Tuesday, February 15, 2011

Uncomplicated Math, Likely To Be Ignored

"It's much less awful than the Republican proposal."

Paul Krugman thus assesses the budget proposal unveiled by President Obama yesterday. But then, that could be the slogan for the center-right Obama Administration: We're Not as Bad As Those Extremists Are.

And of course they're not. The GOP wish is for far more draconian cuts than the President has offered. South Carolina's Jim DeMint, chairman of the Senate Steering Committee, contends "The President has offered an unserious budget that ignores the warnings of his own bipartisan debt commission and.... would push us over the edge into generational debt." U.S. Representative Mike Pence of Indiana warned that "we must reject the fiscal recklessness and unsustainable path outlined in the President's budget and come together around the principles of fiscal discipline and reform and put our fiscal house in order."

Then they released the Tax Relief Certainty Act which, according to their press release:

■Make permanent the 2001 and 2003 individual income tax relief for all hard-working Americans — preserving the 10%, 15%, 25%, 28%, 33% and 35% income tax brackets, rather than allowing President Obama and Democrats to increase the top tax bracket to 39.6% and increase taxes on the lowest earning Americans in the bottom 10% bracket;

■Permanently repeal the immoral and unfair death tax, which increases from 35% to 55% on Jan. 1, 2013. Permanent repeal of the death tax would increase GDP by $118.8 billion and lead to $23.3 billion per year in new federal revenue;

■Prevent the tax increase on capital gains and dividends income for all Americans, rather than allowing the Democrats to increase the rates to 20% from the current 15%; and

■Permanently patch the Alternative Minimum Tax (AMT).

No kidding- that was approximately two hours after Pence slammed President Obama for mere "talk of fiscal discipline." Presumably, they could have waited a day or two before obscenely contradicting themselves but, having little to fear from the Republican-leaning mainstream media, that would have been mere dawdling.

Cenk Uygur still of The Young Turks and now of MSNBC, put it sufficiently succinctly that even traditional media outlets, accustomed to reporting tax and spending issues from a conservative mindset, should be able to understand (transcript here):

(President Obama) has cut $200 billion over the next two years. Two billion in savings. That`s got to do it, right? That`s a huge amount to cut.

Well, as it turns out, again, let`s do math. I like math on this program. As you remember, they just had an $858 billion in tax cuts over the next two years. So when you subtract the $200 billion that they just cut from the $858 billion in tax cuts, well, you`ve got $658 billion to go and you still haven`t made it up.

So what I`m telling you is, these cuts that he`s doing, whether it`s Obama or it`s the Republicans, it`s not putting a dent in the budget because of the giant tax cuts. We keep focusing on the wrong problem. Let me prove it to you without a shadow of a doubt.

The projected deficit in 2011 is $1.6 trillion. The whole non-defense discretionary spending budget in 2010 was $477 billion. Do you know what that means? That means that if you took non-defense discretionary spending, OK, all of it, all of it, all of it, wiped it out to zero, that`s it, we cut everything outside of defense, you would still have a deficit that was over $1.1 trillion. You can`t cut your way to doing this. It`s so obvious.

Back in the 1970s, cynics would say of former Alabama Governor George C. Wallace (now deceased): well, at least he was honest about hating black people. Actually, he wasn't; during the period in which he displayed a notable distaste for blacks, he did not admit to racial prejudice. But his statements and actions were obvious, and obviously not meant to cover up racial animus. And so it is with the GOP and the debt; they won't explicitly tell us they don't care about it and won't own up to it but are not reluctant to make it evident. Unfortunately, unlike the last century's mainstream media, which had no compunction about shining the light upon George Wallace as a symbol of racial prejudice, this mainstream media is obsessed with an approach it believes is fair and balanced, but fails the fair and accurate test.

It is, therefore, up to the relatively tiny liberal wing of today's media to make it plain and simple. Whether a Republican or a Democrat, you cannot vote for a massive tax cut one month and claim two months later a religious devotion to cutting the deficit. That is, unless you want to endure the indignity of the mainstream media acclaiming you a "budget hawk."

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