There are currently two schools of thought on reducing the deficit. The first is to actually reduce the deficit in a meaningful way, by letting Bush's tax giveaway to the top 2% expire. "You have to pay your bills; you can't keep borrowing from the rest of the world at that magnitude, year after year after year. So in light of all of those facts, I say we can't afford the Bush tax cuts," says former Reagan budget director David Stockman. The gap between the very rich and everyone else grew dramatically under George W. Bush, with all the benefit going to the very wealthy -- who, by the way, are also the ones who ran the economy off the cliff with crazy get-richer-quick schemes.
"Two years after the crisis on Wall Street, it has been announced that bonuses this year will be $144 billion -- the highest in history," Stockman points out. "That's who's gonna get this tax cut on the top, you know, 2 percent of the population. They don't need a tax cut. They don't deserve it. And therefore, what we have to do is focus on Main Street."
Of course, the other school of thought on deficit reduction is to pretend to reduce the deficit with penny-pinching plans that punish everyone but the rich. But keep those tax cuts for the top earners, because to do anything else just wouldn't be fair. Taking from you to give to some Wall Street suit is apparently "fair." Raising the retirement age for Social Security, for example, screws you pretty bad, but it's not much of a hit to Mr. Moneybags here. But worse, it also hurts you more by making the job market more competitive. The principle of supply and demand dictates that this will drive wages down -- another loss for you, but a win for Moneybags who likes the cheap labor. In other words, you pay a penalty for being responsible and you pay it to the economic kamikaze pilots on Wall Street. I'm with Stockman here, they don't deserve the tax cuts and they don't deserve a bite out of your piece of the pie.
And, of course, raising the retirement age for Social Security doesn't do a whole lot. The entire cost of Social Security is $730 billion and this plan would only reduce that cost by a fraction. And, since a higher retirement age would drive down wages and reduce payments into the fund, you can cut that fraction down even more. Figure in the $1.27 trillion deficit and you can see why I used the term "penny-pinching plans." It's a smoke and mirrors move to get away with spending a tiny bit less and accomplishing next to nothing in terms of deficit reduction and worse than nothing in terms of job and wage growth.
You know what really gets me about conservatives? When there's a war, they're the first ones to shriek, "Freedom isn't free!" But, when it comes to taxes, freedom is totally free. It's an equation that puts other people's lives below their own wallets in terms of importance. If we don't run out and blow the living crap out of some third world hellhole in some god-forsaken desert over pretend weapons, the republic is doomed. But we can go ahead and finance those wars -- and the rest of government -- with unicorn farts and rainbows. Because that's supposed to be what men of reason like Jefferson and Franklin intended. Apparently, the founders loved war and hated math -- which I suppose would explain the current Republican War on Math.
It's somehow fitting that our deficit is something of a toxic asset -- a mixture of good and bad debt. The bad debt came from the Bush administration, which threw money down a rathole with almost nothing to show for it, money just pissed away. The result of all that bad debt? A stagnant economy (before it finally crashed) and the worst record of job creation that we know of -- government began tracking that data during the Truman administration and no president we have data for has ever done worse. And, of course, all that debt.
And the good debt? That's infrastructure investments and healthcare reform -- which, by the way, is projected to reduce the deficit.
So what'll it be -- tax cuts for bazillionaires which have a proven tack record of accomplishing squat but increasing that bad debt or something a little more realistic?
Come one, this is America... What do you think?
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