Tuesday, November 10, 2015

GOP presidential candidates still cling to failed voodoo

Not that I'm watching the GOP Debate (I'm watching the Mike Tyson vs. Evander Holyfield "30 for 30", which is much more interesting), but I want to direct you to an excellent article from Slate.com's Jordan Weissman discussing the real cost of the tax cuts proposed by GOP candidates. And not surprisingly, these tax cuts would hurt a lot of people if these GOP candidates also chose to balance the budget by cutting spending in other areas.
Take the proposals put forth by the two mainstream Republican favorites, Marco Rubio and Jeb Bush. So far, two notable think tanks, the left-leaning Citizens for Tax Justice and the conservatively inclined Tax Foundation, have scored their plans. They each arrive at vastly different cost estimates of the proposals, in part, from what I've been told, based on the different ways they handle changes to the corporate tax code and whether you factor in the pro-growth effect of lowering rates. But I'm not going to get into which group is more on target here, because they essentially point to the same conclusion: No matter how you run the math, these cuts are gargantuan. And the best way to see that is by comparing them to what the federal government currently spends on its major programs.

Let's start with Rubio. Citizens for Tax Justice believes that his plan will ultimately cost the government $11.8 trillion over 10 years. That's just slightly less than the roughly $12 trillion the entire Social Security program is expected to cost from 2016 through 2025, according to the Congressional Budget Office. It's also more than the $9.1 trillion.

The Tax Foundation is slightly more optimistic. Based on its static scoring approach, which doesn't take into account the feedback effects of economic growth, it thinks Rubio's plan will cost about $6.1 trillion, which is a shade less than what the government expects to spend on defense from 2016 through 2025. Yes, that's all defense. (Also worth noting: The group scored Rubio's plan before he added one additional tax bracket for upper-middle-classers, which should add to its expense.)

Weismman also looks at Jeb Bush's proposed tax cut, and while it's not an absurdly huge as Rubio's, but it still would be between $1.6 and $7.1 trillion (likely closer to $7.1, given that the $1.6 trillion figure uses "dynamic scoring", which falsely assumes there is some magic multiplier of growth that offsets the tax cuts). And Weissman mentions that no matter how you slice it, these GOP tax-cutting plans are insane, and again proves that "compassionate fiscal conservatives" are nothing of the sort.
Again, these are the tax plans on offer from the two leading mainstream GOP candidates for president. To make them work while eventually balancing the budget (as these men supposedly want to) would require excising massive chunks of the federal government in a manner that would undoubtedly fall hardest on the poor. Which is to say, a mainstream Republican in no way shape or form means a reasonable Republican.
Of course, maybe putting in reckless tax cuts are part of the plan, so the cuts on the poor and the aged can be excused away in the need to close the inevitable deficit, and privatization will have to be expanded. We know how that works right here in Wisconsin.

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