E.J. Dionne: 'Tax Cuts Add to the Deficit No Less Than Spending Increases Do'
What kind of an idiot must you be to believe that tax cuts have an equal dollar for dollar negative impact on a government budget as spending increases do?
The most obvious answer given the charge of this website is a liberal media member, and the Washington Post's E.J. Dionne nicely proved this point with his column Monday:
As for the House Republicans' plan to gut pay-as-you-go budget rules by not requiring offsets for tax cuts, it's ridiculous by the ordinary rules of mathematics. Tax cuts add to the deficit no less than spending increases do.
Really, E.J.? For that to be true, wouldn't absolutely no positive economic impact have to come from such a tax cut?
If tax cuts have no stimulative value whatsoever - zero, zip, zilch! - why did President Obama and former President Bill Clinton tell the nation less than a month ago it would be castrophic for the economy to allow the Bush tax cuts to expire?
I guess E.J. forgot that.
Economists on the left and the right have debated for decades what the net revenue result is from tax cuts.
Conservative analysts cite the explosion in tax receipts during the Reagan era as evidence tax cuts stimulate the economy to such an extent that federal coffers grow at a much faster rate than if rates had been left unchanged.
Income tax receipts also grew much faster in the latter part of the '90s following the Gingrich tax cuts than they did after Clinton's tax hikes in the early part of that decade. The same was true in the '00s when receipts exploded nicely after the Bush cuts were enacted up until the financial crisis in 2008.
Not convinced of this is former Federal Reserve chairman Alan Greenspan who has said on numerous occasions that tax cuts have some net negative impact to the budget, although to the best of my knowledge he's never quantified the associated percentage reduction.
However, for tax cuts to result in a dollar for dollar decline in receipts necessitates absolutely zero positive stimulation to the economy as a result of said cuts, and there is no recent history of such a thing occurring.
But what should we expect from a so-called journalist that on the one hand writes, "Like it or not, Republicans won the House in last year's election" while moments later quoting the perilously liberal historian Gordon Wood to bash the Tea Party:
From its inception, the Tea Party movement has treated the nation's great founding document not as the collection of shrewd political compromises that it is but as the equivalent of sacred scripture.
Yet as Gordon Wood, the widely admired historian of the Revolutionary era has noted, we "can recognize the extraordinary character of the Founding Fathers while also knowing that those 18th-century political leaders were not outside history. . . . They were as enmeshed in historical circumstances as we are, they had no special divine insight into politics, and their thinking was certainly not free of passion, ignorance, and foolishness."
An examination of the Constitution that views it as something other than the books of Genesis or Leviticus would be good for the country.
For those unfamiliar with Wood, the conservative think tank the Claremont Institute's Steven Hayward depicted him quite accurately in 2007:
Gordon Wood is the favorite historian of America's liberal establishment. His essays appear regularly in the New York Review of Books and the New Republic, and liberalism's leading intellectuals—from Michael Sandel to Morton Horwitz to Bruce Ackerman to Cass Sunstein—regularly cite him with approbation. What virtues do they see in his work? In Wood's books, particularly his Creation of the American Republic, 1776-1787, they see a hammer with which to bash American individualism and capitalism, and to support an ever-growing administrative state.
Any surprise that Dionne finds Wood's views important and has no clue of the stimulative nature of tax cuts?
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Comments
So EJ
Submitted by donabernathy on Mon, 01/03/2011 - 11:07am.
the GubRmint steal'n less of our money..... leads to them spending more of our money???
The deficit is our fault!!!!!!!
roflmao
Really? Does it seem to
Submitted by johnsonl on Mon, 01/03/2011 - 11:17am.
Really? Does it seem to anyone else that these liberal MSM idiots are just throwing any old lie out there, just to see if they can run with it? Do they really think we're that stupid? Do they wonder why their TV shows, magazines and newspapers are circling the drain, while conservative outlets are flourishing? Joseph Goebbels was wrong, you know; the American people do not believe the liberal MSM anymore. Their credibility is gone, just like their viewers and subscribers.
