Re: Republicans Don't Give a Damn about the Deficit

On Jul 16, 7:21�am, Tom Davos <tda...@gmail.com> wrote:

http://www.commondreams.org/view/2010/07/15-8

Published on Thursday, July 15, 2010 by The Guardian/UK

Republicans Don't Give a Damn about the Deficit

The GOP's blocking of jobless benefits in the US Senate, while
supporting huge tax cuts for the rich, shows its stance is political

by Sahil Kapur

As the US national unemployment rate remains high at 9.5%, Senate
Republicans are persistently blocking the extension of expiring
benefits for jobless Americans. Their primary concern is, apparently,
that it'll increase the deficit.

"The only reason the unemployment extension hasn't passed is because
Democrats simply refuse to pass a bill that doesn't add to the debt,"
claimed Mitch McConnell, the Senate's Republican leader.

But are Republicans really concerned with the deficit, or is this just
a political ruse?

On Fox News Sunday, Jon Kyl, the second highest-ranking Republican in
the Senate, was quizzed about his party's commitment to reducing the
deficit. How, wondered the show's host, Chris Wallace, can the GOP
support extending the 10-year, $678bn (B#445bn) tax cuts for the
richest few while they continually block unemployment benefits by
invoking the nefarious consequences of a growing budget deficit?

"You do need to offset the cost of increased spending, and that's what
Republicans object to," Kyl said. "But you should never have to offset
cost of a deliberate decision to reduce tax rates on Americans." In
short, he claimed budget shortfalls resulting from tax cuts don't need
to be offset, but spending provisions do.

If you thought this was a slip-up or a lone viewpoint you'd be wrong.
"That's been the majority Republican view for some time," McConnell
told Talking Points Memo's Brian Beutler, trotting out the verifiably
false claim that the 2001 Bush tax cuts didn't decrease tax revenues.
"I think what Senator Kyl was expressing was the view of virtually
every Republican on that subject." (As well as Democrat Ben Nelson.)

Ponder that for a minute. The official Republican stance is that taxes
aren't relevant to budget problems, but spending is. In this case,
$35bn for the jobless (during the worst economic crisis since the
great depression) is unacceptable to them because it would bust the
budget, but $678bn in breaks for the wealthiest is fine.

This is the party that has been viciously hammering President Obama
and Democrats on the deficit over the last year and a half, and has
invoked it to filibuster legislation after legislation on all sorts of
issues (even on bills that the nonpartisan Congressional Budget Office
says will cut the deficit, such as healthcare reform).

But the contrast between opposing relatively minor spending to shield
the suffering of the unemployed while backing tax cuts for the rich
takes this double standard to new levels. Especially when the tax
breaks are projected to massively decrease government revenues.

What this suggests is that for Republicans, the deficit isn't a real
concern b it's simply a political weapon. A cynical, clever tool that
serves to weaken Obama's credibility as well as obstruct the
Democrats' legislative ambitions. Whatever Republicans believe in
their hearts, they know it's politically beneficial to prolong the
suffering of the unemployed ahead of November's midterm elections b
because, perverse as it may be in this situation, it'll wind up being
a referendum on Democratic governance.

Textbook economics say it's prudent to boost domestic spending while
running a deficit during major recessions b it shields the fall in
consumer spending, which otherwise leads to a downward spiral of
reduced investment, income, and ultimately jobs. Unemployment benefits
are ground zero in this cycle, because they cushion the free-fall in
demand while jobs are scarce. Extending these benefits would do more
to augment short-term business confidence than pinching pennies to
reduce the deficit during a downturn.

Either way, Republican tactics are working like a charm. Democrats
have given up on further stimulus due to the harsh political climate
and the sharp rise in deficit fears among the elite class (though
certainly not among the public, which deems jobs far more important).
For this, they'll pay a heavy price.

And the GOP will probably get away with it because, despite the
amazing lack of evidence, it's simply a truism in the US media that
Republicans care about the deficit while Democrats are fiscally
reckless. Those who believe this may want to compare, for instance,
the budget surpluses of the Clinton years (after he increased taxes),
with the exploding deficits of the Bush years (after he cut taxes).

It's fine and fair for Republicans to stand on large tax cuts for the
rich as a principle. But they can't do so while claiming to care a
whit about the deficit. The budget is a result of money coming in (tax
revenues) and money going out (spending). They can't disregard 50% of
this equation and claim to be concerned with the outcome. Or at least
be taken seriously while they're at it.

B) 2010 Guardian News and Media Limited