Republican Tax Scam Is Either Evil Or Dumb, Maybe Both!
Interesting article in the Washington Post by James Hohmann, Breanne Deppisch and Joanie Greve: "Tension over adding 'triggers' to the tax bill highlights the Republican identity crisis over deficits".
I have to explain this to you because it is so nonsensical, and the media is doing an absolutely terrible job of even describing - much less explaining - what Bob Corker is up to. And yet you need to understand this because it exposes the Republican tax scam brilliantly and Corker doesn't even realize it.
So, first of all, let's step back and just set aside for a moment the whole Republican tax scam and just talk for a second about macroeconomic policy during times of boom and bust, okay, the large economic policies of a nation as that nation goes through the regular cycles the capitalism brings us, typically a six, seven, eight year cycle of boom and bust.
You have booms and then you have bust and then boom and then bust and then roughly every 80 years that cycle goes totally insane and becomes insanely toxic and you have a huge bust after a huge boom.
So typically the conventional wisdom - and it's conventional wisdom because it's been demonstrated to work over literally hundreds and hundreds of years - is that when the economy is really doing well, when you've got unemployment below five percent, which is right now, when you've got corporate profits at an all-time historic high, higher than ever in the history of the world, which is now, when you've got rich people making more money than rich people have ever made before in the history of Earth, which is now, when you've got those conditions - corporations are awash in cash, money is easy to borrow, any company that wants to expand can easily do it, you can float a bond, you can do an IPO, there is a ton of money floating around.
During those times that is when you raise taxes in order to accomplish the things that government should accomplish.
We have bridges that are falling apart. We have water supplies that are contaminated with lead. We've got an electric grid that's 150 years old - or more than a hundred years old in many parts of the United States - that needs to be replaced with solar and renewable and wind power and smart grids and flexible grids and resilient grids.
All of these kinds of infrastructure: our highways are filled with potholes, our airports are crumbling, and our internet infrastructure - as I experienced this week.
Our internet infrastructure is crappy because it's all mostly all in the hands of for-profit corporations that are more interested in squeezing profits out than providing customer service or expanding capabilities. So that's what's going on.
So what you do when the economy is really good is you raise taxes and you make those investments because those investments will return a profit.
For every dollar that we spent on the GI Bill back in the 1940s and 50s sending mostly young men to college who had been in World War Two we got $7 back in additional taxes.
For every dollar that Dwight Eisenhower spent on the national interstate highway system, depending on the study you look at, we made between a hundred and thousand dollars in additional taxes.
Infrastructure pays back and it will pay back during those times when the economy is sliding.
When you do tax cuts in order to stimulate an economy you do that when the economy is in a recession as President Obama did in 2009. The stimulus Act of 2009, which included some tax cuts, principally rolled back by one percentage point the social security tax deduction for a year. So there was an actual reduction of taxes for low-income people across the United States.
And when that happens, that stimulates the economy and we saw it in real time. We watched as we went from losing 700,000 jobs a month to creating several hundred thousand jobs a month for the next seven years as a result of that stimulus.
So the Republicans are doing this completely ass-backwards.
But then Corker comes along and says, "okay, I'm concerned that this is going to cost more than one and a half trillion dollars, this might blow up the deficit more than one and a half trillion dollars." He's willing to add a trillion and a half to the deficit, apparently. "And so we're going to put an automatic trigger in that will raise taxes when tax revenues drop."
Well, when do tax revenues drop? When you're in a recession!
So Bob Corker just said, let's put into law that when we hit a recession, which is the time you should be cutting taxes, we're going to raise taxes, which will make the recession worse.
These guys are idiots!