GREGG AND THE FORGOTTEN PRETENSE OF SERIOUSNESS…. The tax cuts of the Bush era, which contributed greatly to Republicans adding $5 trillion to the national debt, are due to expire. Policymakers are currently weighing what to do about it.
Part of the answer seems obvious — both parties want to extend the cuts for families making less than $250,000 a year or individuals earning less than $200,000.
But what about the costly breaks for those at the very top?
As for the Republicans, “we want to extend them all. That’s our position,” said Senator Judd Gregg of New Hampshire, the senior Republican on the Senate Budget Committee.
For a variety of reasons, this isn’t exactly a compelling position. Gregg may be sticking to it, but it’s only a reminder of how he approaches these issues in a fundamentally unserious way.
Look, I know Gregg has a lot invested in having voted for the failed economic policies of the previous administration, but Bush’s tax cuts didn’t work. For eight years, the job market was weak and wages were stagnant. Gregg and his cohorts promised tremendous economic growth — the kind we had under Clinton/Gore when, you know, taxes were higher — which never materialized. Given this, Gregg’s credibility is already dubious, at best.
But the circumstances also matter. When Bush/Cheney slashed taxes with Gregg’s help, the deficit was gone, surpluses were huge, and the United States was on track to pay off its debt. Eight years of failure later, Obama/Biden inherited a $1.3 trillion deficit and a $10 trillion debt.
It’s in this context that Gregg wants to keep “all” of Bush’s tax cuts. How would he pay for this? “Repeal the health care bill for starters,” Gregg proposed.
But this is incoherent — the Affordable Care Act lowers the deficit, while the tax cuts increase the deficit. Gregg can’t use the former to pay for the latter — it defies arithmetic. If he repeals the health care bill “for starters,” that makes the budget shortfall worse, not better. Gregg’s solution is gibberish.
As Jon Chait explained, “[E]ven the most allegedly committed Republican deficit hawks propose a larger deficit than Obama’s budget. Oh, sure, they have unspecified talk about cutting the deficit, but then, so does Obama. Their only specific difference is a plan to make the deficit even higher. Right now, that’s the only real fiscal difference between the two parties.”