Despite all the hype, President Obama’s Monday Rose Garden speech on taxes did not contain any new policy proposals. Obama’s plan to raise taxes on all Americans making more than $250,000 a year is the exact same policy he had in his 2013 budget. But it is hardly the only tax hike Obama proposed. In total, the Obama budget contains $2 trillion in tax hikes over the next ten years.
But how does that compare to other tax hikes? Specifically, since Obama says he only wants to “go back to the income tax rates we were paying under Bill Clinton,” how does it compare to the 1993 tax hike?
Last summer the Treasury Department released an analysis on the Revenue Effects of Major Tax Bills since 1940. It shows that the Clinton tax hike increased government revenues by .63 percent of gdp over the first four years of implementation.
Obama’s budget has not been implemented yet, but we can compare current tax policy (the March 2012 alternative CBO baseline), with the CBO’s estimated revenue impacts of the tax hikes in Obama’s budget. The resulting chart, with gdp and unemployment data from the Commerce and Labor Departments added, is below: