Why Won't Republicans Discuss Raising Taxes?

Why won’t Republicans discuss raising tax revenues in their budget talks? There is an obvious, but overlooked answer. It’s not that the Republicans stand for lower taxes and smaller government, as they once did. But rather their reason is much more childish, simplistic, and sinister.

Despite the fact that George W. Bush, Jr. initiated the bank bailout known as TARP, Republicans and Tea Partiers demonized President Obama for its passage. The Troubled Asset Relief Program was a response to the sub-prime mortgage crisis, which not only was caused by a lack of regulations of our banks, but it was designed to purchases the toxic assets from our banks to prevent their bankruptcies. For the failure of our financial institutions would surely drive our economy reminiscent of the run on the banks in 1929. Our Great Recession would have been Great Depression II. Of course our banks used the money in other ways, such as automation, buying out smaller or less fortunate financial institutions, and paying out large CEO bonuses. The Republican’s Free Market approach did nothing to prevent this crisis or any future reoccurrences, but rather nurtured it. Without regulations, these banks were able to take over smaller banks, automate the foreclosure process, and payroll more lobbyists to fight regulations.

Ignoring the fact that George W. Bush, Jr. bailed out our automotive industry twice during his administration, Republicans attempt to crucify President Obama for the last Auto Bailout. Neglecting evidence that their free market approach has not worked in protecting one of Americans’ largest manufacturing industry, protecting millions of American jobs across the country, Republicans and Tea Partiers would rather have seen us lose our industry to overseas competition. But that is the Free Market approach, to allow failing companies who made poor business decisions, fail, despite of any economic hardships thrust upon the American people.

Rather than debating the Patient Protection and Affordable Care Act on its merits, Republicans and Tea Partiers decried this federal statute as a government takeover, instituting “Death Panels”, and as a job killer. Even though this act was based upon Republican proposals over the years, they denounce it as “Socialism”. Guaranteed enrollment in Health Insurance coverage is not a Socialistic approach. Insurance companies make out like bandits on this one. But then, Republicans and Tea Partiers alike cannot stomach the regulations put upon Health Insurance companies, which attempts to reduce the profits reaped by the CEOs through enforcing a certain portion of an insured payments go towards their health care.

The Republicans and Tea Partiers alike have blocked all federal appointees proposed by President Obama. As former GOP congressional aide Joseph Englehard said, “This isn’t about any particular appointee - Ben Franklin could come back to life and they would oppose him.” Or to paraphrase, this is not about ideology, but rather it is only about obstructionism and not allowing one single victory for President Obama.

Instead of protecting American Jobs, as the Republicans and Tea Partiers claimed was their so-called mandate in the midterm elections, they blocked job saving and job creating bills. They blocked a bill that would have eliminated the tax breaks on companies who ship jobs overseas, the jobs bill which would have offset payroll taxes on companies who hired new employees, and the Fair Pay Act of 2009 which would ensure women receive the same compensation as men for doing the same work.

But all of this points towards one agenda, one goal, and one honest statement from Mitch McConnell. The Republicans are not interested in governing, jobs, equality, protecting our failing economy, or even taxes. As House Minority Leader Mitch McConnell plainly said, their “number one priority is to ensure Obama is a one-term president”. And let there be no mistake about it, this has been their goal ever since President Obama was elected into office. Why else would the Republicans denounce policies which they once stood for?

Our Priorities

Our two unfunded wars, Iraq and Afghanistan, has topped $1 trillion. Our unfunded $160 billion tax cuts were signed into law, for which all other bills were held hostage for its passage. Our oil companies like BP and Exxon/Mobil can deduct from their taxes drilling exploration, oil recovery operations, percentage depletion allowances, passive investments, domestic manufacturing, foreign taxes, marginal well production, clean up costs, and fines. Our businesses like Walmart receive tax deferments and tax incentives from our local governments as incentives to come into our communities.

Our banking and financial industries speculated on our housing market, marketed and sold sub prime mortgages. They bundled and sold faulty mortgages as products, all of which led to our housing market crash. TARP program was initiated in November of 2008 and was intended to secure our large banks by purchasing “toxic assets” from our flailing banks’ balance sheets and avert repossession for struggling home owners. But before President Obama was sworn into office and just as critics feared, our banks and financial institutions are either hording the money or are using it to take over weaker rivals. Bank of America and Wells Fargo are able to forgo paying state and local income taxes. Wells Fargo is also able to forgo paying their federal income taxes as well. The cost of TARP was $2.9 trillion.

Representative John Boehner says, “We’re broke!” So in order to balance our budget, funding for certain programs must be cut. There are no funds available for low income heating assistance, Corporation for Public Broadcasting, EPA, the Health Care Bill, family planning, welfare, federal job training, high speed rail, climate change, energy reform, NASA, and National Institutes of Health. To further enhance our budget, GOP senators threaten to derail all bills that don’t cut the national debt.

Our police, firefighter, teacher, and other public unions are being scapegoated for budgetary shortfalls. Most notably, Governor Walker of Wisconsin blames collective bargaining and health care contributions for his state’s budget shortfall of $137 million. State Senator Erpenbach however, brought to light that Governor Walker gave away $150 million of business tax cuts.

With the National Deficit topping over $14 trillion, draconian cuts and austerity measures are being proposed. It is worth investigating where our money went. Precisely who are making sacrifices? Who are benefiting from these policies? Are “we broke” because of entitlement programs, or is it due to the multitude of tax giveaways to businesses?
　
-Silence Dogood


　
Sources:
-As Oil Industry Fights a Tax, It Reaps Subsidies, New York Times, 7/4/10
-”Free Lunch”, David Cay Johnston
-Paulson abandons plans to buy up America‘s toxic mortgage assets, Guardian, 11/13/08
-No Taxes for Bank of America ((NYSE: BAC) and Wells Fargo (NYSE:WFC), American Consumer News, 3/29/10
-Boehner: “We’re Broke”, Politico, 2/10/11
-GOP leaders forced to deepen proposed budget cuts, Chicago Tribune, 2/11/11
-GOP Reveals Plan for Deep Cuts to EPA, Job Training and More, CBS News, 2/9/11
-GOP Senators Threaten To Derail All Bills That Don’t Cut Debt, Huffington Post, 3/10/11
-The Wisconsin Teachers' Crisis: Who's Really to Blame?, Time, 2/18/11
-What's at Stake in Wisconsin's Budget Battle, Online WSJ, 2/19/11
-Lawmaker: Gov's plan has torn Wisconsin apart, CBS News, 2/19/11

Smaller Government At What Cost?

The Tea Party and Republicans are moving forward on their agenda for a smaller government. But what does this mean to us, as Americans? Their theory goes, with a smaller government, less taxes will be needed to be collected. Since Americans have an aversion to taxes, the general public tend to go along with this theory.

But this isn’t as much of a theory in so much as it is rhetoric. The federal government has obligations, established over fifty years ago, in order to help provide for those who can’t provide for themselves. Whether we are discussing the retirees, the disabled, or the unemployed, the Tea Party and Republicans tout personal responsibility.

It is one thing to talk about reducing the federal government’s budget or obligations by reducing it to simple numbers. But they haven’t been holding honest discussions. The federal deficit is not a new issue, nor is it something to be ignored. Yet as the Tea Party and the Republicans both accurately state that our federal government is broke, they fail to take note of how the Tax Cut bill brought this about.

The tax rates we are currently enjoying was brought about while acknowledging that these rates will not be sustainable. They were brought about to promote economic growth at a time of stagnation. While many American businesses relocated production and manufacturing overseas, lower tax rates were touted as a spark to demand. These tax cuts were not budgeted for, but rather were financed through our national deficit.

But what does this all mean for Americans today? While there was a so-called “mandate” for even lower taxes and a smaller government, the Tea Party and Republicans are seeking to de-fund essential programs such as Social Security, Medicare, Medicaid, and Unemployment. The programs they seek to cut financial corners out of will effect our retired, our disabled, our unemployed, our under-employed, and our poor.

In order to maintain the tax cuts for the upper 2%, it is the poor who shoulder the burden through the de-funding of heating assistance, food programs, Medicaid and education. Retirees will shoulder the burden through the cuts to Social Security and Medicare. While the discussion centers around how “we must all shoulder the burden” in order to balance the budget, it is not the wealthy who are shouldering the burden, or who are making sacrifices. Instead, they are only asking the poor to shoulder the burden.

I find myself in agreement with the Tea Party’s and the Republican’s talking point of personal responsibility, or to paraphrase “if you can’t afford it, you don’t deserve it.” We can’t afford these tax cuts when our deficit is closing in on the GDP. So instead of scraping pennies off of the backs of those who can not provide for themselves, why can’t we have an honest discussion over how these tax cuts are unaffordable, and that the upper 2% don’t deserve them?

It is called “wealth redistribution” when you take money from one economic class and give it to another (which is typically done through tax cuts and tax incentives). Wealth redistribution is only demonized when it effects the upper class and it is touted as being “responsible” when it effects the lower classes. Wealth redistribution works both ways. For over thirty years, money has been redistributed from the lower and middle class and given to the upper class. The last three tax cut measures were not budgeted for, but rather were financed through our national deficit. Therefore, we find our government is “broke”, and we can no longer afford Social Security, Medicare, Medicaid, Food Programs, Heating Assistance, Planned Parenthood, Public Schools, Police protection, Fire protection, and other programs designed for either the public good or for those who can no longer provide for themselves, in order to permit those who have enough to gain more.

This approach is irresponsible and devastating to the American economy. We are left to wonder, what are the costs to us in order to reduce the size of the government and lower the tax burden? We may find that the costs are more than we are willing to stomach.