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Friday, April 20, 2007
OMB's Portman Still Drinking the Kool-Aid
Rob Portman is in the Hill today, doing his best to spin the Congressional budget resolutions.
One of his comments stands out:
I'm disappointed that the budget pays for all that new spending with taxes, which I think will put at risk the very economic growth that has given us the increased revenues over the last few years to be able to reduce the deficit.
I'm not exactly sure what spending he's talking about. But anyway. The main point is that he's probably wrong about the macroeconomic affect of the tax cuts. Even the Bush Treasury Department doesn't think expired tax cuts will put long-term economic growth at risk. Why should anybody take Rob Portman's word over theirs?
Let's also not forget that economic growth in the last few years has not done wonders for the country. It's only been the wealthiest people who've done better. So the revenue from the expired tax cuts could be used to help regular people who otherwise wouldn't get much in this top-heavy economy.
For instance, some of the revenue could be used to reform the health care system so it doesn't cost people and the government so much money. This is a pocketbook and a budget issue, but it also has a lot to do with macroeconomics. People from all over the political and ideological spectrum, including Portman, warn that health care costs could harm the economy. They could drive up the deficit to unsustainable levels. And if health care spending takes up too much of our GDP, we'll have less money around to spend on more other things.
Health care reform is going to cost a lot up front. But unlike renewing most of the tax cuts, it might actually make a significant and positive impact on our economy.
Posted by Matt Lewis
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