And don't start scoffing, progressives. Your chosen presidential candidate who now sits in the Oval Office has reneged on yet another of the few rock-solid pledges he made during his campaign two years ago.
Just one month and four days after the midterm elections, President Obama reached a compromise with congressional Republicans this week, agreeing to extend all of the Bush-era tax cuts for another two years. In return, GOP lawmakers agreed to end an impasse over aid for the long-term unemployed and extend coverage for another 13 months.
Both the tax cuts and unemployment benefits were scheduled to expire Dec. 31.
The deal's net result — when combined with other concessions won by Obama — will add $900 billion to the federal deficit during the next two years. You read that correctly. That's $37.5 billion each month for the next 24 months — the vast majority of which will be used to pay for tax cuts to millionaires and billionaires.
After a hard-fought election filled with much bellowing about skyrocketing deficits and out-of-control federal spending, the United States is going to borrow even more money, most of it from our lender of choice, communist China.
Let's pause to remember some of the heated invective about the Democrats' spending habits during this year's campaigns by Republicans, led by the Tea Party's alleged concern over spiraling debt.
Here's what Steve Chabot (R-Westwood), the once- and future-congressman from Ohio's 1st District, said a while back: “We need to get the spending in Washington under control, it is absolutely out of control. It wasn't as fiscally disciplined as it should have been under Republican control, it's completely out of control since the Democrats took over completely two years ago."
But like most GOP candidates in the last election, Chabot also wanted to extend the Bush tax cuts for all, a contradictory goal. "It's clearly a mistake to be raising taxes, especially in these tough economic times," Chabot said during a September debate.
Of course, Chabot hasn't returned to office yet; he doesn't get sworn in until next month. Still, Chabot no doubt would've joined his good buddies Congressman John Boehner (R-West Chester) and Sen. Mitch McConnell (R-Louisville) in voting for the deal, as it was the top item on the GOP's agenda.
Based on their past statements, the same holds true for most of the incoming Republican members of Congress. And this is despite all the bowing and worshipping the GOP gave to Tea Partiers during the last election cycle.
Who can forget Boehner's statement: “It’s not enough, however, for Republicans to simply voice respect for what the Tea Partiers are doing, praise their efforts and participate in their rallies.
Republicans must listen to them, stand with them and walk among them.”
Except when they don't. Boehner and McConnell took the lead on cobbling together the latest deal, essentially holding unemployment benefits hostage to win tax cuts for themselves and their wealthy friends. A majority of the Bush tax cut's benefits — 52.5 percent — goes toward the richest 5 percent of taxpayers. Put bluntly, the nation is going deeper into debt so the wealthy can keep more of its cash.
As a friend of mine aptly described it, “If I didn't know any better, I would guess that the politicians who promised a new era of fiscal responsibility and scared voters to death talking about out-of-control deficit spending were lying and really only cared about preserving tax cuts for the rich.”
For real, yo.
Let's make something clear for Tea Partiers and other so-called deficit hawks: Statistics show that the Bush tax cuts cost more than twice as much as the health-care reform bill passed by Democrats earlier this year.
Government data crunched by the Crooks and Liars Web site shows the tax legislation enacted under Bush cost $2.48 trillion over the 2001-2010 period. It includes $2.11 trillion in lost revenue attributable directly to the cuts, along with $379 billion in additional interest payments on the national debt that must be made since the tax cuts were deficit-financed.
In other words, we borrowed the money to pay for the tax cuts, mostly from China. And we're about to do it again.
As the Center for Budget and Policy Priorities stated last summer, “Together with the economic downturn, the Bush tax cuts and the wars in Afghanistan and Iraq explain virtually the entire deficit over the next 10 years.
“If not for the tax cuts enacted during the presidency of George W. Bush that Congress did not pay for, the cost of the wars in Iraq and Afghanistan that were initiated during that period, and the effects of the worst economic slump since the Great Depression (including the cost of steps necessary to combat it), we would not be facing these huge deficits in the near term,” the center added.
Now's a good time to note that Boehner, McConnell and Chabot all were part of the GOP-controlled Congress that enabled Bush's reckless policies. The terrible trio will tell you reducing taxes leaves the wealthy with more money to invest, which results in job creation. Bunk.
That philosophy, known as “trickle down economics,” is even derided nowadays by its creator, David Stockman, who was budget director under President Reagan. Regardless, a look at the facts proves the theory is bogus.
As we've noted before, Bush had the lowest job-creation rate of any president since his father. Among modern presidents, only Gerald Ford fared worse.
The Wall Street Journal wrote, “The Bush administration created about 3 million jobs (net) over its eight years, a fraction of the 23 million jobs created under President Bill Clinton’s administration and only slightly better than President George H.W. Bush did in his four years in office.”
Even Jimmy Carter created 10.5 million jobs during his single term. Ponder that: Carter created more than three times as many jobs as Dubya.
No matter how many times Republicans insist to the contrary, “trickle down” just doesn't work. (Care to offer a response, Mr. Boehner or Mr. McConnell?)
Although Obama campaigned vigorously and unambiguously in 2008 for ending the tax cuts for individuals who make more than $250,000 annually, he says he had little choice but to compromise to extend unemployment benefits and get a de facto stimulus for the economy. Under the deal, Social Security payroll taxes will be cut for all workers for a year. The 6.2 percent tax will temporarily drop to 4.2 percent, leaving more money in paychecks. Also, the deal expands the earned-income tax credit, continues a college-tuition tax credit for some people, and lets businesses write off the cost of some new equipment.
Additionally, the alternative minimum tax would be altered so up to 21 million households wouldn't have to pay it, The New York Times reports.
In return, the GOP gets concessions on capital gains tax rates and on the federal estate tax — again, two items that primarily affect wealthy investors.
The deal still needs congressional approval, and that's not certain. Many progressives see Obama's compromise as a betrayal and Sen. Bernie Sanders (I-Vt.) has threatened a filibuster.
"I think for a Democratic president, a Democratic House and a Democratic Senate to be following the Bush economic philosophy of tax breaks for millionaires and billionaires is absolutely wrong public policy and absolutely wrong politically," Sanders told MSNBC.
Whatever the outcome, the sorry situation causes me to think that if Democrats are pegged as “tax and spend,” then it follows logically that Republicans follow the philosophy of “borrow and spend.”
My parents always told me to live within my means and be careful about borrowing money, advice I've tried to live by.
When the United States borrows money from a nation like China, which has many interests that run contrary to ours — ranging from human rights to trade — it makes me wonder what advice Republican lawmakers got from their parents while growing up.
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