|
Tuesday, March 20, 2007
CBPP: Tax Cuts Bad For The Economy
The Center on Budget and Policy Priorities is arguing that repealing the tax cuts would be good for the economy.
Bush & Co. like to claim that the tax cuts are magic, and that failing to extend them will be a disaster for the economy. They're wrong, and it's great that CBPP is pointing this out.
But this new paper seems to suggest that the repealed tax cuts should be devoted entirely to deficit reduction because reducing the long-term budget imbalance would be good for "the economy." But what if we repealed the tax cuts not only to reduce the long-term imbalance, but to pay for new programs that counteracted the trend toward greater inequality?
I mean, who would a more sound "economy" be good for? Growth these days doesn't seem to be too evenly distributed, as CBPP has documented so well. Any marginal increase in economic growth due to the repealed tax cuts would probably go to the same people that have done well the last 30 years- the top 10 percent of earners, particularly the top 1 percent.
One final thought- the subtext here is that increased revenues are somehow the solution to the long-term budget imbalance. More revenues may be necessary- but what matters more is what they're paying for. The cause of the long-term budget problem is our overpriced and inhumane health care system. What we need to pay for is a fundamental restructuring of the health care system that addresses long-term costs.
Posted by Matt Lewis
|