Borrow And Spend Republicans Unveil Tax Cut Package
There is something about Washington and taxes that seems to destroy the ability of law makers to do simple math. This seems to afflict Republicans and Blue Dog Democrats the worst. The Washington Post is reporting about the roll out of the Republicans Orwellianly named tax plan, the Tax Hike Prevention Act. Sen. Mitch McConnell (the man voted most likely to turn into a snapping turtle in our lifetimes) has put the idea on the table permanently extend all of the Bush era tax cuts, including the ones for the ultra wealthy, that top 2% of all earners.
From the WaPo :
"We have a spending problem. We spend too much. We don’t have a taxing problem. We don’t tax too little," McConnell told reporters Tuesday. "And if we want to begin to get ourselves out of this economic trough that we’re in, the only way to do that is to grow the private sector."
This is insane. We are currently collecting tax revenues at the same we did in 1950. In 2009 taxes were 9.2% of all personal income, just like it was when Harry Truman was president. A lot of things have changed since that time, the population has doubled and unlike now, in 1950 the United States was running a surplus. For Senator McConnell to say we are taxing too much is just another example of Republican bizzaro world, where black is white and up is down.
It is true there are other differences from 1950; we have enacted more social safety net programs since President Truman’s time. Medicare and Medicaid have assured that our poor and elderly are no longer left completely on their own for health care. These are expensive programs to be sure, but they are also very popular. To get the 3.9 trillion (39,000 billion, don’t cha’ know?) the THPA would cost over the next decade we would have to either barrow all that money or make deep, even draconian cuts in the Federal Budget.
There might be a way to do that, if the cuts were going to be spread out over the whole budget (still a really bad idea) but the Republicans are not going to let defense spending be on the table. They will go after the very programs that provide a safety net for all citizens, Social Security, Medicaid and Medicare.
The reality is that we under tax. We have for decades, which is why we have the level of debt that we do. The Bush administration is the first in the history of the United States that did not raise taxes during a time of war. They poured hundreds of billions into our military adventures in Iraq and Afghanistan, borrowing all the while. This was on top of the unpaid for tax cuts which are due to expire this December. The result is the huge deficits which we now have. They knew what they were doing, the criminal Vice President Dick Cheney famously (or is that infamously?) said that deficits don’t matter. Well, they really do. When you spend more money than you have sooner of later you have to pay it back. The time to start paying it back is now and the people who need to start are the ones who have benefited the most from the Bush tax cuts, the ultra wealthy. For those making a million dollars or more a year the Bush tax cuts have meant that they did not pay $100,000 in taxes a year. That is more that the vast majority of us make in a year.
This meme that the public sector will create more jobs if there is less tax on personal income is also a fallacy. The very same Bush tax cuts that Sen. McConnell wants to extend in perpetuity were in place during most of the Bush administration. The total net number of jobs created during the entire Bush presidency was a negative 630,000. In an economy that is struggling to create enough jobs for the millions of unemployed no policy that failed this spectacularly should be taken seriously.
There was a time when the Republicans were not insane on taxes. Their patron saint, President Regan raised taxes in seven of his eight years. While I was never a fan of the Gipper, he did know that there were times when taxes must go up. Even though he spent a hell of a lot more than he collected and expanded the federal debt more than just about any other administration he knew there was a limit to the amount that could be borrowed. This seems to be lost on Sen. McConnell and the Republicans.
They have gotten themselves in a real box. By encouraging their radically reactionary base, with its insistence on ideological purity, they have left themselves with no room to maneuver. The public is not willing to see major cuts in federal programs. Even the Tea Party folks don’t want Social Security and Medicare cut. Yet that same base is not going to go along with tax increases which will be required.
All this leads to the Republicans turning themselves into pretzels. They have to insist that tax cuts don’t have to be paid for, but we must reduce the deficit. Well there are two ways to reduce a deficit, you can cut programs or you can collect more revenue. We have seen what borrow and spend Republicans will do to our nation. It is time to return to the collecting the proper amount of money from our ultra wealthy so we can pay for the things this nation needs, like roads and bridges and high speed freight. Tax and spend might have sounded bad, but borrow and spend is worse.
The floor is yours.