How Can Anyone Take The GOP Seriously: The Dismal Republican Record On Taxes
“In the present weak economic climate,” a group of conservatives, including Newt Gingrich, wrote in an open statement, “we believe that to restore the health of the economy and put Americans back to work, America should follow a course against high taxes and federal spending.”
The White House was unmoved. “Republicans may feel they can’t go to voters after supporting a tax increase,” one administration official told the New York Times. “We’ve got to convince them that the situation won’t be as devastating as it would be if the tax bill is sabotaged.”
The latest moves in the debt ceiling debate? Not quite: The administration was Ronald Reagan’s, and the year was 1982. With his previous year’s landmark tax cuts having exploded the budget deficit, Reagan had reluctantly backed a tax increase to bring it back under control, prompting a minor conservative uprising led by then Rep. Jack Kemp and which included then backbench House member Gingrich. “You can’t have the largest tax cut in history and then turn around and have the largest tax increase in history,” one conservative rebel groused.
Right-wing economists issued dire forecasts. Arthur Laffer, widely described as the father of supply-side economics, warned that the bill would “stifle economic recovery” and “lengthen and deepen the recession.” The president of the U.S. Chamber of Commerce wrote that the tax hike would “curb the economic recovery everyone wants,” adding: “It will mean a lower cash flow as more businesses pay more taxes, with a depressing effect on stock prices. It will reduce incentives for the increased savings and investment so badly needed to improve productivity and create more jobs.” As Bruce Bartlett, an early supply-sider and Reagan aide who has since recanted the faith, noted last month, “It would be hard to find an economic forecast that was more wrong in every respect.” Real gross domestic product grew at 4.5 percent in 1983 and 7.2 percent in 1984, while unemployment fell from 10.6 percent in December 1982 to 7.1 percent in 1984.
Just about the only thing the conservative rebels got right back in 1982 was Gingrich’s comment to the New York Times that the skirmish was the “opening round of a fight over the soul and future of the Republican Party.” Looking back, the extent to which the conservatives won the fight within the party while losing the war with economic reality is fairly astounding. In the nearly three decades since, the Republican feeling toward tax increases has moved from Reaganesque dislike but acceptance (he signed tax increases into law in seven of his eight years in office) to their current, blindly absolutist position flatly opposing any tax increases at all, even in the face of spiraling deficits and possible economic default.
Witness comments like House Speaker John Boehner’s that “raising taxes is going to destroy jobs.” The rhetoric hasn’t changed much since 1982, but the accumulated evidence against this GOP dogma is overwhelming.
Gingrich was again at the forefront of the fight against taxes in 1993 when he warned that the Clinton budget plan “will in fact kill the current recovery and put us back in a recession.” Rep. Dick Armey, who would go on to be House majority leader and now is a Tea Party godfather, warned that “the impact on job creation is going to be devastating.” Texas GOP Sen. Phil Gramm warned that the budget deal was a “one-way ticket to a recession,” adding that Clinton’s would be one of the jobs killed by the bill. (Gramm would seek Clinton’s job, but couldn’t best Bob Dole; he was last seen being muzzled by John McCain’s presidential campaign in 2008 after calling the country a “nation of whiners.”) Laffer warned that “Clinton’s tax bill will do about as much damage to the U.S. economy as could be feasibly done in the current political environment.” Boehner himself dismissed the Clinton plan as “Christmas in August for liberal Democrats: more taxes, more spending, and bigger government.”
He got the Christmas part right. Unemployment, which had been 7.1 percent in January 1993, fell to 5.4 percent by the end of 1994. Real GDP grew from 2.9 percent in 1993 to 4.1 percent in 1994. The final tally of the Clinton years was 23 million new jobs and a budget surplus.
Clinton and his villainous tax hikes were followed by George W. Bush and his cure-all tax cuts. “Tax relief will create new jobs,” Bush argued in April 2001. “Tax relief will generate new wealth.” When the bill was enacted that June, GOP Rep. Mike Pence (now running for governor of Indiana) gushed that they would “stimulate our economy” and “put the ax to the root of the Internal Revenue Code as it wages war on the American dream.”
How’d that turn out? From 2001 to 2007, jobs grew at one fifth the pace of the 1990s, the slowest rate in the post-World War II era. GDP in those years grew at half the rate of the 1990s. Oh yeah, and the deficit exploded. Fully 10 years after the largest tax cuts in history, the economy had shed 1.1 million jobs. It seems Pence’s ax was put to the root of the American dream itself.
Given the historical and economic record, one has to ask: How can anyone take the GOP seriously, especially when they are playing fast and loose with economic disaster in service to a political philosophy that not even their main icon—Reagan—followed with such monomania?
Decrying the Clinton tax plan in 1993, Boehner recalled the quote: “Those who do not learn from history are doomed to repeat it.” He went on, “It very appropriately applies to Congress today.” That’s one piece of rhetoric Boehner really should recycle. And learn from.
