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Free Minds & Free Markets

House Republicans Want Permanent Tax Cuts They Can't Pay For

GOP legislators released their "Tax Reform 2.0" proposal, which aims to make last year's tax cuts permanent, adding trillions to the $21 trillion debt.

Aaron Bernstein/REUTERS/NewscomAaron Bernstein/REUTERS/NewscomRepublican lawmakers on the House Ways and Means Committee on Tuesday released a proposal to make permanent last year's tax cuts, which are currently set to expire in 2025.

Without a plan to cut a commensurate amount of federal spending, the so-called Tax Cuts 2.0 package could add trillions of dollars to the national debt during the next few decades. Extending the tax cuts would reduce annual revenue by about $165 billion, according to an analysis from the Tax Foundation.

Without a balanced budget in sight, the national debt, currently $21 trillion, will continue to rise, and the rate of increase will also rise. According to Congressional Budget Office projections, the 2017 Tax Cuts and Jobs Act will add $1.5 trillion to the national debt over the next ten years, even after economic growth is accounted for. But that's only if Congress lets the tax cuts expire in 2025. If that does not happen, higher deficits will plunge us into further unsustainable debt well after 2025.

"The further we go down this road, the more catastrophic the inevitable U-turn will be," Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a Washington, D.C., group that favors balanced budgets, said in a statement. "The irresponsibility is just baffling."

The expiration date for the personal income tax cuts was widely regarded as a gimmick that was included in the tax cut bill to game the CBO analysis. Without that gimmick, the CBO projections would have shown a much larger increase in the national debt. But Republicans never intended to let the tax cuts lapse. "Those are sunsets that will never occur, we don't believe will ever occur, we don't intend to ever occur," Speaker of the House Paul Ryan (R-Wis.) said last year as the bill was being debated.

The House GOP plan to extend the tax cuts includes the creation of tax-free "universal savings accounts," aimed at encouraging people to save for retirement. The proposed changes would also allow individuals to crack open their retirement accounts without penalty whenever they have a new child.

The plan would expand 529 education accounts so individuals can "use their education savings to pay for apprenticeship fees to learn a trade, cover the cost of home schooling, and help pay off student debt." Finally, the framework suggests increasing the costs startup businesses can write off to reduce barriers to entry.

If the tax cuts were offset with spending cuts, Tax Reform 2.0 could be a step in the right direction. Taxes discourage work and investment while directing money from productive sectors of the economy to the government. Letting Americans keep more of the money they earn is therefore good policy. Universal savings accounts in the United Kingdom and Canada have been very successful at encouraging people to save for their retirement. Nearly half of all Canadians opened accounts within six years after they were authorized.

The Tax Cuts 2.0 proposal looks like election-year bait for the conservative base—a way to let them know that Republicans still pay lip service to small-government ideals, even if they're unwilling to be fiscally responsible once they are elected.

Photo Credit: Aaron Bernstein/REUTERS/Newscom

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  • Fist of Etiquette||

    "Tax Cuts They Can't Pay For"

    That's going to generate some comments.

  • Libertymike||

    Yup.

  • Get To Da Chippah||

    Well it makes sense. All money, and by extension anything of value, ultimately belongs to the government. They, in their benevolence, just decide how much of their stuff you get to borrow for your own use.

  • Tony||

    Because libertarians for all their nerdy bean-counting posturing can't figure out that a ledger has two columns?

  • sparkstable||

    Let me make this clear:
    A reduction in INCOME is not the same as an EXPENDITURE.

    Only expenditures must be "paid for" as paying requires an outflow of monies. A reduction in income only limits one's ability to pay out for other expenditures, but is not an expenditure itself.

    Taxes are an INCOME to the government as they are extracted FROM others TO the state. Those monies are first the property of the people who earned them THEN that property is claimed by the state (legally/illegally, justly/unjustly... not getting into that here). If the state claims LESS income from a source, that does not require a PAYMENT of anything. Walmart isn't PAYING you when they lower the price of a good... they are simply extracting less from what is already yours at the start.

    THUS... no tax cut can ever be paid for no matter how hard you try. It is a logical impossibility. As such, to think of the world in such a way is to deny rational thought, without which, by the way, you can not have science (I point this out because of the irony it brings when thinking about the "party of science" crowd).

  • Tony||

    A reduction in INCOME is not the same as an EXPENDITURE.

    According to math it is.

    You're conflating math with morality, as you all do.

    They're two separate conversations. We can talk about not paying for tax cuts and we can be grownups and understand what that means, math-wise (it means not reducing expenditures, duh).

    And we can also have a conversation about the moral permissibility of taxing people. That one happens a lot here.

  • Just Say'n||

    Maybe you can teach your advanced math to IL and NJ, because your ideas don't seem to be doing so well there

  • Tony||

    Not everywhere can be a paradise on earth like Alabama.

  • Just Say'n||

    Ironically, AL population is still growing, unlike NJ and IL. And there's your Laffer Curve

  • Rev. Arthur L. Kirkland||

    Alabama is a political, cultural, economic, moral, and educational drain and stain on America. A strong argument for making it an unincorporated territory in the wake of the Civil War has been generated by 150 years of experience.

  • Just Say'n||

    You're a sad human being

  • gimmedatribeye||

    Says who? You? And who are you again?

  • Sevo||

    Rev. Arthur L. Kirkland|7.26.18 @ 8:53PM|#
    "Alabama is a political, cultural, economic, moral, and educational drain and stain on America. A strong argument for making it an unincorporated territory in the wake of the Civil War has been generated by 150 years of experience."

    And you are a pathetic excuse for a human, asshole.

  • Rev. Arthur L. Kirkland||

    I am content, Sevo, knowing that as pathetic as I might be, I will always be your better.

  • Kivlor||

    I think Tony is actually making a decent point--although I'm not sure if it was by design or not--in that, to a certain degree, the libertarian objection here is semantics. We aren't talking about taking a sudden unexpected cut to your income, but rather intentionally reducing it. Now, if you are going to intentionally reduce your income, and you're already spending all you make, you're going to have to find a way to "pay" for that shortfall. Which will necessarily mean reductions in spending--something that libertarians should be advocating for.

  • Social Justice is neither||

    But that's saying that if you dramatically increase your spending you've taken a pay cut...just no.

    You can't enable a spending addiction and think you're going to be able to make reasonable steps to correct the behavior you're actively enabling.

  • John C. Randolph||

    we can be grownups

    Fuck off, slaver. You looters always adopt this snotty posture of pretending that you're more sophisticated than the earners.

    -jcr

  • Rev. Arthur L. Kirkland||

    Fuck off, slaver. You looters always adopt this snotty posture of pretending that you're more sophisticated than the earners.
    -jcr

    You are an apt spokesman for America's morally deficient, economically inadequate, gullible, inconsequential right-wingers, jcr. So long as your betters must subsidize the likes of you, and generate progress against your efforts and wishes, your mutterings are pathetic.

  • sparkstable||

    If you analysis is correct then it would be appropriate for me to say I have yet to figure out how to pay for the one million dollars you haven't given me. After all, if it is only math then it doesn't matter what order the concepts occur in the real world as addiction and subtraction is all that is happening.

    But that is an irrational statement that does not reflect reality and is therefore definitively wrong. The ownership aspect of property is not captured with mere "math" thus making more "math" an inadequate means by which to analyze the problem. You need qualitative AND quantitative expressions to accurately capture what is happening with expenditures and incomes.

    Thus... again... it is impossible to pay for a reduction in income even if the end result is similar (but not exactly like due to the quite different nature of such a scenario) to an expenditure.

  • Longtobefree||

    Please do not reply to Tony; I have carpel tunnel, and scrolling through the inevitable madness that follows a reply to him really hurts.

  • Happy Chandler||

    I seem to remember a different reaction when the tax cut in question was the proposed rent credit from Senator Harris.

  • NotAnotherSkippy||

    And an even bigger reaction when SALT deductions were limited. Why aren't you doing your patriotic duty?

  • NotAnotherSkippy||

    Medicare for all.

  • Diane Reynolds (Paul.)||

    You're going to generate some comments.

  • Fist of Etiquette||

    YOUR FACE IS

  • esteve7||

    what a fucking abortion of a headline from a 'libertarian' site. You don't pay for tax cuts, you pay for spending. the government doesn't own you or your money

  • PaulTheBeav||

    Tax cuts don't have to be paid for. Only spending has to be paid for.

  • Rich||

    Well said.

  • Hugh Akston||

    Republicans can't do that right either.

  • Social Justice is neither||

    And Democrats can't even be bothered to try. Still slavers after all these years.

  • Just Say'n||

    Yeah, Republicans are fiscally irresponsible, but that's always been the case. At the federal level, at least, since they're more limited in piling up debt on the state level.

    But, I am perplexed by "taxation is theft" being morphed into "taxation is theft, only if the budget is balanced".

  • Just Say'n||

    Speaking of taxation....

    www.twitter.com/social_caucus/.....5048353795

    "Taxation is theft when it is co-opted by undemocratic oligarchs to pay debts created through corporate welfare & corruption. Revenues to a communal fund whose spending priorities are voted on by contributors is a much wiser model."

    Not as punchy of a catchphrase

  • DiegoF||

    I can't decide whether to get the snapback cap or the bumper sticker.

  • DiegoF||

    Also, I can't parse. Are they saying the "contributors" will be voluntary? If so, why the need for all the (apparently qualifying) verbiage? Isn't this just everyday "taxation is theft," since said moral status proceeds entirely from its involuntary nature? And if not...don't "contributors" already nominally do this, in at least an indirect sense, under the current system? Isn't this a description of democracy?

  • DiegoF||

    ...Now that I look at it, perhaps a hint toward the latter point is the talk about "undemocratic" oligarchs (whatever the fuck that means). Perhaps the quarrel with the current system really is that they feel it is somehow "undemocratic." In that case it is unclear what they are doing in a Libertarian Party; it seems they should really be forming some sort of democratic-reform movement, of which there have long been plenty worldwide. They may be using the LP in a sort of entryism, hoping to take it over for unrelated goals in order to use its mighty apparatus.

  • Just Say'n||

    They start off OK and then get weird

  • EscherEnigma||

    Don't know. From my perspective, y'all have never been consistent. After all, "taxation is theft", but me paying lower taxes is a "subsidy".

  • Tony||

    Taxes discourage work and investment while directing money from productive sectors of the economy to the government.

    Funny because when I have less money I feel incentivized to make more of it. Also, being educated and having roads is a great boon to my investment strategy, as I can navigate a functioning civilization without being illiterate or walking through mud to get everywhere, which is surely an important first step.

  • Just Say'n||

    Public schools and the vast majority of roads are not funded by the federal government

  • Tony||

    Okay, not being beaten by the Nazis has also helped my portfolio. Whatever.

    State and local governments are governments too, you know.

  • Just Say'n||

    Yeah, but state and local governments can't pile up debt like the federal government. You'll learn that someday. Lord knows that Illinois and New Jersey are learning that the hard way

  • Tony||

    You wouldn't want to live here if the federal government couldn't take on debt.

    Agreed that Republicans like to test the idea to its limits, though.

  • Just Say'n||

    For a guy who loves government so much, you don't seem to grasp what the different layers of government actually do

  • Don't look at me.||

    So some is good? What is the limit?

  • Tony||

    Let's hope we don't find out. Elect Democrats.

  • Last of the Shitlords||

    Why Tony? So we can watch THEM overspend and bankrupt the country?

    'yeah, right. Go fuck yourself.

  • Ron||

    I live in a town where many of the roads were originally built before there was a government here. the miners wanted the gold so they made the roads. the anarchy of a bunch of people with a common goal making actual roads and even the local electric utility was created by the miners. you may have heard of it, its name is PG&E

  • Tony||

    I can get from one coast to the other more or less without stopping thanks to the feds, though.

  • Diane Reynolds (Paul.)||

    No, that's thanks to the taxpayers who have skin in the game.

  • Tony||

    What are we even talking about here.

  • Diane Reynolds (Paul.)||

    What are we even talking about here.

    Your mom.

  • Ron||

    so did the miners without the feds. sometimes they ran into hostile people but that was their choice of risk

  • Ron||

    and the railroads didn't get started until after the miners spent their money building towns and President Lincoln decide he wanted all that gold for the governments war on the south so he had railroads built to California as a means to an end

  • Tony||

    war on the south

    And think how productive you could be without a government telling you not to own slaves.

  • Ron||

    I don't really give a shit about the civil war but that is why Lincoln ordered the transcontinental railroad. learn history.

  • Ron||

    Tony
    you do realize that many people form the north and south voluntarily did not have slaves without the federal government telling them not to. Do you believe nothing happens without the government say so, can you wipe your own ass without government permission? or is your head in the way of that too

  • Tony||

    So slavery would have gone away just as quickly without the Civil War? What did we fight it for then?

  • Ron||

    So slavery would have gone away just as quickly without the Civil War? What did we fight it for then?"

    Its possible with the right economical incentives but we will never know that now.

  • Earth Skeptic||

    Yes, since "economic sanctions" is how the right-thinking people get things done.

  • Get To Da Chippah||

    The Industrial Revolution would have ended slavery without the need to kill hundreds of thousands of people.

  • markm23||

    If that was the reason, it sure didn't work out well. The enabling act was passed in 1863, but Union Pacific didn't even start work on the eastern part of the railroad until April 1865 - that is, when Lee surrendered, Richmond was occupied, Jeff Davis was on the run, and the Union could free up a little manpower. All the skilled railroad construction workers on the Union side east of the Great Plains were busy repairing and building track to supply the Union armies. The southern railroaders weren't very busy due to a lack of iron for rails, but weren't flocking to Omaha in undisputed Union territory for jobs. And the huge unskilled crews the UP also needed mostly came from discharged Union soldiers.

    The Central Pacific may have got started earlier on the western part. There was no war in California, and their work crews of a few experts and a lot of Chinese laborers were easier to hire during war time - and they had more mountain ranges to cross, so they needed the earlier start.

  • sparkstable||

    Simply because an agency created something one time does not mean that that agency is therefore and always the only possible source of said thing. If so... then only cavemen could ever provide us with fire (save theft or fraud). Only Guttenberg could provide us with mass copies of printed material (save theft or fraud). Only Ben Franklin could supply us with bifocals.

    PLUS... I have WORSE roads when I travel public roads as compared to the toll roads that are (quasi) privately owned (that's another story altogether... but the fact remains that toll roads are a vastly superior quality).

  • Fuck you, Shikha (Nunya)||

    Oh, look. Tony capitulates and says his "logic" was found entirely void of rational thought. However, he then proceeds to say it doesn't matter because "nazis". Are you that crazy haired Aliens guy from the history channel?

  • Just Say'n||

  • DiegoF||

    If you drink enough Anheuser-Busch disaster water you may be able to begin to wash the taste of Domino's Pizza out of your mouth.

  • Just Say'n||

    Dominos tastes like the tears of people who cry "muh, roads"

  • DiegoF||

    In that case their tears taste like shit. Very disappointing since tears of others are normally so yummy.

  • Just Say'n||

    Eh, tears are an acquired taste

  • DiegoF||

    I am digging this wildcat alternative to "road sponsorship." If the Klan is really smart they will slap some orange tape on their hoods and get out there and start laying some asphalt. Cut out the Zionist Occupied Government and their antiwhite bigotry entirely.

  • Just Say'n||

    WTF?

    I got admit I didn't expect that insane remark. Ok, then

  • DiegoF||

    That was a joke you doofus. It's a reference to the very prominent controversies where the KKK was sponsoring roads a while back to get their names on the signs and states had to scrap the program because there was no Constitutional way to avoid it.

    Come on how long have I been commenting? Am I a Puerto Rican Klansman or something? And I think I may have ridden you at one point for being anti-Israel.

  • Just Say'n||

    I suck at getting humor. My apologies

  • DiegoF||

    So do I to be sure! At least on the Internet.

  • BestUsedCarSales||

    I like both Budweiser and Domino's...

  • perlchpr||

    Given the rumors of your taste in porn, this doesn't surprise me.

  • DiegoF||

    I admit I have not tasted their pizza since the much-publicized reformulation.

    It's really not so awful that I'd begrudge most of America for buying it. To my knowledge this country might as well be England as far as pizza is concerned outside of the Providence-to-Philly corridor and Chicago. (You might think a prominent Italian-American community would be all it takes, but St. Louis begs to differ.)

    I've had Pizza Hut though, and I have to admit I kind of dig it. So I really can't see why anyone, anywhere, would order Domino's. Since I think Pizza Hut has delivery now.

  • BestUsedCarSales||

    It's just cheap. There's better pizza, but in the 5 dollar range it's pretty solid. I also liked St. Louis pizza though.

  • Rev. Arthur L. Kirkland||

    Pizza Hut? Fried dough designed to please four-year-old palates? I recommend moving to a civilized community.

  • Robert||

    Paving pizza? Must be stale ones!

  • Get To Da Chippah||

    Funny because when I have less money I feel incentivized to make more of it.

    Really? So if your taxes were to be doubled, you would work twice as hard as before to make up the difference? Because if that's the case for the population at large, a 0 tax rate should make America infinitely productive.

  • Get To Da Chippah||

    Alternatively, someone could just arrange to mug you each payday.

  • chemjeff radical individualist||

    Ooo! Ooo! Can I volunteer?

  • Tony||

    A conversation about taxes is not suited to all-or-nothingism. At some point Laffer effects do indeed kick in. Just not at any rate taxes are going to be at in at least the next billion years.

  • Get To Da Chippah||

    Er, a 0 tax rate.

  • Get To Da Chippah||

    A One hundred percent tax rate. Apparently the squirrels despise that symbol.

  • Mickey Rat||

    Up to the where the mark...er...taxpayer realizes it is a sucker's bet and what it takes to earn that extra dollar is not worth the effort.

  • NotAnotherSkippy||

    Great, then we don't need any welfare programs because you'll have less money and will go work (actual work) to make more of it.

  • sparkstable||

    Nuh-uh. Cause reasons. Why do you hate poor people?

    /sarc

  • John C. Randolph||

    when I have less money I feel incentivized to make more of it

    Bullshit.

    -jcr

  • Rich||

    higher deficits will plunge us into further unsustainable debt

    "Unsustainable." "You keep using that word...."

  • Rich||

    "The further we go down this road, the more catastrophic the inevitable U-turn will be,"

    Serious question: What *exactly* will this "U-turn" be?

  • Diane Reynolds (Paul.)||

    More debt. I have it on good authority that we wouldn't want to live here if the feds couldn't take on more debt.

  • Aloysious||

    More debt.

    Only if it is eco-friendly unsustainable debt. Sustainable debt is not eco-friendly, and therefor unsustainable wrongungoodNazithink..

  • NotAnotherSkippy||

    Explicitly turning SS into welfare with a flat benefit for all and lifting the earnings cap. Continued capping of Medicare payments to below the cost of service with mandatory acceptance for providers. Limitation on allowed drugs/procedures based on government standards (aka death panels with exemptions for the more equal animals of course).

    And debt.

  • Rich||

    And chaos?

  • Earth Skeptic||

    And zombies.

  • Hamster of Doom||

    If there isn't also hookers and blackjack, we should write strongly worded letters to our representatives. Quality epochal events, or GTFO with this half-arsed collapse-of-Roman-empire... that wasn't even medieval times, we are WAY better than that.

  • Ken Shultz||

    "Without a plan to cut a commensurate amount of federal spending, the so-called Tax Cuts 2.0 package could add trillions of dollars to the national debt during the next few decades."

    Because governments can't stop themselves from spending, the best way to make them spend less than they would otherwise is to cut their income.

    The solution to drunken sailors spending all of our money certainly isn't to give them more of our money to spend.

    Is there anyone here so retarded as to think that if only the government had more of our money to spend, they would spend less? Is there anyone here so fucking retarded that they imagine the government will someday become so flush with cash that they decide not to spend it?

    Let's grow up and stay that way.

    The government will never stop spending until it has no other option. Cutting their income gives them even fewer options--and that's a good thing.

  • Tony||

    That's worked great so far.

    And that was always the plan. But Republicans want Democrats to have to do the cutting so they don't get their hands dirty. Unfortunately for them, it's never actually forced, and the debt just keeps piling up. And they keep calling themselves the party of fiscal responsibility, because it's all a big joke to them or something.

  • Don't look at me.||

    A minute ago debt was good. How much is too much? Do you have a number?

  • Tony||

    Go read up on some basic Keynesian (or "mainstream") economics.

  • Just Say'n||

    Haha

  • esteve7||

    I think the word you're looked for is failed or discredited

  • Last of the Shitlords||

    Stupid Tony referencing voodoo economics. Stupid Tony has no concept of economics.

  • Earth Skeptic||

    So, what does Krugman's dick taste like?

  • Tony||

    I'm serious you can just wikipedia mainstream economics. It is what it says it is. Have you thought all this time that your silly horseshit was accepted by the mainstream? Surely not.

  • sparkstable||

    Geocentrism was mainstream at one point. Consensus and correct are correlated, they do not necessarily have a causal relationship. Keynesian economics preaches, literally and not figuratively, that the dynamism in the economy is from, and I quote, "animal spirits."

  • Tony||

    Are we not animals?

  • NotAnotherSkippy||

    It would be nice if the democrats were willing to cut anything that matters, but socialists like you scream whenever you're forced to support yourselves.

  • Tony||

    We want to cut defense, but their lobbyists are much more powerful than the ones for the starving grandmothers you want to punish.

  • NotAnotherSkippy||

    Cut defense to zero and we still go broke thanks to your entitlement programs. Yes, this is 100% at the feet of you socialists.

  • EscherEnigma||

    Yes, this is 100% at the feet of you socialists.
    If by "you socialists" you mean "vast majorities of Americans irrespective of political party", then sure.

    If by "you socialists" you mean "democrats", then you've vastly underestimated the popularity of Social Security and Medicare.

  • NotAnotherSkippy||

    Good thing we invented time travel to take us back to the Great New Deal when the behemoth was made. On the other hand, you haven't been paying much attention to democratic primaries lately or the Medicare for All Caucus.

  • Trollificus||

    Now, I hate starving grandmothers as much as the next guy, but I've read this whole thread and nobody has explained the part of the plan that involves the acquisition of the underpants. WTF?

  • Last of the Shitlords||

    "We want to cut defense,"

    What a fucking surprise. Stupid Tony

  • Ron||

    Ken's answer should be shared with everyone who thinks more taxation means less government.

  • DiegoF||

    I think this is essentially the outlook popularized by Norquist. The government can and does continue to push the burden of spending ever further out to future generations; but the thought is that eventually they will have to stop, and pull back, and will pull back by cutting spending rather than increasing taxes.

  • NotAnotherSkippy||

    Cutting spending is the only solution. Every tax increase is spent.

  • DiegoF||

    Yes but sometimes by past spending, as when the Federal deficit is reduced by raising taxes and not raising current spending. Obviously spending cuts are where it's at, period.

