Kemp was a football player who changed how economists understand the way the world works.
Kemp was a congressman who never rose to be a Senator, governor or president yet he changed how his Party talked, campaigned and governed.
Kemp was a patriot whose tax cuts, once enacted turned America around from economic decline and international retreat to growth and bloodless victory in the cold war.
Kemp was an American who has created millions of jobs and opportunities in other nations because they watched American success and copied Kemp’s low tax policies. Others followed the shining city on the hill. Today many nations once behind the iron curtain have low and flat income tax rates.
Kemp took supply-side economics, the common sense idea that lower tax rates will increase the incentives for work, savings and investment and put them in legislative form, the Kemp-Roth 33 percent income tax rate cut. He spent the better part of a decade explaining patiently, dramatically and repeatedly and repeatedly that the path to more jobs, economic growth and low inflation came not from the Keynesian theory that if the government borrowed and spent more money the economy would flourish — demand side economics.
Kemp had allies in promoting “supply-side” economics in Art Laffer, Jude Wanninski, Robert Bartley of the Wall Street Journal editorial page and Washington Post columnist Robert Novak. By 1978, the Republican Party endorsed his vision and the House republican caucus ran on its first version of the “contract with America” with one simple promise “Republican Tax Cut 33%.”
Ronald Reagan ran for president in 1976 and failed. Four years later Reagan endorsed Kemp-Roth and won both the primary and general election. Many believed the obvious choice for Vice-president would have been Jack Kemp.
The Kemp-Roth tax cut was passed in the summer of 1981 and tax rates were cut 25 percent across the board. When the tax cuts became fully effective in 1983 the economy created four million jobs that year. During the Reagan presidency, the top marginal income tax rate fell from 70 percent to 50 percent in 1981 and then to 28% in 1986. To understand the power of this change, when Reagan was elected an American small businessman paying the top income tax rate who earned an additional $100 got to take only $30 home after taxes. When Reagan left office, the same $100 earned was taxed at 28% and the taxpayer got to take home 72 dollars. The return to savings, investment and work more than doubled. Only liberals were surprised when America got more of each.
Lower marginal tax rates reduced the government drag on the economy, unemployment fell, incomes and wealth increased and the stock market increased in value by Trillions. This growth allowed American to afford to expand military spending to checkmate the Soviet Union. Economic success gave Reagan and Republicans the ability to win presidential elections in 1984 and 1988 bringing Supreme Court appointments, deregulation and the collapse of the Soviet Union.
All of Reagan’s successes were made politically and economically possible by Jack Kemp’s tax cuts. That alone would earn Kemp a place in American history, but Kemp also pioneered specific and targeted conservative, pro-growth policies to compete with and displace failed liberal programs to combat poverty in corrupt welfare clogged inner cities and the failure of public housing,
In today’s jargon, Kemp was not a man who stood athwart history saying “no.” He envisioned, created and promoted common sense solutions consistent with American liberty and self-governance. He built a better mouse trap. One that worked.
Before Kemp was Nixon and Ford. They looked at failed liberal spending programs and offered to fund them 80 percent. That passed for American conservatism for too much of a dark and dreary decade. Kemp rebranded the party. Kemp was John the Baptist with better hair. Reagan won as captain of the Team created by Kemp’s vision.
In the Wake of the 2006 and 2008 elections many conservatives have asked, “Where is the next Reagan?” The first question to be answered, however, may be, “Where is the next Jack Kemp?”