HOLD BUSH AND CHENEY ACCOUNTABLE

THE SAME OLD STORY WITH THE REPUBLICANS


Republican leaders in Congress don't like President Obama's stimulus package because it provides for spending and not for tax cuts. We have to keep in mind that when Republicans talk about tax cuts they're not for you and me. They're for their fat cat friends. History proves that spending generates far more jobs and stimulates the economy more than tax cuts. What the Republicans are really afraid of is a successful Obama administration because that would send them into the wilderness where they belong for years and years. This commentary by Paul Krugman is at www.nytimes.com:

The point is that nobody really believes that a dollar of tax cuts is always better than a dollar of public spending. Meanwhile, it’s clear that when it comes to economic stimulus, public spending provides much more bang for the buck than tax cuts — and therefore costs less per job created (see the previous fraudulent argument) — because a large fraction of any tax cut will simply be saved.

This suggests that public spending rather than tax cuts should be the core of any stimulus plan. But rather than accept that implication, conservatives take refuge in a nonsensical argument against public spending in general.

Finally, ignore anyone who tries to make something of the fact that the new administration’s chief economic adviser has in the past favored monetary policy over fiscal policy as a response to recessions.


THERE'S NO FREE LUNCH

In essence, what Ronald Reagan and proponents of "supply side economics" have preached is a free lunch. You can cut taxes and spend and the road will lead us to the promised land. Supply side economics says that when you cut taxes for rich people they will invest the money they saved in taxes and create jobs and prosperity for all. What we've seen through the Reagan and two Bush administrations is massive deficits, a huge gap in inequality, rising poverty, crumbling infrastructure, and inadequate government services. This commentary by Thom Hartmann is at www.commondreams.org:

George W. Bush embraced the Two Santa Claus Theory with gusto, ramming through huge tax cuts – particularly a cut to a maximum 15 percent income tax rate on people like himself who made their principle income from sitting around the pool waiting for their dividend or capital gains checks to arrive in the mail – and blowing out federal spending. Bush even out-spent Reagan, which nobody had ever thought would again be possible.

And it all seemed to be going so well, just as it did in the early 1920s when a series of three consecutive Republican presidents cut income taxes on the uber-rich from over 70 percent to under 30 percent. In 1929, pretty much everybody realized that instead of building factories with all that extra money, the rich had been pouring it into the stock market, inflating a bubble that – like an inexorable law of nature – would have to burst. But the people who remembered that lesson were mostly all dead by 2005, when Jude Wanniski died and George Gilder celebrated the Reagan/Bush supply-side-created bubble economies in a Wall Street Journal eulogy: