Thursday, July 7, 2011

Is the GOP completely crazy?

 Or just crazy like a Fox?

Ezra Klein:
GOP's Roger "Fox" Ailes
There are two ways to read the current stalemate in the debt-ceiling negotiations. There’s David Brooks’s take, which is that watching Republicans pass up “the deal of the century” should leave conservatives convinced there’s something wrong with the GOP.
But you can also read it the opposite way: Democrats control the White House and the Senate, Obama is the most popular national political figure, a balanced approach to deficit reduction outpolls plans made entirely of spending cuts, and yet Democrats are still offering recalcitrant Republicans the deal of the century rather than taking to the ramparts. What’s wrong with them?

(Look at previous) deficit-reduction deals passed by Presidents Ronald Reagan, George H.W. Bush and Bill Clinton.

As you can see on the graph, in each case, taxes were at least a third of the total, and in Reagan’s case, his massive tax cuts were followed by deficit-reduction deals that actually relied on tax increases. Today, tea party conservatives would be begging Sen. Jim DeMint to primary the Gipper.

Enough to make you cry?

Speaker Boehner emotes
"When Congressional Republicans claim that the reason for their recalcitrance in budget negotiations is concern for the welfare of ordinary Americans, look more closely. Do we really want to close down the American government and risk another global financial crisis to protect the tax bills of billionaires"

Nick Kristoff explains - HERE - the "carried interest loophole" that the GOP is adamantly protecting with it's "No Taxes" tantrum, as they hold the country hostage over the deficit and debt ceiling. "Carried interest" allows billionaires - and by billionaires I mean guys who make billion$ ANNUALLY - to pay taxes on their income at less than half the established upper marginal rate.  Check out Kristoff's entire column.

Recovery for corporations - the hallowed "supply side" is doing just fine

Even the Wall Street Journal reported the "supply side economics free lunch" of tax cuts as a means of increasing government revenues effectively dead back in 2003.  After George W. Bush cut taxes, the conservative-leaning Congressional Budget Director, Douglas Holtz-Eakin, couldn't come up with figures showing tax revenues increasing in the wake of the tax cuts.  If the goal - as initially stated - was to fight the projected surplus in government solvency, it worked brilliantly.

That argument is over - at least among normal folks who aren't on ideological crack. But the persistent argument remains that cutting taxes for corporations generates essential capital that will be directed to creating new jobs - that increasing corporate profitability inevitably leads to a robust, growing economy and employment for just about anyone willing to work.

There certainly may be particular, targeted scenarios - such as cuts in employer payroll taxes or credits tied to new employment  - where the desired effect of job-creation can be enhanced by tax breaks, but overall evidence for a rebound of corporate profitability as the magic bullet that will get us out of a deep jobs slump appears slim to non-existent.

Andrew Leonard at Salon has the facts and figures: