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If Tax Cuts Pay for Themselves, Why Worry?

By John Martin - Posted on 01 December 2011

Now that Republican leaders agree that we shouldn't raise payroll taxes at the end of the month, everyone's now worried about how we're going to pay for them. Democrats have proposed a surtax on those earning over a million dollars a year. Reported Republican plans include adding three more years to the current 2-year federal pay freeze.

But here's a question-- if Republicans insist that tax cuts are always good for the economy and always pay for themselves through the inevitable economic growth that will result once people have more money to spend and invest, why do we have to "pay" for this continued tax break at all? This point was recently made by former congressman Joe Scarborough. Noting that Senate Majority Leader Mitch McConnell was unwilling to increase taxes on working Americans unless congress could found savings elsewhere, Scarborough points out:
“Mitch McConnell... would appear to be the first Republican in the history of Washington D.C. to say they don’t want a tax cut unless it is ‘paid for,’ because we Republicans generally believe that tax cuts pay for themselves. The economy grows; daisies bloom in the backyard; male-pattern baldness is reversed.”
My interpretation of what McConnell and Republicans like him believe is "We support tax cuts for the wealthy NO MATTER WHAT. Although we support tax cuts for everyone else in theory, in practice it has to be under the right circumstances."
Now that we've broken the ice on this whole "are tax cuts always good for the economy" debate, the floodgates seem to be opening. Today, John Boehner was asked whether he thought raising payroll taxes would hurt the economy. His answer? "I'm not an economist."
Since when are Republicans unsure of whether tax cuts are good or bad? I never thought I would see the day when these guys would stop believing that all tax cuts were cure-alls to every national ailment.

 As Maureen Dowd (NYTimes) points out this new GOP is very comfortable w/ double standards, hypocrisy, and unvarnished self-serving duplicity.  They RUN on it and their supporters are all good w/ it --  neither offended nor shocked. 

Republicans on the Hill just met with that "random guy" Norquist and he told them it was ok to vote against the payroll tax. He would not count it against them in their pledge. So does Norquist insist on no tax increases for anyone or just for the richest among us? What a role reversal. President Obama can say: "Merry Christmas! The Republicans just raised your taxes by about $1000 because they wanted to protect the rich from a little bitty tax increase. Call to thank them or send them a Holiday card to show your appreciation!" President Obama is threatening to keep Congress together for the Holidays of this is not settled. Good for him! The idea of working Holiday time seemed to help when the threat was out there last year. Let's see if it works this time.

The spin doctors have so distorted this issue, they all sound like idiots.  The 3.25% surcharge on those 234,415 who earned over $1 million would raise   $16 billiion,  The cost of the payroll tax extenstion $160.0 billion.   Even worse the $160.0 billion short fall in Social Security contributions would happen the first year.  This issue could have easily been resovled in the super committee but the Dems decided to campaign instead. Its infuriating that media doesnt do a minute's research before reading from Obama's pr sheets. The complete incompetence of the Repubs to explain their proposal to eliminate deductions to increase revenues rather than changing the marginal rates is pathetic.  Both parities agree the tax code must be reformed to eliminate 70 years of special interest deductions, but instead they get the country arguing over a $16 bilioin surcharge on milionares and a $300 million tax on corporate jet owners.   The next lunatic that claims $1 of unemployment benefits adds $1.84 to GDP must be chanenged to a duel at dawn.  Am I the only one questioning why they didn't begin the super committee negotiations with the Obama/Boehner grand bargain that was only a few hundred billion short on the tax side??  The economic benefit from reducing the debt by $4 trillion far outweighs any negative from a $1 trillion tax increase.   The American people would have forced that deal through if the Dems ever showed their cards.


Boehner will go down as the worst house leader in history for turning his back on the grand bargain President Obama was offering during the debt ceiling hostage drama. Although I think Boehner really wanted to embrace it, the moment revealed that he is not really in charge. Norquist-who is not even an elected representative-is in charge and all his little puppets are so faithfully in line with those ridiculous pledges they made it clear that Boehner had no power to convince enough of them to vote for it. The proposal had 2 problems that Boehner could not overcome: 1) President Obama proposed it and the general rule since he's been elected is "be against anything he proposes even if we once supported it or it will help the American people and our economy" 2) It required the rich to pay a little more/involved tax revenue (even though it was still not "balanced" since it had more pain to the poor and middle class.) If Boehner was a good leader and there weren't so many extreme tea party-types in Congress, that grand bargain could have been reality and Congress could be focused more on jobs right now. Even though there were many painful things in that grand bargain hard to sell to the Democratic base, I am convinced President Obama would have had the leadership ability to bring most Democrats on board if Boehner agreed to put real revenue on the table. But Boehner is just too weak. So don't blame President Obama for a Supercommittee which was doomed to fail. Don't blame the Democrats on the committee who angered their base by putting some precious things on the table. Blame only the Republicans who-in the end-refused to include real revenue. They even had a proposal that required Democrats to agree to permanent extension of the Bush tax cuts! That would have put us MORE in debt and I thought the job of the committee was to reduce the deficit! The Republicans are a joke right now (and yes that's my party-but I refuse to support them in their current state of chaos.) No wonder Boehner's Congress stands at 9% approval-the lowest ever! We need to vote the extremists out and maybe Washingon can get some work done for the good of the whole country, not just the 1%. Due to the triggers in the Supercommittee deal, President Obama will ensure that the goal of the Supercommittee is met in terms of deficit reduction. Since both sides failed, both will face uncomfortabable cuts unless they can come together and compromise. Republicans are already trying to change the rules they agreed to to avoid defense cuts but thankfully President Obama is promising a veto and told them "there will be no easy off ramps." Good for him-at least one leader actually cares about the debt. Too bad it had to come to this. If Republicans really care about defense cuts, they can put real revenue on the table and get back to sincere negotiating of a balanced deal.

I am so happy that  our economy is showing some signs of growth!!!------- When the President  initially took office, the economy was contracting and heading for a depression ( Hemorrhaging On life support) !!----The GDP was in a negative but now the GDP is in a positive and the major bleeding has stopped!!   The car sales Industry is up; people are purchasing cars again. The consumer buying/ spending is up.; this Holiday spending has been the highest in a while!!  Christmas spending looks to be on the rise this year!!   The employment rate has shown some improvement  with the unemployment rate at  8.6% despite the 300,000 who have stopped looking for employment!! -----

My question to the opposition regarding the 300,000 people who have stopped looking for employment; weren't these the same  300,000 people still in stagnant mode or dropped out when the unemployment rate was at 9%????--- these people did not just drop out when the unemployment rate dropped to 8.6%, they were  already out of the system even when the unemployment job rate was at 9%!!! ---so why is it that the naysayers are gaging the unemployment rate by the people who have already given up and been unemployed for awhile instead of by the new jobs that are on the rise as the economy recovers????-- I believe this statement about the 300,000 who have stopped looking for jobs were planned by the naysayers just to trivialize and minimize the growth that are taking place now!! ----the naysayers  did not expect to see growth from month to month on the jobs.

I am not implying that we should not be concerned about the 300,000 who are unemployed or given up ( BECAUSE WE SHOULD  CARE!!),  but what I am saying is this should not be the only benchmark to say or measure how the unemployment  rate is not improving; this is a very narrow way to view the growth of the job market!!----- Instead of looking at the patterns and trends of the growth of the job market or unemployment rate from month to month, the naysayers have chosen to continue to weigh in on those who have been out of the system for a couple of years now. Hopefully, as the economy improves, we will see  a real movement and a reengagement of the 300, 000 people who have are unemployed!!


The Stock markets made some serious gains on the announcement that the unemployment  rate has dropped !!  ---At least the stocks have confidence in the market even thou the naysayers keep predicting DOOM and GLOOM!!!--- The naysayers  know that the markets are driven by the reports of the EXPERTS! --- I guess the naysayers realizes that the market is listening to the media and the naysayers are good at predicting and consistently talking Doom and Gloom ; therefore,  the American people stay in perpetual fear and the markets stay in a constant state of instability!!!


If the opponents can't continue to convince the American people to remain  fearful that President Obama is a terrorist, hate America, Not born in America and etc, then they will say lets attack his leadership ability,  we can scare the American people into believing that the economy is failing even thou  a lot of signs are showing real improvement!! --- they will say let's attack his foreign policy by saying the relationship with our allies are fractured each time there are areas of disagreement between alliances!!!--- Each time the President asserts himself and set limits on what he is going to tolerate, the naysayers say that he is demonstrating authoritarian leadership style despite his past history of showing democracy and bipartisanism!!! ---

The naysayers are constantly  trying to create this fear factor that does not exist with the President. I do not believe that the President's  cabinet ( people who he appointed)   is following him blindly and will allow him to have his way without question or restraint. The people who he has chosen to work in his cabinet are intelligent and capable people who are able to advise  him well. When the naysayers' fixation and obsession are so focused on the President  as a failed leader, then everyone in his cabinet should come into question for guiding the President in a very misguided direction ( Which is not true!!!). 

Sadly, the naysayers have such fixation and addiction on the president; they seem to not be able to get him out of their minds, They are talking about him 24/7!! hahahaha!! 

"Republicans link Keystone pipeline to payroll tax cut legislation"

"Republicans in the House of Representatives said on Friday they will attach a bill designed to speed approval of the Keystone pipeline to payroll tax cut legislation House Speaker John Boehner hopes to pass this month."

This is NOT horrible news.In many ways it is good news.

First: it is a way to get Republicans to vote for an extension of the payroll tax cut despite Grover Norquist's blessings that he won't object if Republicans slap this tax on the Middle class. This is as close to a repudiation of Norquist as Repubs are likely to make. They are DESPERATE to separate themselves from him and still survive; Democrats should help them do that and take this deal if it stays within these parameters.

Second: this is almost normal politics -- the House won the 2010 election and the majority party gets a gimme in exchange for doing something the President wants.  It is a more or less normal deal especially in the current climate.

