By James Kwak
The Times has a story out today: Surprise, all the Republican candidates’ tax plans increase the national deficit! The numbers (reduction in 2015 tax revenues, from the Tax Policy Center):
- Romney: $600 billion
- Gingrich: $1.3 trillion
- (Late lamented) Perry: $1.0 trillion
- Santorum: $1.3 trillion
I guess that makes Romney the “fiscally responsible” choice, at least among the Republicans. But President Obama’s tax proposals would only reduce 2015 tax revenues by $222 billion. (That’s $385 billion in Table S-4 less $163 billion in Table S-3.)
Second surprise: The big winners in all of these tax plans are the rich! (That’s not just in dollars, but in percentage increase in after-tax income.)
I don’t mean to be hard on the Times reporters. This is exactly the kind of story they should be writing. Someone has to point out that the same people who are complaining about deficits are proposing to vastly increase those deficits. Especially when their fantastic claims are essentially going unchallenged on the campaign trail.
The Baseline Scenario 
Wait, so when you cut taxes, you reduce the money collected in taxes?
And when you cut taxes, you cut them the most on the people who pay the most?
Department of “Duh”, indeed.
Too bad there is no way to reduce the deficit other than raising taxes. Stupid Republicans.
So where’s the Ron Paul plan analysis?
Is Ron Paul deemed unelectable by the Times as well??
They are not so stupid in their own mind. They rely on the economy to expand at their given rate to justify today’s debts, because we will always have a better economy down the road to pay off those debts. He who does not promise to increase the economic expansion, does not get elected. He has yet to reilze that we are out of economic boom cycles, yet campaigns heavly over and over again, praying that, this time and him will make the difference and all will be good in the world. Wash, rinse, and repete as needed, works every time.
I totally agree with the Ron Paul comments. James, you just wrote an entry about Paul… can you do some digging and make an addendum with numbers for Paul’s plans?
Don’t have to look at Paul’s numbers. If elected he would promptly put us into a Great Depression. There is a fate worse than deficits.
@beezer Seriously? You won’t consider honest numbers on Paul’s policy? I’m sure it’s got problems, but I seriously dispute they are remotely close to the magnitude you claim. But what’s worse is you seem to just dislike him. That’s not a very good reason to not vote for him. That’s why I want to see numbers with sources.
I want to know who these crooks are, is that Nixon watching over the signing away of America. And don’t that look like G.W along side of him too. How long before people simply give up on politics?
Click to access deposito.pdf
This must be Boston political cancer spreading like the breeze it is.
I would like to see some estimates from Ron Paul
Let’s see some estimates from Ron Paul.
Ha Ha, are you kidding me?
Kwak, your fantastic claims are essentially going unchallenged.
When Romney’s plan reduces the corporate tax rate from 35% to 25%, fancy schmancy “tax policy center” jokers completely ignored the fact that a lower rate will stimulate hiring which will stimulate the economy which will lead to an increase in revenues.
We already have simpson-bowles (which of course Obama rejected because it did not have $1B/year coming from corporate jets). We don’t need more plans.
I think you already know all this stuff but find it hard to understand why you chose to promote irrational and illogical commentary from the “Times”. Suddenly journalists and newspapers are a book of record? Ha Ha.
Indeed, the Times should continue to write stories like this so that already dumb americans get dumber!
No wonder, i find this to be the land of opportunity, even after the 30% reduction in my bonus.
Country of “Duh” indeed.
There is no historical data that would suggest the drastically lower RATES would stimulate hiring (or anything other then more debt), particularly given that the actual tax percent paid in the US is one of the lowest in the industrialized world.
I would presume that you are implying “dynamic scoring” (or whatever it’s called) is a legitimate accounting method?
I “vote” for numbers from Ron Paul, as well. …..Lady in Red
PS: James, did you not notice the Ron Paul is a “Republican candidate?”
Does anyone know if this video is a violation under SOPA???
Gee, James, we’re all sooooo surprised. The Republicans voting to increase their wealthy friends’ share of the economy? Absolutely unthinkable!!
