# Bush tax plan will put money in S.C. economy

**By JIM DEMINT**

President Bush\'s jobs and growth package will create thousands of new
jobs in South Carolina for one simple reason: Money at home empowers
people; money in Washington empowers politicians.

The president\'s jobs plan will create new jobs and put more people back
to work because our economic engine turns when Americans control how
their income is spent. Under the president\'s plan, a married couple
with two children earning \$40,000 will see their tax bill reduced by
more than \$1,000.

Millions of other Americans will benefit from accelerated tax rate
reductions, an increase in the child tax credit, a reduction in the
marriage penalty and a tax cut on both dividend income and capital
gains, providing relief for the 50 percent of Americans who are invested
in the stock market, as well as the 70 million Americans who own their
homes. Americans will also have to work fewer hours to earn the same
amount of take home pay, giving parents more time to spend with each
other and their children.

By keeping more dollars at home and out of the greedy hands in
Washington, more jobs will be created in our communities. The Heritage
Foundation estimates that the president\'s jobs plan will create at
least 25,000 new jobs in South Carolina over the next five years.

Still, some in Washington argue that we can\'t afford the \"cost\" of a
tax cut when we are facing budget deficits and a costly war on terror.
However, this argument is deeply flawed.

First, tax cuts don\'t cause deficits; spending does. Also, the federal
government does not have a divine right to your income, so depriving the
government of your income is not a \"cost\" to Washington.

Second, tax cuts reduce deficits because they generate more, not less,
revenue for the federal government. This process might sound
paradoxical, but it works. As a former businessman and current member of
Congress, I know that a dollar in the pocket of an individual in South
Carolina will do more to stimulate our economy than a dollar in the
pocket of a politician in Washington.

Dollars spent by private citizens ripple through our economy, building
wealth along the way. When someone buys a new car, for example, the
profits help pay the salary of the salesperson, store manager and car
maker, all of whom then spend part of their earnings on other goods and
services, amplifying the ripple effect. A dollar spent in Washington, on
the other hand, often falls into a black hole, doing nothing more than
strengthening the government\'s pull on our pocketbooks.

Besides President Bush, two modern presidents who understood that tax
cuts create jobs and more tax revenue were Presidents John F. Kennedy
and Ronald Reagan. In the seven years after Kennedy signed a 1961 tax
cut bill, the economy expanded by 42 percent and federal revenues jumped
33 percent. President Reagan signed a tax relief package in 1981, and
tax revenues doubled by 1990.

Finally, the best way to keep our economy strong so we can create jobs,
defend our homeland and fight the war on terror is through a combination
of tax cuts and spending cuts. It is ironic that many politicians who
are criticizing the \"cost\" of the president\'s tax cuts have offered
no plan to address the real costs of government \-- large, unsustainable
programs that are, in many cases, inefficient and obsolete.

The reason Washington seems to spend like \"drunken sailors,\" as one
member of our delegation recently stated on this page, is because our
ship of state never leaves port without a well-stocked bar. Whenever
Congress embarks on a new session, it is overflowing with an elixir most
politicians can\'t resist \-- your tax dollars. Again, money at home
empowers the people; money in Washington empowers \-- or inebriates \--
politicians.

Just as Congress has shifted the tax cut debate from \"if we should cut
taxes\" to \"how much should we cut taxes,\" we can do the same with the
spending side of the equation. Congress has reduced spending only three
times since the 1930s \-- during World War II, the Korean War and in
1995, the first year after the Republican takeover of Congress.

Those concerned about the \"costs\" of tax cuts on the treasury could
also support a plan drafted by Rep. Kevin Brady, R-Texas, and Sen. Sam
Brownback R-Kan., to create a commission to review and close obsolete
and duplicative federal agencies. Another way to control costs is to
rally behind House Majority Leader Tom DeLay\'s recent call to cut all
federal spending by 1 percent next year.

Creating jobs and keeping our economy strong for the challenges before
us as a nation will require courageous leadership and sound solutions.
President Bush\'s plan to let Americans keep more of what they earn is a
significant step in the right direction.

\_\_\_\_\_

*Rep. DeMint represents South Carolina\'s 4th District in the U.S.
House.*