On December 14, 1962, President Kennedy delivered an address to the Economic Club of New York. He made a strong case for personal and corporate tax rate reduction.
“The speech painfully reminds all Americans of how much the Democrat party has changed since President John F. Kennedy,” said Grover Norquist, president of Americans for Tax Reform. “JFK respected working Americans and fought to reduce taxes on all Americans. JFK rejected the politics of envy and class hatred. How the Democrat party has changed. For the worse.”
Excerpts of Kennedy’s speech are below:
“The final and best means of strengthening demand among consumers and business is to reduce the burden on private income and the deterrents to private initiative which are imposed by our present tax system — and this administration pledged itself last summer to an across-the-board, top-to-bottom cut in personal and corporate income taxes to be enacted and become effective in 1963.”
“I am talking about the accumulated evidence of the last five years that our present tax system, developed as it was, in good part, during World War II to restrain growth, exerts too heavy a drag on growth in peace time; that it siphons out of the private economy too large a share of personal and business purchasing power; that it reduces the financial incenitives [sic] for personal effort, investment, and risk-taking. In short, to increase demand and lift the economy, the federal government’s most useful role is not to rush into a program of excessive increases in public expenditures, but to expand the incentives and opportunities for private expenditures.”
“Corporate tax rates must also be cut to increase incentives and the availability of investment capital.”
“For all these reasons, next year’s tax bill should reduce personal as well as corporate income taxes: for those in the lower brackets, who are certain to spend their additional take-home pay, and for those in the middle and upper brackets, who can thereby be encouraged to undertake additional efforts and enabled to invest more capital.”
“It is increasingly clear that no matter what party is in power, so long as our national security needs keep rising, an economy hampered by restrictive tax rates will never produce enough revenues to balance our budget — just as it will never produce enough jobs or enough profits.”
“In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now.”