-Submitted by David Durmm (Nal), Guest Blogger
Although Rep. Paul Ryan (R-WI) had initially received praise for his budget proposal, upon more careful analysis, many, like Nobel laureate Paul Krugman, have found it to be Ludicrous and Cruel. A principal feature of his budget is tax cuts for the wealthy, from 35 percent to 25 percent. But not to worry, remember that tax cuts magically pay for themselves. Phase 1, cut taxes for the wealthy. Phase 2, ? Phase 3, prosperity.
Rep. Ryan’s budget relies on economic forecasts provided by the Heritage Foundation showing an unemployment rate of 2.8% by 2021. This seems like déjà vu all over again.
The Heritage Foundation also predicted massive economic gains from President George W. Bush’s tax cuts for the rich. The chart below show the Heritage predictions for employment in blue and the actual numbers in red.
The 2.8% prediction was so ludicrous and subject to so much ridicule, the figure vanished from the Heritage Foundation’s web site. Yet it is the Heritage Foundation’s model that Rep. Ryan cites as the analytical basis for his claims of job growth.
Ryan has been down this road before. In his “Roadmap For America’s Future”, Ryan proposed massive tax cuts for the rich. In a report from the Tax Policy Center, their analysis showed “[f]ederal revenues under the Roadmap would decline substantially as a percentage of GDP.”
To make up for lost federal revenues, tax increases for the middle class, through tax bracket “consolidation,” would be unavoidable.
H/T: Center for American Progress, Michael Linden, Matthew Yglesias.
Elaine,
Great links. If only the real Republicans would take back control of their party, we wouldn’t be in this hole.
TPMDC
Conservative Economists Criticize ‘Off The Deep End’ Republican Budget
Brian Beutler | April 11, 201
http://tpmdc.talkingpointsmemo.com/2011/04/conservative-economists-criticize-off-the-deep-end-republican-budget.php?ref=fpb
Excerpt:
Now that Republicans and Democrats have supposedly figured out how to fund the government through September, Congress’ attention will turn to other issues, including the GOP’s 10 year vision for the country: Paul Ryan’s budget proposal, which includes Medicare privatization, severe cuts to Medicaid, and further tax breaks for the wealthy.
While the government teetered on the brink of a shutdown last week over short term funding, economists across the ideological spectrum weighed in on the GOP’s long-term plan with negative reviews. The biggest shock came from high-profile economists with GOP leanings, who also criticized it on the merits.
“It doesn’t address in any serious or courageous way the issue of the near and medium-term deficit,” David Stockman told me in a Thursday phone interview. “I think the biggest problem is revenues. It is simply unrealistic to say that raising revenue isn’t part of the solution. It’s a measure of how far off the deep end Republicans have gone with this religious catechism about taxes.”
Stockman, who directed Ronald Reagan’s Office of Management and Budget, approves of Ryan’s entitlement proposals, but breaks faith over taxes and the GOP’s unwillingness to slash defense spending. And he laughs off the notion that the plan will do anything about unemployment, let alone dramatically reduce it, which Ryan and his plan claim it will. “This isn’t 1980. It’s not morning again in America. it’s late afternoon, or possibly even sunset.”
Off Topic:
FLASHBACK: Senate Republicans Raised The Debt Ceiling Immediately After Passing The 2003 Bush Tax Cut
By Pat Garofalo
Think Progress, 4/11/2011
http://wonkroom.thinkprogress.org/2011/04/11/senate-debt-limit-flashback/
Excerpt:
With the debate over the fiscal 2011 budget now, for the most part, behind it, Congress will have to address other budgetary matters, with the most urgent being the debt ceiling. According to Treasury Secretary Timothy Geithner, the U.S. will hit its debt limit — the maximum amount that it is legally allowed to borrow — no later than May 16, unless Congress acts.
Plenty of Republicans have been saying that they won’t vote to raise the debt ceiling — and thus risk the economic cataclysm that would result if the U.S. defaulted on its debt — unless they receive various other budget-related measures, including a balanced budget amendment, statutory spending caps, or, in the case of Sen. Marco Rubio (R-FL), just about every budget idea that has ever been mentioned by a Republican. Friday night, Senate Minority Leader Mitch McConnell (R-KY) said that no Republican would vote to increase the debt limit “unless we do something about the debt. And you can write that down!”
But in May of 2003, the GOP was not only willing to raise the debt ceiling in the absence of debt reduction measures, but it did so on the same evening that it blew a brand new hole in the federal budget by approving a giant tax cut for the wealthy:
Without comment or ceremony, President Bush on Tuesday signed a bill allowing a record $984 billion increase in the amount the federal government can borrow, to a record $7.4 trillion. The increased federal borrowing will enable the government to pay for the $350 billion economic stimulus package that the GOP-led Congress passed last week at Mr. Bush’s behest.
Swarthmore mom 1, April 11, 2011 at 8:28 am
We will all need a nursing degree.
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On the face of it, (haven’t read the link…) that is only fair since at this point in time we all seem to need a law degree…. (just to survive the law!)
Thanks, Swarthmore mom. It’s good to be back…
Glad you are back, anon nurse.
Swarthmore mom:
That was sobering…
(And they’ve got their boots on the ground in our communities, as I’ve said before. Big trouble ahead, it would seem.)
The ad above is sponsored by the Tea Party Express. It is worth looking at because it is a preview of the 2012 campaign.