President Bush, and to a large extent the Republican Party, have supported and passed significant tax cuts over the last 6 years. Tax cuts, generally speaking, mean that the government is taking in less money. It has been argued recently that tax cuts actually have the effect of increasing government revenue by giving businesses and individuals more resources to spend and/or produce. This, the arguement goes, has the effect of broadening the tax base. When he signed the most recent tax cut, passed in May of 2006, the Tax Relief Extension Reconciliation Act, President Bush discussed the idea of growing the economy:
"Part of our strategy to cut the deficit in half is to continue to grow this economy. Tax relief has helped a growing economy, which means more tax revenue for the federal treasury. 2005 tax revenues grew by $274 billion, an increase of nearly 15% over the previous year. This year the economy is still growing, and tax revenues are growing with it. So far, tax revenues are 11 percent higher than they were at the same point last year, which is better than projected. More than a quarter of these tax revenues come from corporations who pay more because they're growing with the economy." (30)

The theory that we can cut taxes without corresponding spending cuts, and cut the deficit has been met with a good amount of skepticism.
"[The notion] that tax cuts stimulate so much extra growth that tax revenue will remain the same or even rise after rates are cut [...] just ain't so at least not at the federal level, and not given where taxes are already. A $1 cut in tax rates may generate an extra 25 or 50 cents in revenue, but not near the full $1." (31).

"As for permanent tax cuts, [Milton] Friedman taught us they were a fine idea as long as we remembered that they were not tax cuts at all unless accompanied by permanent spending cuts. Otherwise, they were simply a shift in taxes to future taxpayers which is to say a tax cut for us, but a tax increase on our children." (32)

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Political Pledges and Realities