Tag: tax cuts

…the most plausible deficit reduction plan is to rely on gridlock rather than cooperation. Obama yesterday held absolutely firm in his opposition to extending tax cuts on income over $250,000. If Obama won’t relent, then Republicans probably won’t relent on the rest of the tax cuts, and the whole thing will expire. And then, if Obama wins reelection, he’ll be most of the way toward a sustainable deficit, and the Republicans will have had their triumphalism beaten out of them. At that point, a deal to raise a little revenue by reforming the tax code plus spending restraint would be far more plausible.

Jonathan Chait, seemingly forgetting the part where Obama gets to campaign on the GOP eliminating tax cuts for the middle class because they weren’t getting tax cuts for the very richest of the rich. Who, you know, only destroyed the global economy and aren’t the most popular folks electorally. But by all means, GOP, campaign on an all fat-cat ticket. It’s working out great so far in the Midwest.

The Marker

Obama: In December, I agreed to extend the tax cuts for the wealthiest Americans because it was the only way I could prevent a tax hike on middle-class Americans. But we cannot afford $1 trillion worth of tax cuts for every millionaire and billionaire in our society. And I refuse to renew them again.
Kevin Drum:Question: is Obama laying down a marker in hopes of getting a bill that extends only the middle-class cuts? Or is he laying down a marker knowing that Republicans will refuse to budge and therefore the entire Bush tax cut package will expire?
Lemkin: He is putting the onus of middle class tax cut extension or expiration squarely on the GOP House, which is where it should have been all along. We would have had a very different outcome last time around if this had been the shape of the negotiation. There is very real power in pursuing a “do nothing” approach if Obama and the Democrats at large will just deign to use it. Shrill, I know, but following such a path would really punish the GOP and force them to come out squarely against their own stated goals again and again and all in defense of the very richest people on the Earth.

Ryan’s Motivations (or: Pie-O-My)

jeffmiller:

lemkin:

Kevin Drum wonders what drives Ryan to produce such a uniquely partisan budget document…

There is this strange notion that Ryan should not have proposed the plan he actually wanted, but that he was supposed to compromise before the Democrats even come to the table.  This is insane.  You don’t go to the car dealer and figure, “Well, I’d like to pay $22,000 for the Prius, but he’d probably like me to pay more, so I’ll start at $23,000.”  Ryan proposed the plan he wanted; the Democrats are now free to counter with any plan of their choosing, and maybe the sides will meet somewhere in the middle.

So what’s the problem here?  The problem is that Democrats don’t want to address the debt problem because it means they will either have to sacrifice programs they like or greatly increase taxes on the middle class.  There’s nothing fun about that choice, but Paul Ryan didn’t put us into the position where that choice has to be made.

Perhaps I wasn’t sufficiently clear: of course Ryan should swing for the fences. My frustration lies with the traditional Democratic impulse to start from the position of compromise in response to said fence-swinging proposal. They’ve know he was developing this plan, and the outlines of it, for weeks. In response, they’ve been working on marking up the deficit commission’s plan. My contention is that this is bad strategy unless you want a rightward shift in funding priorities.

But, I don’t consider returning to Clintonian tax rates “greatly increasing” taxes on anybody. Let the Bush tax cuts expire. Period. In a stroke, you’ve corrected at least half of the deficit issue. You can legitimately plan to make reasonable cuts and adjustments and but also just grow your way out of the rest of it, as the economy should be in much better shape by the time of that expiry.

Random Thought #371

politicalprof:

It should be remembered that no one—and I mean no one, of any party—who advocates more tax cuts for Americans, whether businesses or individuals, is serious about solving the American national deficit. The only reasonable response to anyone who follows a statement about the need to reduce or cure the United States’ national debt with a statement about the importance of more tax cuts is to laugh at them until snot runs out of your nose.

That this isn’t already the widespread response and being ceaseless spread and solidified by Democratic operatives as politicians of all stripes take to the hustings come 2012 is precisely why the Democrats fail. Period.

