Thursday, December 22, 2011

The Republican Big Lie….

And How It Can Trip Them Up Now

Ken O’Brien

The current Washington soap opera relates to the extension of payroll tax cuts that would benefit the vast majority of Americans in the middle class.

The core issue is the manner in which we would pay for this tax holiday.

Democrats have proposed a surtax on those earning in excess of $1 million per year

Republicans initially proposed further spending cuts. Now, in the absurd compromise for a two month extension, the proposal is to have a surcharge on mortgage fees for Freddie Mac and Fannie Mae mortgages.

However, it is acknowledged that such a “pay for” would be insufficient for a full year extension.
So, come January, the battle will be joined again on the issue of how to pay for these payroll tax cuts.

While the consensus is that Republicans have been getting their asses kicked on the politics of this issue, the Democrats have fallen into a far more serious trap.

In the debates on this matter, Democrats have implicitly accepted the premise that such cuts have to be paid for.

For thirty years Republicans have argued that tax cuts pay for themselves. Because they stimulate the economy, they return more in revenues than they cost. This belief was founded in the spurious logic of the aptly named “Laffer Curve”.

Yet, despite thirty years of this virtually religious belief among Republicans, Democrats are accepting the GOP’s argument that tax cuts for the middle class must be offset either by spending cuts or other sources of revenue.

Why are Democrats foregoing the obvious opportunity to challenge Republicans to adhere to the core tenet of their neo-conservative orthodoxy?

Grover Norquist, founder of Americans for Tax Reform, has issued a pledge signed by most Republican members of the House and Senate. On their website, Americans for Tax Reform describe the implications the pledge in simple terms:

“The pledge commits a member to oppose and vote against any effort to raise the federal income tax on individuals or corporations. The pledge does not stand in the way of any tax decreases or revenue neutral changes to the income tax.”

It is time for Democrats to call out Republicans for the inherent hypocrisy, failure and damage of their of their policies and their underlying bankrupt philosophy.

All that it has led to for the vast majority of Americans can be distilled into the following graphic.

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