By: Robert Schlesinger, U. S. News and World Report, July 13, 2011
Eric Cantor’s Slick Upper Lip: “I Want What I Want When I Want it”
Eric Cantor has perfected the strategic sneer.
It comes, frequently, when he answers a reporter’s question about something President Obama has said: The House majority leader’s lip curls up on the left side and a look of disgust washes over his face. This week, he has been coupling the sneer with lines such as:
“How in the world can you even accept that notion?”
And, “That is laughable on its face.”
And, “That doesn’t make sense. . . . That again is just nonsensical.”
And, “Come on — let us think about this.”
Cantor, who is establishing himself as the lead GOP negotiator with the White House as the Aug. 2 default deadline approaches, is answering calls for compromise with contempt. He shook his fist during a news conference Tuesday and said that Obama’s thinking is “unfathomable to me.” To Obama’s complaint that the wealthy are not sharing in the budget sacrifice, he scoffed: “There is plenty of so-called shared sacrifice.” Asked about Obama’s belief that people like him should pay more in taxes, Cantor retorts: “You know what? He can write a check any time he wants.”
He draws out the vowels in a style that is part southern, part smarty-pants. Had young Cantor spoken like this at his prep school in Richmond, the bigger boys may well have wiped that sneer off his face. Yet even then, Cantor was accustomed to having things his way. According to Cantor’s hometown Richmond Times-Dispatch, the quotation he chose to accompany his yearbook photo was “I want what I want when I want it.”
What Cantor wants now is power — and he is prepared to risk the full faith and credit of the United States to get it. In a primacy struggle with House Speaker John Boehner, he has done a deft job of aligning himself with Tea Party House members in opposition to any meaningful deal to resolve the debt. If the U.S. government defaults, it will have much to do with Cantor.
He pulled out of debt-limit talks with Vice President Biden. He shot down the outline of a compromise that Boehner attempted to negotiate. Now Cantor has essentially taken over talks with the White House, and he has tamped down any hint of conciliation.
On Monday, Boehner hinted that he could accept a tax-reform deal that brought “additional revenues to the federal government” — and his spokesman confirmed that the proposal would be “scored” by the Congressional Budget Office as increasing tax revenue. But Cantor was having none of it: “We are not raising taxes, so it has to be net revenue neutral.”
Cantor’s aides say he is merely reflecting his caucus. But Cantor, a veteran of a decade in the Capitol, surely knows that he is jettisoning the last chance in the next couple of years to make a serious dent in the national debt. The White House has so far offered up a tantalizing array of concessions — $4 trillion in budget cuts and overhauls of Medicare, Medicaid and Social Security – but Cantor has yet to offer anything but sneers.
He flashed the trademark facial expression even before taking his seat at a Monday news conference. Asked whether he would offer any concessions, Cantor responded by saying that the cuts he demanded from the White House were in fact concessions by him, too. “Nobody relishes the opportunity to go and cut these programs,” said the creator of the YouCut Web site that made budget-cutting into an online game. Cantor further said that it was a concession merely to avoid a government default.
The search for a Cantor concession continued. “In terms of shared sacrifice across the country, do you see that one as necessary?”
Cantor swung his arm over his chair back and raised his upper lip. “I think behind this notion of ‘We want shared sacrifice’ that they continue to say means, ‘We want to raise taxes,’ ” he said.
Claiming that there have been “concessions made already” by his side, Cantor was pressed to name some of them. “I don’t want to get into specifics now,” he said.
Leaving a House Republican caucus meeting Tuesday morning, Cantor approached the microphones, flashed the cameras a good-morning sneer and demanded to know “why in the world” Obama wants to increase taxes.
NBC’s Luke Russert asked what “sacred cows” Cantor would be willing to sacrifice. Cantor repeated his denunciation of Obama’s tax policy.
“Where do the Republicans feel pain here, though?” Russert persisted.
After a long and contemptuous day, the majority leader probably feels it most in his upper lip.
By: Dana Milbank, Opinion Writer, The Washington Post, July 12, 2011
Ruling: No Corporate Donations For Russell Pearce In Arizona Recall Election
Senate President Russell Pearce will not be able to get financial help from corporations to keep him in office, at least not directly.
In a formal legal opinion, state Solicitor General David Cole rejected the contention of Lisa Hauser, an attorney who represents Pearce, that the prohibition on those donations that applies in regular candidate races is inapplicable in recall elections.
Cole said the law is clear that neither corporations nor unions can make contributions designed to “influence an election.’’ And he said a bid to oust a sitting legislator from office fits that definition.
Cole wrote the decision rather than Attorney General Tom Horne, who had recused himself because of his political ties to Pearce.
Under Arizona law, a formal opinion from the Attorney General’s Office can be cited as legal precedent, much like a court ruling. The fact that this opinion was signed by Cole and not Horne does not change that.
Hauser said a campaign committee formed to aid Pearce had accepted a small corporate check — she said it was about $1,200 —but returned it when state Elections Director Amy Bjelland questioned the legality of the move. It was Hauser who then sought the formal opinion.