Until they accomplish that one thing: lancing the festering boil that begins with the merely foolish Laffer Curve and ends now with the grade-A, unadulterated horseshit in which tax cuts never even need to be budgeted for, and then successfully turn all of that into a massive and truly, viscerally horrifying joke that all representatives of the Tea Klan and their GOP enablers must run, run from at each and every stop (see: “maximum acceleration on BullshitOne, Charlie, they’ve got the pitchforks out here too!”), well, until that day: we’ll get precisely nowhere in this country.

No, Tax Cuts Do Not Pay for Themselves

thebroadermarket:

By Jordan Eizenga 

One can understand the attraction for thinking that tax cuts should stimulate higher rates of economic growth. With greater after tax income, workers are more likely to work harder and longer and, facing fewer taxes, entrepreneurs are in a better position to start companies and hire new workers. The problem is that the data does not bear this out either. For example, the Bureau of Labor Statistics, a statistical agency in the United States federal government, notes that over the past decade of lower tax rates, the number of business start-ups has actually declined.

Even if tax cuts generated increased economic growth rates, both conservative and liberal economists agree that economic growth would not increase anywhere near enough to offset the cost of the cuts.

The whole thing is absolutely required reading.

No, Tax Cuts Do Not Pay for Themselves

…nobody, and I mean nobody, in a position of influence within the GOP cares about deficits when tax cuts for the affluent are on the line. Deficit hawkery is just a stick with which to beat down social programs.

Paul Krugman, reacting to the shocking news that the rising GOP House Majority will be moving to change the rules in ways “clearly designed to pave the way for more deficit-increasing tax cuts in the next two years. These rules stand in sharp contrast to the strong anti-deficit rhetoric that many Republicans used on the campaign trail this fall […] these new rules […] could have a substantial impact and risk making the nation’s fiscal problems significantly worse.”
As Krugman says: these guys don’t care about the deficit, now or ever. They simply use concern to whip up anger against then-as-now non-existent “Cadillac Queens of Welfare” and whatnot such that ever more wealth can be transferred to the richest of the rich. And rest assured: they won’t be satisfied until they have it all. It’s what is going on in corporate America, and it’s what is going in political America. Well, such as the two spheres are even distinguishable anymore it’s what’s going on…

Quiet Down, We’re Playing the Inside Game

Good roundup of the Bush tax cut extension negotiations by Ezra Klein:

When the deal was cut, the president took an oblique shot at their preferences, saying “the American people didn’t send us here to wage symbolic battles or win symbolic victories.” And this came a mere week or two after the White House announced a federal pay freeze. The pattern, for progressives, seems clear: The White House uses them during elections, but doesn’t listen to, or consult them, while governing. In fact, it insults them, and then tells them to quiet down, they got the best bargain possible, even if it wasn’t the one they’d asked for, or been promised.
[…]

That the Obama administration has turned out to be fairly good at the inside Washington game of negotiations and legislative compromise and quite bad at communicating to the public and keeping their base excited is not what most would have predicted during the 2008 campaign. But it’s true.

Quiet Down, We’re Playing the Inside Game

The President’s Last Stand Was No Stand At All

robertreich:

The deal the President struck with Republican leaders is an abomination. It will cost $900 billion over the next two years — larger than the bailout of Wall Street, GM, and Chrysler put together, larger than the stimulus package, larger than anything that’s come out of Washington…

And don’t think for one second that the GOP won’t be out there, probably today, screaming:

This President’s $900 BILLION deficit exploder is going to destroy the country. It’s bigger than all his other giant spending programs in the government takeover department. He’s a profligate socialist of the kind we just can’t afford anymore. We in the GOP delivered you, the wealthy, massive tax cuts and are thus: Serious People.

The media will not lift a finger to connect the $900B to the massive tax cuts for the wealthy. Watch and learn, Democrats. Watch and learn.

The President’s Last Stand Was No Stand At All