead, they called for more targeted, equitable tax reform and for fiscal responsibility in government spending.
The debate crystallized a now-familiar American dilemma: whether sweeping across-the-board tax reductions would deliver broadly shared prosperity, or merely a short-lived windfall for some and a threat to social stability and government solvency. It also illustrated sharply different philosophies about government’s role, the behavioral response of workers and investors to taxation, and the risks of attempting expansive fiscal policy amid high inflation and budget deficits. Viewers were invited to participate by voting on the proposal, highlighting the issue’s divisive but pressing relevance to American economic and political life.
