Monday, April 25, 2011

Tax cuts are theft

Yeah, I said I was going to look at the budget battle from the GOP side of things. I didn't say it would be pleasant. And, yes, that is a prejudicial statement. It's also true.

Boehner and the GOP House leadership may say they are glad they avoided a government shutdown, but many GOP members are itching for that shutdown, looking for any excuse to do so. This time, they say, we'll do it right, get away with it, and make sure we don't get the blame. They even has a slogan: "Gut or Shut." There is no third option. This posting has a long list of conservative pundits and GOP politicians vowing to gut or shut.

Dave Johnson of Campaign for America's Future wrote about the GOP threat way back at the beginning of January. I didn't read about it until I followed the link in the post I reference above. Johnson says the shutdown threat is intentional and is part of the GOP plan stretching back 30 years. Yes, that means the Bush deficits after the Clinton surpluses were intentional.

The reason for all this -- for running up these huge deficits? Engineer gutting everything the US government does for anyone other than the richest people. The excuse, as we've heard, is "We can't afford it." In particular, they aim to gut anything that protects us from the power of predatory corporate wealth. And what might that include? Environmental protection, worker safety, health care, consumer protections, retirement, and anything a corporation has to shell out that doesn't benefit the top management. What won't get cut is corporate subsidies of any kind, including bailouts.

Back before the 2010 elections the GOP wrestled Obama to a compromise to trim Medicare. Their election campaign right after that was, "Obama cut a half trillion out of Medicare." It was quite effective. The GOP is aiming for the same sort of compromise over Social Security -- force him to cut then blame him for those same cuts to drive him from office in 2012.

Obama has a way out of this mess. A debt default -- the next money battle -- won't harm the little guy (most of us) very much but would decimate Wall Street. The Fat Cats on Wall Street are playing a dangerous game. They support threatening to not raise the debt ceiling because they are betting that Obama will cave again (and why would they believe that?) and that the debt ceiling bill can be loaded up with all kinds of candy for Wall Street. But if they lose that bet, they lose big. So if Obama said, "I will only sign a clean debt ceiling bill," he could win this round. Social Security and other big issues should not be discussed at the point of a gun.

Not that you need more evidence of GOP crazy logic, here is more for you. The GOP House passed a budget (the one that essentially guts Medicare) that includes a $1.9 trillion deficit. They are threatening to refuse to pass a bill that will allow them to pay for that deficit.

To help their PR campaign to gut or shut, the GOP has a wide array of catchy explanations describe taxes. Here are a few:

* Taxes are theft.

* Tax me and I won't work. Sounds like a 5 year old asked to do chores.

* The rich already pay most of the taxes (a claim that ignores sales, property, vehicle, phone, and utility taxes).

* Rich people create jobs.

* If you tax us we'll leave. Are these the people who tell us "Love it or leave it"?

* The rich will find loopholes and won't pay anyway.

* The rich don't have enough to pay off the entire debt, so don't tax them at all.

* Taxes are just a liberal attempt to punish the rich.

In response Terrence Heath has gathered together a list of things we know about taxes. There is a difference between ideology and proof. He has a link for each item.

* The wealthy don't leave (well, some do, but good tax policy makes more wealthy, who like what a sensible government does for them).

* Tax cuts don't stimulate the economy.

* The rich don't spend their tax cuts.

* Tax cuts don't create jobs.

* Tax cuts don't spur growth enough to pay for themselves.

* Tax cuts for the rich benefit only the rich.

* Tax cuts don't spread prosperity.

* Taxes for the rich (compared to everyone else) are really low.

Heath itemizes the misconceptions. Dave Johnson (again) delves into the detail, with analysis and charts, meaning actual science instead of ideology. This is an interesting one to delve into. Johnson makes an important point. The data correlating prosperity with higher taxes does not prove causation, but does disprove the GOP claim that tax cuts stimulate the economy. Johnson concludes by saying tax cuts break the social contract. Taxes are theft? Nope. Tax cuts are theft.

So how does the GOP convince the rest of us (middle class, working class, and poor) to vote for them when their policies are working mighty hard to destroy us? It takes a convoluted PR campaign. Some of the items in their list.

* Convince us that the debt is the most important and urgent problem and the only one that matters, outweighing unemployment, poverty, illness, and needs of the elderly. How many times have you heard "Financial Armageddon" lately?

* Convince us that spending is the problem, not tax cuts or two unfunded wars.

* Tell us that low taxes for the wealthy are simply a political reality.

* Lie about Social Security's future and Medicare's true problems.

* Create bogus economic theories to give it all a scientific veneer.

* Move the debate so far right that the social contract that even the GOP supported for 50 years is "impractical."

* Create a "theology of compromise" that values consensus over results.

* Fund conservative think tanks to run talking points past focus groups and figure out ways to misuse economic data.

How have they been doing? Quite successfully so far.

Paul Ryan, the representative who came up with the House GOP budget that was passed with great fanfare, is a fan of author Ayn Rand. Jonathan Chait of Newsweek tells us a bit of what that means.

Karl Marx said that workers produce the wealth of a society and corporate owners are nothing more than parasites. I'm not a Marx or socialist scholar so I may not have that correct. Rand turns that upside down. The capitalists produce wealth and the workers are parasites.

One big thing to note. Marx created his philosophy based on evidence (even if just empirical) of the world around him. Rand wrote fiction, which doesn't need to have much basis in reality. Ryan is now basing real world policy on the fiction of Rand.

And that policy can be devastating. Ryan's plan does two things: hurt the poor and help the rich. As Ryan puts it he wants incentives for the poor to get off their lazy butts. Welfare reform (which put limits on handouts) was apparently not enough of an incentive. Time to take away food and health care too.

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