March 19, 2003

March 19, 2003 | News Releases on Smart Growth

Nation Would See More Jobs, Higher Incomes Under Bush Plan, Analysis Shows

WASHINGTON, MARCH 18, 2003-Over the next five years, President Bush's economic growth plan would create, on average, more than 914,000 jobs annually across the country, according to an econometric analysis released today by The Heritage Foundation. The stimulus package would produce results almost immediately, the analysis found, generating 997,000 new jobs next year.

Americans' personal savings also would grow by $111.5 billion next year, say analysts in Heritage's Center for Data Analysis. Over the next five years, nationwide personal savings would increase by an average of $66.3 billion annually, and disposable income would rise by an average of $141.4 billion per year under the Bush plan.

In evaluating the president's proposal, CDA analysts used what economists call "dynamic" analysis-a method employed for years by state governments, private businesses and Fortune 500 companies that accounts for how people will react to changes in tax policy. The method differs significantly from the "static" method the Congressional Budget Office uses.

"Static" scorers don't account for predictable changes in behavior, a position Heritage economist William Beach considers illogical. "The critics running down the president's plan don't seem to appreciate that when you cut taxes, you change how taxpayers behave," he said. "The tax cuts included in the president's proposal will strongly induce taxpayers to save more, spend more and invest more."

More state-by-state numbers can be found online at Heritage's "Reality Check" on taxes.

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