Thursday, July 15, 2010

Republican Logic

The Republicans have their new strategy - they are against the deficit as an evil, horrible, awful thing that is causing joblessness, and they want to extend the Bush tax cuts for the rich. If those two ideas seem to be diametrically opposed, well, they are. But the Republicans aren't ones to let the facts get in their way.

Their narrative now is that tax cuts don't add to the deficit and don't have to be paid for. This is complete nonsense and even they know it, but that doesn't matter if they can get people to vote for them.

If you look at the chart you can see this is completely false, the tax cuts are THE reason for our current deficit, adding up to almost as much as both wars, the recovery, TARP and the economic downturn combined.

Yet the Republicans think they can get elected by stopping unemployment insurance for those out of work because it MUST be paid for and can't be added to the deficit. You know how much those unemployment benefits will add to the deficit? .01%. Yes, you are reading that right, one tenth of one percent. The Republicans won't add that to the deficit but are willing - and even anxious - to keep those tax breaks for the very rich when they will be 45% of the entire deficit.

And those tax cuts to NOT increase economic activity, each dollar spent in tax cuts results in $.35 of economic activity. 35 cents on the dollar, while unemployment payments creates $1.64 for every dollar spent. The rich put those tax breaks into savings or off shore banks to avoid taxes so there is little economic stimulus, while unemployment checks go to people who are struggling and all of that check gets spent, causing economic activity.

The sad part is that this ridiculous ploy will probably work because most voters are stupid.

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