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Palin Writes Down Cost Of Extending Bush Tax Cuts On Her Hand, But She Still Gets It Wrong

Posted in Main Blog (All Posts) on August 2nd, 2010 4:41 am by HL

Palin Writes Down Cost Of Extending Bush Tax Cuts On Her Hand, But She Still Gets It Wrong
Since he was on the campaign trail, President Obama has proposed renewing the 2001 and 2003 Bush tax cuts for the lower- and middle-class, while allowing them to expire on schedule at the end of the year for the richest two percent of Americans. Republicans, however, have begun to obfuscate the issue by saying that […]

Since he was on the campaign trail, President Obama has proposed renewing the 2001 and 2003 Bush tax cuts for the lower- and middle-class, while allowing them to expire on schedule at the end of the year for the richest two percent of Americans. Republicans, however, have begun to obfuscate the issue by saying that the end of the year will bring history’s largest tax increase, deliberately leaving out that Democrats have proposed extending most of the cuts.

Rep. Mike Pence (R-IN) pulled this rhetorical trick last week, saying “Democrats are poised to allow the largest tax increase in American history to take effect,” and on Fox News Sunday today former half-term governor Sarah Palin went down the same road. Fox’s Chris Wallace rightly pointed out that “the Republicans keep talking about being deficit hawks. This is $678 billion you are not going to pay for.” Palin responded “no, this is going to result in the largest tax increase in U.S. history. Again, it’s idiotic.”

Wallace proceeded to let Palin spend the next minute reading from notes on paper that she had written down. He interrupted her just for a moment to ask if she had anything written down on her hand, to which she responded that she did:

PALIN: My palm isn’t large enough to have written all my notes down on what this tax increase, what it will result in.… Democrats are poised to cause the largest tax increase in U.S. history, it’s a tax increase of $3.8 trillion in the next ten years and it will have an effect on every single American who pays an income tax. Small businesses, especially, will be hit hardest. Small businesses account for roughly 70 percent of our job creation in this country. So raising taxes on these employers is the worst thing that can happen.

WALLACE: Can I ask you, what do you have written on your hand?

PALIN: $3.8 trillion in the next ten years, so I have didn’t say $3.7 trillion and get dinged by the liberals saying I didn’t know what I was talking about.

Watch it:

Despite the preparation of her “cheat sheet,” she still doesn’t know what she is talking about.

For one thing, according to the Pew Economic Policy Group, an extension of all of the Bush tax cuts will cost $3.1 trillion over ten years, once the costs of servicing the debt are factored in. But no one has proposed allowing them all expire, and it’s incredibly disingenuous of Republicans to claim otherwise, especially since it was a budget gimmick by former President George W. Bush to include the ten-year sunset at all.

Extending just the cuts for the wealthiest two percent of Americans will cost $830 billion over ten years. As Center for American Progress Associate Director for Tax Policy Michael Linden wrote, “to put that figure in perspective, $830 billion is enough to pay for all veterans’ hospitals, doctors, and the rest of the Veteran’s Affairs health system, plus the United States Coast Guard, plus the Food and Drug Administration, plus the operation and maintenance of every single national park for the entire 10-year period — with more than $100 billion left over.”

It was good that Wallace pointed out to Palin that Republicans are being hypocritical by complaining about deficits at the same time they’re calling for renewing huge tax breaks for the wealthy, but he then let her spew irresponsible claims that have no basis in reality.

Boehner Spouts Anti-Intellectualism Screed: ?I Don?t Need To See GDP Numbers Or Listen To Economists?
This morning on Fox News Sunday, House Minority Leader John Boehner (R-OH), who has waffled on the impact of the stimulus, argued against the need for more stimulus funding. He claimed that he doesn’t need to listen to economists when putting together his policy agenda: WALLACE: Congressman — a number of top economists say what we […]

This morning on Fox News Sunday, House Minority Leader John Boehner (R-OH), who has waffled on the impact of the stimulus, argued against the need for more stimulus funding. He claimed that he doesn’t need to listen to economists when putting together his policy agenda:

WALLACE: Congressman — a number of top economists say what we need is more economic stimulus.

BOEHNER: Well, I don’t need to see GDP numbers or to listen to economists. All I need to do is listen to the American people, because they’ve been asking the question now for 18 months, “where are the jobs?”

Later, the interview grew a bit more hostile as Wallace tried to press Boehner on the deficit-impact of his call for extending the Bush tax cuts. “Chris, you’ve been in Washington too long because that’s all a bunch of Washington talk,” Boehner said dismissively. “I’m just asking a question, sir,” Wallace persisted, noting the exorbitant cost of extending the Bush tax cuts for the wealthy. “This is the whole Washington mindset, all these CBO numbers,” Boehner responded. Watch it:

Boehner — whose blind political ideology often leads him to oppose anything that Democrats and Obama might be supportive of — is not interested in hearing the facts. The GDP numbers that Boehner doesn’t want to see showed a relatively weak 2.4 percent growth rate in the 2nd quarter, which indicates that the economy is losing momentum:

MW-AF692_econom_MD_20100730085435

The consensus from leading experts is that the original stimulus was too small for the magnitude of the crisis. Forty notable economists and historians, including Joseph Stiglitz, Alan Blinder, and Mark Zandi, recently signed their names to statements calling for more government stimulus. “The urgent need is for government to replace the lost purchasing power of the unemployed and their families and to has praised in the past — has said that deficit spending is critical in the short-term and that pulling support from the stimulus isn’t the right solution. “At the current moment…the large deficits, as unattractive as they are, are important for supporting economic activity, and they were important also in restoring financial stability,” he said. “And so I think they were justified in that respect, and I would be reluctant to withdraw that support too precipitously in the near term.”

CBO Director Doug Elmendorf — yet another expert that Boehner has praised in the past — has explained that there is “no intrinsic contradiction” between supporting more stimulus now and demanding deficit reduction later. Yale economics professor Robert Schiller writes in today’s New York Times, “We need more stimulus, not less — but we need to focus much more on actually putting people to work. … [U]nless we take new measures, we face the prospect of protracted unemployment.”

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