[Vision2020] Four Fiscal Phonies

[Art Deco]

  [image: The New York Times] <http://www.nytimes.com/>


------------------------------
March 1, 2012
Four Fiscal Phonies By PAUL
KRUGMAN<http://topics.nytimes.com/top/opinion/editorialsandoped/oped/columnists/paulkrugman/index.html?inline=nyt-per>

Mitt Romney is very concerned about budget deficits. Or at least that’s
what he says; he likes to warn that President Obama’s deficits are leading
us toward a “Greece-style collapse.”

So why is Mr. Romney offering a budget proposal that would lead to much
larger debt and deficits than the corresponding proposal from the Obama
administration?

Of course, Mr. Romney isn’t alone in his hypocrisy. In fact, all four
significant Republican presidential candidates still standing are fiscal
phonies. They issue apocalyptic warnings about the dangers of government
debt and, in the name of deficit reduction, demand savage cuts in programs
that protect the middle class and the poor. But then they propose
squandering all the money thereby saved — and much, much more — on tax cuts
for the rich.

And nobody should be surprised. It has been obvious all along, to anyone
paying attention, that the politicians shouting loudest about deficits are
actually using deficit hysteria as a cover story for their real agenda,
which is top-down class warfare. To put it in Romneyesque terms, it’s all
about finding an excuse to slash programs that help people who like to
watch Nascar events, even while lavishing tax cuts on people who like to
own Nascar teams.

O.K., let’s talk about the numbers.

The nonpartisan Committee for a Responsible Federal Budget recently
published an overview of the budget proposals of the four “major”
Republican candidates and, in a separate report, examined the latest Obama
budget. I am not, by the way, a big fan of the committee’s general role in
our policy discourse; I think it has been pushing premature deficit
reduction and diverting attention from the more immediately urgent task of
reducing unemployment. But the group is honest and technically competent,
so its evaluation provides a very useful reference point.

And here’s what it tells us: According to an “intermediate debt scenario,”
the budget proposals of Newt Gingrich, Rick Santorum, and Mitt Romney would
all lead to much higher debt a decade from now than the proposals in the
2013 Obama budget. Ron Paul would do better, roughly matching Mr. Obama.
But if you look at the details, it turns out that Mr. Paul is assuming
trillions of dollars in unspecified and implausible spending cuts. So, in
the end, he’s really a spendthrift, too.

Is there any way to make the G.O.P. proposals seem fiscally responsible?
Well, no — not unless you believe in magic. Sure enough, voodoo economics
is making a big comeback, with Mr. Romney, in particular, asserting that
his tax cuts wouldn’t actually explode the deficit because they would
promote faster economic growth and this would raise revenue.

And you might find this plausible if you spent the past two decades
sleeping in a cave somewhere. If you didn’t, you probably remember that the
same people now telling us what great things tax cuts would do for growth
assured us that Bill Clinton’s tax increase in 1993 would lead to economic
disaster, while George W. Bush’s tax cuts in 2001 would create vast
prosperity. Somehow, neither of those predictions worked out.

So the Republicans screaming about the evils of deficits would not, in
fact, reduce the deficit — and, in fact, would do the opposite. What, then,
would their policies accomplish? The answer is that they would achieve a
major redistribution of income away from working-class Americans toward the
very, very rich.

Another nonpartisan group, the Tax Policy Center, has analyzed Mr. Romney’s
tax proposal. It found that, compared with current policy, the proposal
would actually raise taxes on the poorest 20 percent of Americans, while
imposing drastic cuts in programs like Medicaid that provide a safety net
for the less fortunate. (Although right-wingers like to portray Medicaid as
a giveaway to the lazy, the bulk of its money goes to children, disabled,
and the elderly.)

But the richest 1 percent would receive large tax cuts — and the richest
0.1 percent would do even better, with the average member of this elite
group paying $1.1 million a year less in taxes than he or she would if the
high-end Bush tax cuts are allowed to expire.

There’s one more thing you should know about the Republican proposals: Not
only are they fiscally irresponsible and tilted heavily against working
Americans, they’re also terrible policy for a nation suffering from a
depressed economy in the short run even as it faces long-run budget
problems.

Put it this way: Are you worried about a “Greek-style collapse”? Well,
these plans would slash spending in the near term, emulating Europe’s
catastrophic austerity, even while locking in budget-busting tax cuts for
the future.

The question now is whether someone offering this toxic combination of
irresponsibility, class warfare, and hypocrisy can actually be elected
president.


-- 
Art Deco (Wayne A. Fox)
art.deco.studios at gmail.com
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/vision2020/attachments/20120302/274f1c4f/attachment.html>