Third. Of all the demands Republicans could have made against Democrats (i.e., sinking the budget and the economy again, although they still might, or slashing medicare or SS benefits), this is a relatively safe gimme for Democrats: the 2012 election is NOT going to hinge on the Keystone pipeline as will damm few congressional seats. This is way down on the right wing's shopping list. Give up on the pipeline, Santa.

Fourth ( I am going to get some heat for this one). Outside of the issue of climate change/global warming (thank Al Gore for this, seriously) the  green/environmental wing of the Democratic party is the least articulate, most knee-jerk, narrowly focused activist faction in their tent.  Their reflexive opposition to developing new fossil fuels and absence of any clear useful agenda for fuel conservation, job protection, and numerous other considerations relevant to the oil/environmental issue have made them a marginal voice for years.  Yes, there will be some scathing headlines, gnashing of teeth, and scolding editorials, but politically this deal is totally affordable and worth doing for Obama.

I hope Boehner can work this one up. If so, I hope Obama and his spokesfolk make appropriate handwringing gestures about the cost to our environement -- and then SIGN the deal. 




Tom-Strange, but that backbone you've been looking for seems to be appearing...ironically in the area you encouraged Pres. Obama to compromise on. I do think President Obama-in the end-will approve the pipeline. But he simply does not want a rush job without examining safety issues. What's wrong with taking our time? Based on some pretty horrid disasters in recent history (which people seem to want to forget) which coud be blamed on poor planning and safety measures, it seems pretty wise to me. Here's what I read from The Hill: "Obama warned that he would veto an extension of the payroll-tax cut, his top legislative priority, if House Republicans link it to a measure that would force the administration to greenlight the pipeline project. "

That's true, Kelly. It has been a rare day when he has been more hard line than I thought he would be.  But, hey, if it works out for him and he gets an equally good or better result, I am thrilled to be wrong.

The hypocracy of The Republicans in Congress never seems to end ! Just when you think they can't sink any lower they do. And speaker of the house Boehner is an embarassment. The Republicans dare not upset the big business corporations that they really work for...and have them pay their fare share of taxes to help the middle class Americans. But tax cuts for the Wealty...always.

When I look at President Obama’s press conferences, I am always struck by the tone and defiance of the reporter’s questions regarding President Obama’s engagement and involvement in the negotiating process with congress on the extended payroll tax and unemployment compensation. The implication seems to be that the President is supposed to be involved in every step of the process and that he is somehow responsible for persuading grown adults to agree with his ideas; also, it is implied that if the President insists or demands that congress acts responsibly then he is beating up on the poor Republicans in congress!!---

The reporters fail to acknowledge his track record of bipartisanship and to understand that the President has a right to set boundaries and limits on how he is going to continue to allow congress’s obstruction of justice for the American people & their refusal to negotiate with the President. However, the reporters will not Grill Congress as to why they find 99% of the President’s Proposals for the American people unfavorable.


Congress is not answering the American people directly but the President has to speak on their behalf because they are cowards and too afraid to answer to the public like the President does.  Maybe if congress has to answer the reporters in press conference for 30 minutes to an hour as to why they find most of the President’s proposals unsatisfactory then possibly that will put them in the forefront to answer for themselves instead of the President always having to answer for Congress’s behavior.

When Congress has to oppose 99% of the President’s proposals, appointments and any other issues related to this administration then there is a SERIOUS PROBLEM! and they should want to come forward to the American People and give their perspective ; instead, they take the weakling route and evade the public which means these arrogant obstructionists does not have to answer to the American people! They should be put on the spot and GRILLED in front of the American people just like the president for extended periods of time on their policies, But NOOO these timid weak obstructionists are given a free ride to do what they want without having to answer to their constituents.


Each day the President steps forward and discusses his insistence on a policy that works for the American people; he lays out his vision plain and clear and talks about the direction that he wants to take the Country that will benefit and prosper the American People overall. All of his policies are based on researched data from experts, agreement from the general public and members from both parties even those who are no longer in the administration! The Republicans in Congress refuse to acknowledge this data and take action based on the large support from the public, small businesses and the experts. There is no convincing people who have been in public office  ( white house) for 20 years that their actions are toxic and it is time for them to leave the white house when they are in complete opposition to what their constituents desire, the facts that the experts presented, and the vision of the President.


I hope this administration continues to expose the actions of these congressmen even if they cry victim and claim that the President is beating up on them!!--- These congressmen can say all types of bold things about the President to Fox news and their cronies but they are too afraid to stand up to the American people!! The President goes to the American people (Republican and Democratic communities; BTW Which no other President has done before!!) and speaks directly to the people and even deals with their frustrations and takes ownership for the brokenness in the administration but these weak Congressmen hide behind their cloak of righteousness and irreproachableness.


I am looking for the day when this administration will roll all the policies, collaborations with Global leaders,  effective foreign policy management with the middle east, trade policy deals,  historical proposals that were passed into law, collaborations with small businesses, development of the infrastructure, women’s rights, gay rights, support for Israel, Native Americans, Hispanics, Muslim communities, and his unprecedented appointments of a vast diverse administration that reflects the diversity of the nation!! – Along with keeping the Obstructionist to the forefront no matter how they cry wolf!!

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