Seriously, let’s think about this. It is, IMO, impossible to reduce the debt in any meaningful way without a vast overhaul of our income tax code. That is beyond question. It MIGHT be possible to reduce the prevailing rates if we did so, at least both debt commissions thought it possible. There are certainly lots of rational answers to the various dilemmas confronting us fiscally, but none of these will ever be enacted until we overturn Citizens United and Valeho(sp?) with a Constitutional Amendment, enforce term limits and tighted lobbying rules greatly.
So, where are the numbers for Ron Paul, Gary Johnson, Buddy Roemer, Rocky Anderson? These are all legitimate candidates with better plans than the ones you mention.
I hope we get to pick someone rational. Thusfar, the R’s at the top scare the crap out of me. Finding truth somewhere in what they say is impossible.
The fascists in the nazi…. I mean republican party are too busy focusing on dictating their perverse freakish vision of morality to win the redneckamerikan vote to bother with silly things like basic math and economics. Throwing the bloodthirsty biggots and racists redmeat while stealthfully continuing to advance and shield the predatorclass is all these nazi’s… I mean republicans care about.
It’s kabuki theater. All the bruting and pimping and hollow empty promises and proclamations are substantless blabber, “full of sound and fury, signifying nothing”.
A pox on the nazi… I mean republican party!
They speak with forked tongues, and have no eyes, no ears, and no hearts.
Tear it all down!!! Reset.
“all the Republican candidates” except one of the frontrunners, Ron Paul
hey moses, Break My Windows. after the car catches fire all by itself simply goin uphill. That’s what we call the german hot head.
Silly me. I thought that expenses also had something to do with whether the deficit increased or not.
With all due respect to Kwak, NYT, and the Tax Policy Center, the proper analysis should be that the Republicans candidates are proposing to reduce taxes for American workers between $600B – $1.3T. I don’t see why whether you make $10k or $10Mil per year why that would be a bad thing for anyone. This is typical liberal speak that everyone should pay more taxes than me if they make more money than me. Don’t begrudge others that might have more than you, aspire to achieve what they have achieved. Lets look at reducing government spending.
Very suspicious that that aren’t ron paul numbers.
@Don’t have to look at Paul’s numbers. If elected he would promptly put us into a Great Depression. There is a fate worse than deficits.
beezer
January 19, 2012 at 5:19 pm
Beezer, we are going into a Kondratief winter. A depression is already inevitable. Would you rather go into a Depression with 400%+ debt/to GDP (All other candidates) or 350% debt to GDP (Ron Paul).
@Ha Ha, are you kidding me?
Kwak, your fantastic claims are essentially going unchallenged.
When Romney’s plan reduces the corporate tax rate from 35% to 25%, fancy schmancy “tax policy center” jokers completely ignored the fact that a lower rate will stimulate hiring which will stimulate the economy which will lead to an increase in revenues.
Desi Girl – Doing God’s Work
January 19, 2012 at 10:04 pm
unfortunately economy is demand-driven, not supply driven. Lowering tax rates does increase demand, but much less compared to other keynesian alternatives.
James, make a graph of yearly Federal deficits annually starting in 1952 (when the war debt had essentially disappeared). You will find that except for Eisenhower, every increase in the rate of debt has happened during republication administrations, dramatically, repeatedly, and under varying economic conditions. And all of them decried the existence of debt and promised to reduce it. You don’t need to rely on projections from current republican budget plans to make your point — just use the history.
The Tax Policy center did not analyse Ron Paul’s numbers, without and explanation I could find. It’s bizarre that RP is systematically discounted, even though his numbers have so far made him the only consistent challenger to Romney. One doesn’t have to be a Paulista to find this strange.
James Kwak misrepresents this story. The analyses are of what each candidate’s plans do to revenues, not deficits. Surely they’ll claim they’ll make cuts sufficient to balance to budget (hah!). But more importantly, they may well differ in what they would propose for spending.
OTOH, since Congress, not the President, really has control of the budget (or is supposed to), that’s where the real action is.
It’s long past time for a 3rdparty (or maybe even a 4th, or 5th, or 6th-partycandidate.). The democratic party -(with few marginalized exceptions – Kucinich and Sanders who caucuses with the dem, but campaigns as an ‘independent) – are what the gop used to be.
Democrats shamelessly pander to and advance predatorclass oligarchs, and predatorclass interests exclusively.