“If that’s the AG’s opinion, unless we go to court to change it, it is what it is,’’ she said. But Hauser said that is unlikely to happen.
If nothing else, she said, the opinion clarifies that corporate and union money will be off limits not only to Pearce but to anyone who decides to run against him.
“We just want to make sure everybody’s playing by the same set of rules,’’ Hauser said.
But Cole pointed out there is a loophole of sorts in the law.
He noted that the U.S. Supreme Court ruled last year that corporations and unions have some of the same free-speech rights as individuals. While that does not disturb state or federal laws prohibiting contributions directly to candidates, there can be no laws which bar either type of organizations from forming or contributing to separate efforts to elect or defeat any particular candidate.
The only requirement is that these committees be completely independent of — and have no connection of any sort to — the candidate.
Randy Parraz, one of the recall organizers, said his committee has not accepted either corporate or union money. But Parraz will not disclose who paid for the successful petition drive, at least not yet.
“A lot of this has to do with people’s fear,’’ he said, intimating that those who helped with the recall might be the subject of some sort of unspecified retaliation. He said some people gave just $25 because the sources of contributions at that level and below do not need to be detailed.
“We’re going to comply,’’ he said. “We don’t feel compelled to have to disclose at this point.’’
Bjelland confirmed that for this unusual election — the first ever for a statewide or legislative office — the first campaign finance reports do not have to be filed until Oct. 27. That is only two weeks before the vote.
In a separate event Monday, Parraz attempted to deliver a letter to Pearce at his Senate office asking him to resign.
That is one option he has under state recall laws. The Maricopa County Board of Supervisors would then choose a replacement.
But Pearce said he has no intention of quitting and believes he will win the recall and be able to serve out the balance of his two-year term.
By: Howard Fischer, Capitol Media Services, Published in East Valley Tribune.com, July 12, 2011
Ideology Trumps Economics: Republicans’ Refusal To Raise Revenues Is Threatening The Economy With A Chaotic Default
There is a huge gap in logic at the heart of the Republican intransigence on a debt-ceiling deal, and President Obama helped to illuminate it on Monday.
The party claims, as an article of faith, if not evidence, that the government’s growing debt is the reason for persistent unemployment and economic stagnation. And yet Republicans are spurning the president’s compromise offers to reduce that debt by trillions over the next decade because he is sensibly insisting that any deal include some increase in tax revenue.
“Where are they?” Mr. Obama asked at his news conference. “I mean, this is what they claim would be the single biggest boost to business certainty and confidence. So what’s the holdup?”
The holdup, of course, is that Republicans are far more committed to the ideological goals of cutting government and taxes than they are committed to cutting the deficit. They rejected several compromise offers by the White House, even though any revenue increases would be far outweighed by spending cuts.
Republican rejectionism was on clear display Saturday night when John Boehner, the House speaker, was forced to abandon a plan he and the president had discussed to reduce the deficit by $4 trillion over 10 years.
The plan would have gone much too far in cutting discretionary spending and entitlements, taking too much money from the economy at a time when it desperately needs government investment. But it would have been better than the slashing and burning the Republicans have been demanding because it would have raised from $700 billion to $1 trillion in additional revenue beginning in 2013 by ending tax breaks and deductions for corporations and the rich, or by ending the Bush tax cuts for families making $250,000 or more.
The House Republican leader, Eric Cantor, insisted to Mr. Boehner that his members, shackled to antitax pledges, could not accept it, or anything similar. Now negotiators are trying to reach agreement on a deal to lower the deficit by $2 trillion or so over a decade. But the consequences for the economy and Americans’ lives would be just as disastrous if all of those “savings” come out of essential government programs, with no additional revenue.
Mr. Boehner’s refusal to push back against his party’s ideologues is only feeding their worst impulses. Many House Republicans have gone even further than Mr. Cantor and have rejected any deal that raises the debt ceiling, whether it contains revenue increases or not.
Representative Michele Bachmann and Reince Priebus, the Republican national chairman, airily and irresponsibly insist that the government will find some other way to pay its bills. That’s dangerous nonsense. And as the president forcefully noted, a default could propel interest rates skyward, throw millions more Americans out of work, and create another recession.
It was good to see Mr. Obama challenging the Republicans’ illogic and pushing them to make a deal before it’s too late. But we fear the sort of deal he is willing to consider, based overwhelmingly on spending cuts, could still consign the country to more years of economic stagnation.
The president spoke about the need to create an infrastructure bank, to maintain unemployment benefits, and to protect the elderly and the poor. But keeping those goals will be nearly impossible with a debt deal that cuts three times as much spending as it raises revenue. A balanced plan, like the one Senator Kent Conrad is circulating among Senate Democrats, would cut spending and raise revenue equally, and would make it possible to pay for programs that kick-start the economy.
Americans need to hear the hard economic truth that there is no way to both cut the deficit and revive the economy without finding additional sources of revenue. As the president himself said on Monday, “If not now, when?”
By: Editorial, The New York Times, July 11, 2011
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