GOP Tax Cut Fraud: ‘It’ll Pay For Itself’
Reprinted with permission from AlterNet.
Remember the Republicans’ claim that their tax scam slashing rates for the rich and corporations would magically pay for itself?
Here is how that works: a rich guy walks into a Mercedes-Benz dealership, gets behind the wheel of a $112,400 GP Coupe, and drives away yelling to the salesman, “Don’t worry. It’ll pay for itself.”
It’s nothing but a fraud.
Well, that’s what the nonpartisan Congressional Budget Office (CBO) said this week, anyway. Without blatantly labeling the GOP tax cut as a con, the CBO did say that it would in no way, not ever pay for itself. It would, the CBO warned, dramatically raise the national budget deficit, year after year, for at least a decade.
Republicans, the party of public hand-wringing over deficits, deliberately created this gob-smackingly huge one. Privately, Republicans are the party of glee over deficits. That’s because they use them as an excuse to slash and burn programs cherished by the vast majority of Americans such as Social Security, Medicare and Medicaid. Yes, Grandma, that tax cut Republicans gave to fat cats means you’ll be eating cat food.
The CBO said Monday that the budget deficit this year will be $804 billion, which is $139 billion more than the agency had projected the shortfall would be before the Republican-controlled Congress passed the tax cut for the rich and a massively out-of-balance budget.
The GOP tax bill, the CBO said, would continue not paying for itself by larger and larger amounts, increasing the deficit to nearly $1 trillion next year and more than $1 trillion in 2020.
The CBO also projected that the reduced tax income and increased deficit spending would raise interest rates. Higher rates hurt everyone trying to buy a home or pay down credit card debt. They’re also bad for the federal government.
Because of the higher rates, the CBO says that by 2023, interest costs on the national debt will exceed what the government spends on the military. By 2028, those payments will cost more than triple the amount paid last year.
Also, in the case of an economic downturn, high rates and high debt would make it difficult for the government to borrow to pay for an economic stimulus to turn the economy around.
Normally, during times when the economy is healthy and unemployment is low—times like now—the government reduces deficits, in effect, saving for a rainy day.
That’s not what this Republican Congress did. Remember, GOP congressmen, who are employed by the government, hate the government. They want to drown it in a bathtub, as their cult leader Grover Norquist advocates.
David Stockman, who was President Ronald Reagan’s budget director, named the maneuver Republicans use to accomplish this “starve the beast,” with “the beast” being the government. Emaciating the government is simple. Cut taxes paid by the rich, which, of course, reduces government revenues. Then claim the government just doesn’t have enough money to pay for crucial benefits that tens of millions of vulnerable Americans need to survive.
Republicans see it as a win-win. It’s a gift to their wealthy campaign donors and kick in the gut to government services.
It’s exactly what Republicans were doing when they first cut taxes by $1.5 trillionin December then in February passed a $1.3 trillion spending plan that eliminated previous budget caps so that Congress could spend even more money that it doesn’t have over the next two years—in this case, an extra $300 billion.
The scheme is no secret either. GOP House Speaker Paul Ryan announced exactly what he was doing right around the time Republicans gave the rich and corporations all those tax cuts last year. On a radio talk show he said, “We’re going to have to get back next year at entitlement reform, which is how you tackle the debt and the deficit.”
Grandmas, heroin addicts seeking treatment and Tea Partiers with signs warning “Keep Your Goddamn Government Hands Off My Medicare” should be wary. Congressional Republicans are now going to wrap their government hands around Medicare, Medicaid and Social Security and try to squeeze the life out of them.
Paul Ryan got exactly what he wanted and expected from the CBO this week—horrible news, a devastating report that he can wield as a weapon to smash these programs.
Republicans knew tax cuts for the rich (including 15 wealthy Republicans on tax-writing committees who will each get a tax windfall averaging $314,000) would not “pay for themselves.” They always intended to make the elderly, the poor and the ill pay for them.
He did his part to further enrich the already rich, bankrupt the American government, and push the nation’s elderly and vulnerable closer to the brink.
Before he bows out, he’s going to try to make matters worse. He wants the House to vote on an amendment to the Constitution requiring a balanced budget. If such an amendment were in place now, it would require Congress to find an extra $804 billion this year to eliminate the deficit Republicans deliberately created. The first place the GOP would go looking for that money is the Medicaid, Medicare and Social Security funds.
Unlike legislation, though, a proposed amendment to the Constitution must be passed by two-thirds of the House and Senate before it can move on to consideration by state legislatures. So Paul Ryan’s new attempt to force Congress to kill social welfare programs will fail.
And it should.
When they run for office, Republicans should flat out tell their constituents, who have paid into the Social Security and Medicare funds all of their lives, that the GOP will do whatever it takes to incinerate the nation’s social safety net.
Republicans know, however, that would mean voters would put an end to GOP lawmakers’ government-paid gravy train. And while they are willing to take the food out of the mouths of the nation’s elderly, they’re not willing to relinquish their own free lunches.