2.28.2009

Mythbusters: stop GOP lies!

Dear readers, the GOP propaganda machine must be stopped if we are to see any semblance of relief from our current economic disaster (see GDP figure in left sidebar).

It’s up to YOU to inform yourself and others of the facts.

Here, from The Progress Report, Center for American Progress (2/27/09), are the top GOP tax-and-budget myths, and the facts which dispel them:

“BUDGET: Right-Wing Tax And Budget Myths” (LINK)

Yesterday (Thursday), the Obama administration released its fiscal year 2010 budget, which lays out an ambitious course of action on health care reform, energy policy and education while estimating a deficit of $1.75 trillion for the current fiscal year. The budget also includes "significant tax increases" for corporations and wealthy Americans that will increase revenue by nearly $2 trillion over the next 10 years. The proposal allows the Bush tax cuts on the top two income brackets to expire on time in 2011, reduces itemized deductions for those making more than $250,000 a year, raises the top rate on capital gains and dividends to 20 percent (from 15), and closes the capital-gains loophole so that hedge fund and other private-equity managers have their profits taxed as ordinary income instead of capital gains. The budget also proposes a cap and trade program that would auction permits to companies that emit greenhouse gases, with the revenue directed toward President Obama's Making Work Pay tax credit. As the Center for American Progress's Michael Ettlinger noted, these changes are "going to provoke outrage." But "were this budget to be enacted, it would be by far the most significant progressive step in over 40 years," noted CAPAF Fellow Matt Yglesias.

Conservatives are already propagating various myths about the budget; The Progress Report offers these debunks:

MYTH 1: OBAMA'S RAISING TAXES DURING A RECESSION: "If there's anything that economists on the left and the right agree on, that supply-siders, classic economists and Keynesians agree on, you don't raise taxes in a recession," said Rep. Paul Ryan (R-WI). "This budget is raising taxes in a recession." The plan drew a similar rebuke from the American Petroleum Institute, the oil industry's most powerful trade group.

However, as Office of Management and Budget Director Peter Orszag said, "[F]olks need to actually look at the budget document." To avoid raising taxes during the recession, the increases will not take effect until 2011. Furthermore, the economic stimulus package signed into law by Obama last week enacted one of the largest tax cuts ever, which made good on Obama's campaign promise to cut taxes for 95 percent of Americans. The first benefits from these cuts should be seen no later than April 1, 2009.

MYTH 2: TAX INCREASES WILL RUIN ECONOMIC GROWTH: The Heritage Foundation claimed that Obama's tax proposals "sacrifice future economic growth at the altars of redistributionism," while House Minority Leader John Boehner (R-OH) called the budget a "job killer." But as Orszag said, "[W]e're returning to the tax rates that applied during the 1990's. I think all Americans -- including high income Americans -- did quite well during that decade."

The Center for Budget and Policy Priorities pointed out that "what the data do show clearly is that, despite major tax cuts in 2001, 2002, 2003, 2004 and 2006, the economy's performance between 2001 and 2007 was far from stellar." As CAP's Joshua Picker found, the Bush economy "registered the weakest jobs and income growth in the post-war period. Overall monthly job growth was the worst of any cycle since at least February 1945, and household income growth was negative for the first cycle since tracking began in 1967." Women reversed employment gains of previous cycles, and for African-Americans, the worst job growth on record was matched by an unprecedented increase in poverty.

Businesses didn't fare any better, as the Bush tax cuts "were actually followed by a pronounced decrease in the fraction of GDP devoted to business investment." Business investment fell after both the Reagan and Bush tax cuts, but rose after the Clinton tax increase, according to work by Princeton professor Uwe Reinhardt.

MYTH 3: TAX INCREASES WILL HARM SMALL BUSINESSES: Republicans, "knowing they will get little mileage from defending the rich, instead are casting the plan as a tax hit on people who run industrious little companies driving job growth," noted the AP. "A majority of those penalized by the proposed tax increase in this budget are small businesses," said Rep. Eric Cantor (R-VA). Sen. Jim DeMint (R-SC) said the proposal "shows a lack of understanding of the private sector." But as the Associated Press pointed out, Republicans are "adrift" on this one, as "many truly small operations simply don't make enough to qualify for the tax hit." Indeed, only 1.9 percent of small businesses file in the top two federal income tax brackets, which leaves 98.1 percent unaffected by the rate change. And because of the Treasury Department's broad definition of small business, "many of the roughly 650,000 filers with small-business income who face one of the top two tax rates are merely passive investors who have nothing to do with running the business."

So "the $84 of income President Bush received in 2001 from a passive investment in an oil and gas company made him a 'small-business owner.'"

Overall, only 0.7 percent of households file in the top two income brackets. As Yglesias wrote, "[A]ny small businessman who's earning a middle class income isn't paying in the top two brackets, just as any salaried employee who's earning a middle class income isn't paying in the top two brackets."

***

Over at Greenville, S.C., about 19 miles from me as the crow flies, and reportedly in towns across the nation, folks are staging a “Tea Party” in “protest of government spending.” On Friday, “several thousand protesters” gathered at the river – the Reedy River in downtown Greenville – to throw tea in the water. Of course, the local network affiliates gave these protesters of President Obama’s stimulus package and FY2009 Budget, plenty of microphone.

According to the affiliates (LINK), these modern-day Boston Tea Party demonstrations were called for by CNBC’s Rick Santelli. Santelli, seen rabid and ranting in soundbites, to quote one of my favorite movies, “Makes coffee nervous.” As my former husband, a high school principal, once said, “People will fight for two things: their children and their pocketbooks.”

Where were these South Carolinians when senators Lindsey O. Graham and Jim DeMint and their congressmen were burning greenbacks on Iraq and other Bush spending orgies?

Wish I had been at the tea party yesterday. I would have handed out copies of this post on Madeira tea napkins!

7 comments:

Tiny said...

Tiny read these too and wondered where that bunch had been the past eight years. She would have helped you hand out the napkins. Then tried her damnedest to kick as many azzzes as she could.

There is not a cure for stupidity it seems! If there were, there would be no neo-con base for the repugs. Then, there might be a possibility of some maturity from their infantile state, even if they chose to remain in the class of ignorance for the duration of their journey here.

They can twist things in more wasy than anyone can imagine. The pity of it is the number of people who swallow it hook, line and sinker.

Gregg Sutton said...

It’s funny how the Tea Party protesters have been duped into thinking that what they pay into the IRS has been earmarked to pay for their neighbor’s extra bathroom, instead of the myriad of services – local, state and federal – that government provides them every day. For six years, when the GOP ruled both the executive and legislative branches of our government, Democrats suffered through “taxation without representation” and could have thrown one hell of a Tea Party.

Dewits.com said...

I think it's funny how you rebutt the myths with Democrtat rhetoric or from sources that follow the Democrat party line.

By the way, the charitable contributions deduction is not a loophole, it is how a lot of good work gets done int his country - by wealthy people who give their money to worthy causes.

This is a direct attack on people who do manage to succeed. it is saying - you will pay more and you won't find a way out of it.

See Demwits.com for more.

by Michael Boh said...

That is a FANTASTIC post BJ! Let's keep telling the truth! Michael

Anonymous said...

Hi !.
You may , probably curious to know how one can make real money .
There is no initial capital needed You may start to receive yields with as small sum of money as 20-100 dollars.

AimTrust is what you haven`t ever dreamt of such a chance to become rich
The firm represents an offshore structure with advanced asset management technologies in production and delivery of pipes for oil and gas.

Its head office is in Panama with offices around the world.
Do you want to become a happy investor?
That`s your chance That`s what you desire!

I feel good, I started to take up income with the help of this company,
and I invite you to do the same. It`s all about how to choose a correct companion who uses your savings in a right way - that`s AimTrust!.
I make 2G daily, and my first investment was 500 dollars only!
It`s easy to join , just click this link http://irunyzesal.o-f.com/usisotur.html
and lucky you`re! Let`s take our chance together to feel the smell of real money

Anonymous said...

Hi!
You may probably be very curious to know how one can manage to receive high yields on investments.
There is no initial capital needed.
You may commense to get income with a sum that usually is spent
for daily food, that's 20-100 dollars.
I have been participating in one project for several years,
and I'll be glad to let you know my secrets at my blog.

Please visit my pages and send me private message to get the info.

P.S. I earn 1000-2000 per daily now.

http://theblogmoney.com

Anonymous said...

Hi there!
I would like to burn a theme at here. There is such a nicey, called HYIP, or High Yield Investment Program. It reminds of financial piramyde, but in rare cases one may happen to meet a company that really pays up to 2% daily not on invested money, but from real profits.

For quite a long time, I earn money with the help of these programs.
I don't have problems with money now, but there are heights that must be conquered . I make 2G daily, and I started with funny 500 bucks.
Right now, I'm very close at catching at last a guaranteed variant to make a sharp rise . Turn to my blog to get additional info.

[url=http://theinvestblog.com] Online investment blog[/url]