Don't get me wrong. I don't want taxes to go up. I want spending to come way down. Also, I like Paul Ryan - I hope he ends up on the ticket with Mitt Romney.
However, I object to Ryan and much of the GOP calling it a tax increase if the Bush Tax Cuts are allowed to expire, arguing that they've been the tax rate now for 10 years. This was Paul Ryan's position on Friday when he appeared on This Morning with Charlie Rose on CBS. When the Bush Tax Cuts were enacted, they came with a sunset provision to make them expire in 2010. The country's revenue models assume that those taxes return on schedule. Any deals to extend those cuts or make them permanent should be considered a new tax cut and the lost revenue should be balanced with spending cuts. A deal was cut in 2010 to extend these cuts for two more years and included a smorgasbord of other stimulus measures, like a one-year 2% reduction in the payroll tax, an extension in unemployment benefits, etc. All told, the cost of that legislation came to an eye popping $858 billion. As far as I know, that cost was basically just tacked onto the debt.
President Obama used the same disingenuous "tax hike on the middle class" language to lambast the Republicans when that 2% payroll tax cut was about to expire on New Year's. Remember Obama talking about how the middle class wouldn't be able to afford pizza night every Friday since the tax amounts to about $40 per week for the average family? In the end, the Republicans went along with Obama to extend that cut for 2 months. It was disgusting how they paid for it, though. For the next 10 years, every mortgage will have a fee tacked on amounting to an interest rate hike of about 0.125% for the life of the loan. That's a whole point - pretty steep for 2 months of pizza nights! Also, the money generated by that mortgage fee does not go into the Social Security fund where the payroll tax revenue belongs, but rather goes to the general Treasury where Congress can spend it. I missed the deal that extended the payroll tax into the summer, but it looks like they're letting it expire at last.
In the latest Bush Tax Cut fight, the Democrats want the cuts to expire except for those making under $250k and the Republicans want to extend the cuts for everyone. The Republican House and the Democratic Senate seem intent on preventing either bill from going anywhere. Senator Scott Brown (R-MA) has made the gutsy, responsible vote of NO on both bills. See article. Way to go, Scott - thank you for making the tough call. Of course, Elizabeth "Fake Indian" Warren has already hounded him for hammering working families, but deep down, I think we all know that one day, the Chinese are going to want their money back for all the tax cuts we insisted on taking without any spending cuts to offset them. Only when Congress gets around to cuts in spending will I feel like they're looking out for our best interests. I'm not holding my breath.
As for the "tax hikes" and "hammering working families" attacks, spare me the misrepresentations and lies. If the recent cuts to student loans rates from 6.8% to 3.4% ever go away, I suppose that'll be a doubling of student loan rates - those mean Republicans. We'll have to slash unemployment benefits to ever see them go from 99 weeks back down to 26 weeks where they were when the system was solvent.
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