The country v. the government
Submitted by KC Mulville on Mon, 01/03/2011 - 11:23am.
Which is more important, the public or private sector? Obviously, the public and private sector depend on each other, but EJ Dionne's concern is strictly about government. Dionne pays no attention to the effect that taxes have on the country as a whole, that's why he sees no difference between a tax cut and a spending increase.
I'm amazed at how often these pundits are willing to steal from the whole country to pay for their preferred political spending. They treat the country as if we serve the government, instead of the other way 'round. They've got the cart before the horse. Government exists to serve, not to be served. As I understand it, the general percentage is that the private sector is 80% of the whole economy. Why would we frustrate and slow down 80% of the economy to sustain the indulgence of the 20%?
Answer: because the 20% has power, and media flacks like Dionne obsequiously flatter power.
Quick Answer, NS
Submitted by Blonde on Mon, 01/03/2011 - 11:36am.
What kind of an idiot must you be to believe that tax cuts have an equal dollar for dollar negative impact on a government budget as spending increases do?
A liberal democrat tax & spend-loving idiot.
But you knew that.
Handy Reference Guide to Obama's Gaffes and Goofs ~ Currently Numbering 200 (and Counting)
Dionne envisions the rich as
Submitted by Hunter12 on Mon, 01/03/2011 - 11:37am.
Dionne envisions the rich as a bunch of Scrooge McDucks, with their swimming pools full of money and jewels into which they take daily plunges. People are sitting on their money a little more today than they were during the Bush years, but they're waiting to see how much of it the government is going to let them keep before they put it back to work. Repeal Obamacare and make the tax cuts permanent and watch those rates go back to 2%. We don't have to look too far to see how inefficient Uncle Sam is at spending money. Most of it goes to cronies, who then kick part of what they get back to the politician passing it out.
"An appeaser is one who feeds a crocodile, hoping it will eat him last." - Sir Winston Churchill
Earth to Ignorant Socialists
Submitted by JustAl on Mon, 01/03/2011 - 11:40am.
There haven't been any tax cuts for years.
There was a deficit when the last tax cut took place.
State and local taxes have increased (along with state and local deficits).
Cover yourselves, your stupidity is showing.
Given the enormity of our national debt . . .
Submitted by Galvanic on Mon, 01/03/2011 - 12:27pm.
. . . only tax cuts teamed with spending reductions can even begin to turn things around.
Tax cuts can result in increased Federal tax revenue as it did with the JFK tax cut, but the Congress has demonstrated so little fiscal discipline that they treat the increase as some sort of windfall to be piddled away on pork.
The GOP admits now that it was fiscally irresponsible during the Bush years, and begs forgiveness. The voters have returned them to control of the House.
Has the GOP leadership learned its lesson? I doubt it, as Mitch McConnell was willing to suspend the earmarking practice for just two years instead of banning it for good.
We'll see.
It only makes sense from one perspective...
Submitted by c5then on Mon, 01/03/2011 - 11:42am.
If you start with the marxist premise that all money belongs to the government. That is the only way that saying tax cuts add to the deficit makes any sense at all. Of course about 75% of the public in this country will reject that idea. The remaining 25% seem to be in the Democrat party and in the media.
A deficit is defined as spending more than you take in. If you take in less and you spend even less than that, you can still have a surplus.
Madison and Jefferson and Franklin built a Republic - Roberts killed it!
The Constitution is a
Submitted by ant on Mon, 01/03/2011 - 11:46am.
The Constitution is a collection of shrewd political compromises? Who were they compromising with? LaRaza? The automakers union? King George?
If the left is so astute when it comes to economics let us employ Nancy Pelosi's theory and soon we'll be swimming in prosperity. Food stamps and un-employment checks for everyone!
EJ Dionne
Submitted by rpeeler42 on Mon, 01/03/2011 - 11:56am.
Dionne's column runs in our paper, so I get to read his idiotic comments and ideas way too frequently Our local paper is a closet liberal group that secretly supports liberal idiology while trying to portray a middle of the road posture,
PBS has Donne on its programs on a regular basis, which I suppose is to be expected for a socialist broadcasting company. The left wing appears to be against all of the principles that made this country great. I wish they would all emigrate to the socialist country of their choice.
No surprise here
Submitted by stunned on Mon, 01/03/2011 - 12:12pm.
Liberals will ever ever admit that tax cuts bring in more revenue to the government. If Obama had spent his trillion dollar stimulus money by cutting corporate taxes back in 09 millions of jobs would have been saved, morgage defaults by the millions would have been avoided, property values stabilized, revenues would have been up, poverty would not be at record levels not seen in nearly two decades and the Dems would still control the House. But then there would not have been the need for the big Liberal programs designed to make folks more dependent on the Federal government and move even more power to the power mad Democrats and bureaucracies in D.C.
tired of liberal lies
Can't we settle this argument for all time?
Submitted by Red Jeep on Mon, 01/03/2011 - 12:23pm.
Why do we have to relive the stupidity of high taxes are good every time the Dems are in power?
That's why we got to get these gerrymandered liberal lifers out of office by term limits or mandatory retirement requirements.
Seems like it might occur to the Libs that if they cut taxes and spending and got the government in a surplus position they might get away with funding some of their pet projects.
Jeep, I'm with you on
Submitted by motherbelt on Mon, 01/03/2011 - 12:50pm.
Jeep, I'm with you on that!
I keep saying if we can't have term limits, we at least need mandatory retirement at 65!
It's ridiculous that we have guys in their 80's who have never done anything else but be congressmen or senators!
Framing the Constitution had
Submitted by Edhenry on Mon, 01/03/2011 - 12:23pm.
Framing the Constitution had much discussion and debate, but on the principles that were/are the most radical in the history of mankind, there was very little compromise.
It was the boldest stroke of independent thought to govern a nation in all of history.
Still is
EJ Dionne
Submitted by HockeyKid on Mon, 01/03/2011 - 12:41pm.
is a dim bulb among dim bulbs, and Gordon Wood hasn't demonstrated sufficient illumination to pass himself off as a compact fluorescent with a bad ballast.
Here it is in a nutshell, EJ Dumbone: If a 10% decrease in tax rates causes a 15% increase in GDP due to additional money available for investment, then tax revenues go UP and the deficit goes DOWN. This is a far cry from the 1:1 impact that increased spending has on the deficit. It's so simple even you might understand it if you stop and THINK for an hour or two.
Gordon Woodforbrains, you should be ashamed of yourself. The drivel you write in the name of history should only be sold in the "historical fiction" section. To imply that there is nothing exceptional about the historical perspective of the Founding Fathers is to be myopic (or purposefully misleading) in the extreme. For either reason, you are a failure.
"Beauty is only skin deep, but liberal's to the bone." - me
Taxation
Submitted by scottyusmc on Mon, 01/03/2011 - 1:05pm.
You all have to remember that Tax Cuts are opposed because they encourage freedom and individual responsibility. Tax Increases encourage control and reliance on the government to provide. The liberal definition of Taxation is not as a means to fund the government; but as a means to gain control over the population.
It doesn't imply that..
Submitted by yutsnark on Mon, 01/03/2011 - 5:19pm.
It doesn't imply that tax cuts have no stimulative effect. It implies that tax cuts have about the same stimulative effect as spending increases.
So what is 2011 gonna be?
Submitted by bassndude on Mon, 01/03/2011 - 1:19pm.
So what is 2011 gonna be? Year of stupid statements? Do these people really think we are as stupid as they are? Ignorant Wilderbeasts wandering the savana looking for Crocs in the grass and Lions in the rivers? Do they really think we belive that nonsence?
Save a SeAL, club a liberal/troll!!
Democrats do not mind any tax
Submitted by phryingphish on Mon, 01/03/2011 - 4:40pm.
Democrats do not mind any tax cut, as long as they get to spend the money anyway.