The Innumeracy of the Republican Party
Even if we adopt the "Cut, Cap and Balance" plan, tax hikes are a necessity.
As Doug reported, John Boehner’s walked away from debt deal talks. In his letter to the GOP caucus, Boehner highlights the complete, innumerate nonsense that is the position of the Republican Party. Let me highlight two pieces.
The House this week passed such a plan…the Cut, Cap & Balance Act, which passed the House with bipartisan support.
The President is emphatic that taxes have to be raised.
I won’t get into the merits of the Cut, Cap & Balance Act — that’s been ably handled by my colleagues. I will simply point out this:
The Cut, Cap & Balance Act cuts spending to 18% of GDP and caps it there. It also demands that the budget be balanced.
But here’s the thing – Federal revenues are less than 15% of GDP thanks to Obama’s overzealous slashing of taxes. So even under the “Cut, Cap and Balance” plan, taxes need to be raised to match spending or else you’re looking at an over half-trillion dollar deficit.
The Republican position on taxes relative to the deficit simply makes no sense, either economically or mathematically.