Kudows for Kudlow!

I've often said the best thing to do is just to state the obvious.  Larry Kudlow does just that in his latest column

Sometimes you have to take out your political lenses and look at the actual statistics to get a true picture of the health of the American economy. Right now, those statistics are saying a modest cyclical rebound following a very deep downturn could actually be turning into a full-fledged, V-shaped, recovery boom between now and year-end. Conservatives shouldn’t trash it.

I’m aiming this thought especially at many of my conservative friends who seem to be trashing the improving economic outlook — largely, it would appear, to discredit the Obama administration.

Don’t do it folks. It’s a mistake. The numbers are the numbers.

 There you go.   The economy is getting better and there is no point in saying it isn't.  However,  Kudlow warns (mostly correctly my view) that the good news might not continue.    The reason though, is that Kudlow thinks a future tax increase will run the train off the tracks.  As evidence he points to the Clinton tax increase:

Recall that when Hillary Clinton took her Rose Law Firm bonus in December 1992, rather than January 1993, she knew full well that her husband Bill would raise the top tax rate in 1993. So the fourth quarter of 1992 grew at nearly 4.5 percent, but the first quarter of 1993 saw less than 1 percent growth. The temporary growth spurt for all of 1992 was 4.3 percent, but activity dropped to 2.7 percent the following year.

That's an odd statement.  I'm pretty sure Hillary Clinton took her Rose Law Firm bonus in 1992, because she stopped working at the Rose Law Firm in 1992.   Most companies don't give bonuses to people who don't work there.  Also Bill Clinton didn't take office until January 1993, and the tax bill wasn't passed until later that year, so I'm not sure how much you can attribute the 1993 economic growth to a tax bill that hadn't been passed yet.      But I'll concede the point, let's just start at 1993.  However, I do think we should look at the next eight years, and compare them with the Reagan years to see how Kudlow's hero stacks up.

Over the period 1981-1988, GDP grew by 27% (adjusted for inflation of course).   That's not too bad, and in Kudlow credit Reagan's tax cuts for much of that. 

But in the period 1993-2000, GDP grew by 31%.   And that was in the throat of Kudlow's economy-killing tax hike.

I personally wouldn't tie tax rates soley to GDP.  But that's what Kudlow did.  And by his method, Reagan comes out a loser.