Socalled republicans are nazi’s, fascists, extreme right partisans advancing the most bigotted, racist, mysoginist, elitist, corporatist, oligarch friendly nonesense on earth. How are the different from the leadership of Syria or Iran outside of their devotion to a single prophet or book? The policies and core ideologies are identical. Feed the predatorclass, the superrich, and – my god is betterthanyourgod gibberish.
We need new voices and parties, new choices, new alternatives .
The Amerikan political system and process is a putrid, malignant cancer! We, the people are always left with thelesseroftwoevils!!!
We have no real choice!
No one is promoting or advancing the people’s best interests!
All our socalled leaders are purchased spaniels, trained pets of the predatorclass!
We have no voice or influence in the conduct of the socalled government!
We inhabit a fascist state- a kleptocracy!
Either we invite multiple parties and voices into what little remains of our political process – or it’s guns, guns, guns! Many of us will not go like sheep to the slaughter, or moths to the flame. We will fight our oppressors, and there will be blood predatorclass biiiiaaaatches! There will be blood!
We’ve had lower tax rates on the rich and corporations for the past 10 years, and the country slid in to recession. The fact that Republican constituents still think lowering taxes on those two segments will do anything positive for anyone not filthy rich at all speaks volumes about their blindness and/or complete lack of cognitive functionality.
And really folks, who cares what Ron Paul thinks? It’s been obvious since the primary campaign season started that the Republican leadership has decided Mitt Romney will run on the conservative side. Ron Paul will be ignored, shunned, and pushed aside ensuring that his election has less than a snow ball’s chance in hell of actually occurring.
We will not get mature adult reasoning from either side of the aisle. Just sit back and enjoy the ride as they run the country straight in to the ground without a moment’s thought of avoiding disaster.
@3-D: you follow too much tainted media, evidenced by your perception of Ron Paul and resignation to sit on the sideline and watch the “Hollywood show” broadcasts.
@all: Getting wound-up on debates spun by the “paid media” around puppet candidates, democrat, republican or otherwise, are sleight of hand to keep the masses occupied and debating. “Hollywood-style” influencing of the masses to overlook the reality.
Party affiliation has been irrelevant. In the last century. Big money has placed politicians into office (and not limited to the Presidential office), and in turn the “selected” (or bought elected) government has protected and lined their pockets at the public’s expense.
For those of you bashing “republicans” or “democrats”, first try to name one administration since 1913 and the creation of the Fed, that hasn’t been is service of the “ultra wealthy”. Remember the Clinton era S&L scandal and Bailout? the Bush bailout plan? the Obama bailout and TARP? Are you catching on who is really protected and benefits from all these bailouts?
Do you have the $1B minimum to participate in this next transfer of wealth from the “middle-class-going-broke” to the rich?
“Obama administration is getting ready to transfer billions of dollars”: http://www.cnbc.com/id/45925851
Do you really think choosing a republican or democrat, or lowering or raising taxes make any difference when the wolves are in charge of the hen house, printing money at-will, and writing I.O.U.s signed in your name without our consent? (actually they have our consent, because “we the people” sat back and let them proceed, or blindly supported the process, guided by a steady stream of tainted media influence).
When we give up our civil liberties (or sit on the sideline) and allow the “government of special interests, elected by the special interests, and for the special interests” take charge, the special interest elites will reap the benefit of their political investments in lobbyists and campaign contributions, at the public expense.
As far as I can tell, the only candidate that speaks the truth and presents the unpleasant reality, and has been consistent for three decades is…. RON PAUL. The one all the mainstream corrupt media try their best to shove under the carpet. How surprising that his budget wasn’t even mentioned by the Times.
So… you may not like Ron Paul’s position on all matter (I certainly don’t agree with several), but ignoring the facts won’t make them go away. And allowing the general media to convince you that he doesn’t count or doesn’t stand a chance is exactly where they want you.
Before you dismiss Ron Paul and buy into the tainted media campaigns suggesting some Republican or Democrat is the “chosen”, game over, take a closer look at the facts.
And if you have any doubt about “the people’s” ability to make a difference and force change, take a look again at PIPA and SOPA:
http://blogs.wsj.com/washwire/2012/01/20/ron-paul-hails-halt-to-internet-legislation/
A nazi wins the great state of southcarolina. They still fly the confederate flag. Start preparing your fiveyearolds for slavelabor! Continue imagining the socalled free markets are operating in goodfaith, and under theruleoflaw. Praise thebabyjesus! Amen.
