by F. Grey Parker
My first reaction when I finished reading The Path To Prosperity, Rep Paul Ryan's (R-WI) highly anticipated "budget," was to wonder where the rest of it was. It's like an introduction without a following body of work. The calculated lack of specificity is stunning. It's a buffet of political talking points.
There are certainly many scary charts, spooky graphs and a lot of Neo-Con think-tank phrases. But to call it a "budget" is an insult to arithmetic itself. In fact, at his press conference earlier this afternoon Ryan said it "is not just a budget, it’s a cause." With all due respect, faith doesn't secure the outcome of financial equations.
Let's look at the Ryan scheme:
"Keeps taxes low so the economy can grow. Eliminates roughly $800 billion in tax increases imposed by the President’s health care law. Prevents the $1.5 trillion tax increase called for in the President’s budget. Calls for a simpler, less burdensome tax code for households and small businesses. Lowers tax rates for individuals, businesses and families. Sets top rates for individuals and businesses at 25 percent. Improves incentives for growth, savings, and investment"
"Keeps taxes low so the economy can grow. Eliminates roughly $800 billion in tax increases imposed by the President’s health care law. Prevents the $1.5 trillion tax increase called for in the President’s budget. Calls for a simpler, less burdensome tax code for households and small businesses. Lowers tax rates for individuals, businesses and families. Sets top rates for individuals and businesses at 25 percent. Improves incentives for growth, savings, and investment"
Taxes are at their lowest levels in modern history and have been for years. There has been no corresponding expansion of the economy. What's more, the $800 billion in prevented "tax increases" he touts is predicated on the complete repeal of HCR. That is not going to happen. There is no demonstrably broad benefit to the U.S. economy from the hyper-wealthy having a tax rate of 25%. A 10% drop in the corporate rate with not one single loophole singled out for elimination is ridiculous.
We have to substantially raise taxes and soon. I say it. Krugman says it. Reich says it in no uncertain terms. In fact, a majority of Americans say it. And yet, Ryan skips merrily through an alternate reality.
Ryan actually cites economic projections from the Heritage Foundation as supporting data within the plan itself. The same Heritage Foundation that said "pro growth tax cuts... always create jobs" while arguing for the extension of the disastrous W Tax Cuts that didn't create jobs. As a matter of fact, the weakest ever post-Depression job creation accompanied that fiscal policy. Of course, that's not what Heritage had projected prior to their initial implementation. Matt Yglesias dug up this gem today.
Heritage prosperity projections that they insisted would follow passage of the W Tax Cuts...
The entire payroll expansion under W came to 2.3% which is almost six times smaller than the expansion rate under just 4 years of Jimmy Carter! Ryan's plan is a larger dose of the same failed "stimulative policies" which have caused this mess. But by all means, let's assume that Heritage is totally correct... this time.
The subject of our revenue in-stream is carefully packaged alongside political triggers designed to provoke panic:
"As economic growth deteriorates, it becomes harder for the government to raise revenue through taxes, and a vicious cycle ensues. If the nation ultimately experiences a panicked run on its debt, it will be forced to make immediate and painful fiscal adjustments (like the austerity program that has provoked riots in Greece)"
America/Greece comparisons are absurd. They are also dishonest. The crisis in Greece was caused by two principal factors. The first is that their economy was so much smaller than ours and not complexly diversified. The second is that they invested their national treasure heavily in our own under-regulated derivatives markets. These are the same markets that Mr. Ryan doesn't want to "over-regulate."
The entire payroll expansion under W came to 2.3% which is almost six times smaller than the expansion rate under just 4 years of Jimmy Carter! Ryan's plan is a larger dose of the same failed "stimulative policies" which have caused this mess. But by all means, let's assume that Heritage is totally correct... this time.
The subject of our revenue in-stream is carefully packaged alongside political triggers designed to provoke panic:
"As economic growth deteriorates, it becomes harder for the government to raise revenue through taxes, and a vicious cycle ensues. If the nation ultimately experiences a panicked run on its debt, it will be forced to make immediate and painful fiscal adjustments (like the austerity program that has provoked riots in Greece)"
America/Greece comparisons are absurd. They are also dishonest. The crisis in Greece was caused by two principal factors. The first is that their economy was so much smaller than ours and not complexly diversified. The second is that they invested their national treasure heavily in our own under-regulated derivatives markets. These are the same markets that Mr. Ryan doesn't want to "over-regulate."
What actually makes it "harder for the government to raise revenue through taxes," is cutting taxes, allowing rampant loophole abuse and refusing to impose taxes in the first place.
The obvious initial steps towards solving our problems are as follows; Expire the W Tax Cuts, return the highest marginal individual rates to Eisenhower Era levels and set the top corporate tax rate on profits at a flat 15% with no loopholes.
Describing Ryan's collection of fantasies as Reaganomic nonsense, which I did earlier today, is actually unfair to the Gipper. When President Reagan was confronted with the destructive and unsustainable reality of tax rates that were substantially higher than today's, he signed bills into law which raised them 7 times.
One must wonder. If Rep. Paul Ryan and his ilk were presented with an actual Reagan budget today, would they portray it as "progressive?"
This "Path" isn't conservatism. It's corporatism. It's less Jefferson than it is Mussolini.
Rep. Ryan doesn't need to give any details, he's counting on the Senate or President, to be the ones that say 'No' -- stopping his efforts to do what the misguided Tea Party and Corporate backers, want him to do. He had to make it outrageous enough, to ensure the Democrats are the ones saying, 'NO'.
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