Newt is the 5thbestchoice. The lesser if five evils. The entire elections process is kabuki theater. Absurd comedy.
The predatorclass owns and controls the socalled government, and the industry oligarchs. The weapons are fearsome.
Their powers seemingly otherworldly and hypersuperior. But insurgents always dismay empires, because spirit and rightgeousness are not easily defeated. There will be blood, – but insurgents usually win.
Politicians say things on TV – but all of it is lies!!!
If you are predatorclass, you support this charade. If you are the other 99%, – buckleup. Place your trays in the upright and fixed position. We’re about to enter some turbulence.
What about ron paul?
Paul says one trillion in cuts the first year, across the board, so to speak. Closer inspection reveals however, the military bloated budget gets whacked about 15% to other federal departments where 30% is the norm.
For a fella preaching the hazards of USA world (military-hegemonistic) empire, (and who can says Mr PAul is wrong here?), this appears to be having a slice of sweet cake with peaches and eating it too!
Paul also favors ” right to work” provisions nationally, which is UNION BUSTING, ANTI LABOR, ANTI DECENT WAGE ECONOMY and incredible exploitation of a downtrodden USA work force…the Walmart, Target, and all the other abusers!
You can have both Pauls, they are both full of crap.
Word Woop!
I tried to read all of the comments but wearied after reading so much disinformation and truly misconceived notions on how our monetary system actually operates. For those who are really interested, we abandoned Bretton-Woods standards in July, 1971. Yep, 41 years ago or so and have been, since that point, a sovereign currency nation. We are a currency monopolist…the sole issuer of our currency…backed by the good faith and credit of the USG.
As author, Prof. Warren Mosler puts it, “The fact that government spending is in no case operationally constrained by revenue means there is no “solvency risk.” In other words the federal government can always make any and all payments in its own currency, no matter how large the deficit is, or how few taxes it collects.” Mosler continues, “This, however, does not mean that the government can spend all it wants without consequences. Over-spending can drive up prices and fuel inflation.”
Enter tax and borrowing tools. These regulators for aggregate demand assist in managing inflation, they do not raise revenue. The government cannot go broke for the lack of tax dollars. It doesn’t need tax dollars to spend. It’s the sole issuer of the currency and must spend that currency before it can tax, not the other way around.
President’s, MAJOR name economists, academics, media mavens and financial experts, as well as 99.9% of Americans have no clue as to the operational ramifications of the above axioms and thier role in how many is managed in America.
All of these folks talk about the government going broke, Obama alluded to this in the recent SUTU address.
Deficit terrorists rave on about its size and dire consequences and not once do they mention the other side of the deficit coin….savings. Gov. deficits are exactly equal, dollar-for-dollar, to non-government sector savings (including net exports).
Let’s here it for non-government sector savings the higher the better and the sooner we’ll bring down unemployment and return to fiscal sustainability. But no, you won’t here that because too few policy makers in America know anything about simple national income accounting absent the relics of gold standard rubrics.
You mistake sovereign currency and sovereign risk. Currency stays at home, and when it does not, it turns into risk. Once out of the country it becomes hyper money, and to borrow/print more than a 40% ratio to the yearly national debt becomes what we call hyper-inflation. This in turn creates competition from new sources and dwindling resources at home. Take oil for example, Saudi country’s currency is back by gold and they do not borrow money to pay for social services. They have reserves of oil and get a set price to account for their social obligations, we have no such commodity stored for this purpose. They too can simply print money, but do not for price inflationary reasons.
True, we went off the gold standard in 1971 and that is where a sovereign default technically occurred and the price of gold has risin ever since. Today the price of oil ,[and gold], have reached record highs and threaten to rise even more straining an economy that has a load of UNfunded liabilities competing with country’s that have no such burden on their citizens. No, your stuff reminds me of the same old line trying to be towed. But needing support for a lack of something, in which we need to be educated on so we can agree with you on it, and then carry or pass your torch well into the hyper-inflated future. Good luck signing people up there but I won’t be on board.
Ron Paul didn’t fit into the article’s prompt title