    I find this "paying for tax cuts" language bizarre, unhelpful, obfuscatory, and very prog-enabling. But I don't really see what's wrong with pointing out, "If you cut taxes but not spending, you aren't really cutting taxes; someone will have to pay for that spending in the future."

  • Vernon Depner||

    But paying for it might only amount to telling our creditors to fuck off. Or killing them.

  • NotAnotherSkippy||

    Any deficit reduction due to a tax increase is eaten up within a max of 5 years and then it dips red again. The only sustainable deficit/debt reductions are on the spending side. Clinton's "surpluses" were due entirely to spending restraint, even though they completely ignored the real problem of unfunded liabilities of the welfare state.

  • Trollificus||

    Clearly, the answer is a dramatic increase in immigration. Or have I misread REASON this last year or so?

  • Social Justice is neither||

    And not just spent but spent at multiples greater than 1 for every planned dollar increase.

  • Ken Shultz||

    Eventually, what happens is what happened to Greece.

    The world's investors are no longer willing to finance their deficit spending at an interest rate they can afford to pay. The taxpayers either won't or can't pay any more without hurting the economy so bad that raising the tax rate isn't worth it.

    With no prospect of higher taxes coming in and the interest on debt being more expensive than we can afford, there will be no choice left but to cut spending. Even in that situation, the people of Greece wouldn't believe it. They kept kicking out prime ministers for telling them the truth--you can't get blood from a turnip.

    Then they started blaming Germany for demanding that they cut spending in return for financing their debt at below market interest rates. When this happens to the U.S., however, the EU, China, the IMF and the rest of the world put together won't be big enough to bail us out. There will only be massive spending cuts.

  • Echo Chamber||

    Or massive Fed intervention
    Print baby print

  • Ken Shultz||

    See below.

    If the fed raises rates, the economy contracts, less tax revenue . . .

    That will help entice fiscal conservatives to cut spending.

    . . . after others and the Democrats squander more of our debt on "stimulus".

    Japan has been trying to stimulate their economy for how many decades now? Since 1990 or thereabouts?

  • BestUsedCarSales||

    We're about 30 years into the Lost Decade.

  • Last of the Shitlords||

    How much can we get for debt reduction by vivisecting and harvesting all the organs in every progressive in America?

  • Rev. Arthur L. Kirkland||

    You keep fantasizing about acting on your resentment toward your betters, while they continue to shove progress down your submissive, whimpering throat.

  • Last of the Shitlords||

    Arty, such imagery. You must be imagining a whole haunch of beef.

  • Trollificus||

    At some point, won't inflation start to seem like a good debt-reduction plan?

    Bet we could get a bunch of those 100,000,000,000$ ZWD bank notes from Zimbabwe at a discount way less than the printing cost. They were the result of looking for a policy that would produce something of so little value that the government wouldn't steal it. SCORE!

  • Ken Shultz||

    There are a couple of ways to avoid that scenario. One, cut spending. Eventually, we'll have to do it when we go over cliff (wherever that is) anyway, but if we do it now, we can minimize the pain to the elderly, the poor--and everybody else--by being selective and cutting what we want. The other way to avoid that harsh scenario is that we grow the economy faster than we accumulate debt.

    Both ways of avoiding the spending crunch scenario involves cutting taxes. Cutting taxes makes the economy grow more than it would otherwise. Cutting taxes limits the available funds for our politicians to spend. And higher interest rates discourage further spending.

    People forget how necessary it was when Volcker came to the Fed and brought rates up to near where the market was. That was necessary to bring inflation under control. High interest rates aren't meant to be avoided at all costs. But when the market rates on debt and inflation are demanding high interest rates, ignoring those screaming signals is an incredibly stupid thing to do.

  • Ken Shultz||

    We've benefited greatly from being the prettiest horse in the glue factory since the Asian Flu in the 90s and the debt crises of 2008+, but never forget that we're still in the glue factory. Lowering taxes is the first step to getting out. Refusing to budge on higher taxes is the way to force the government to spend less money. There is no other reasonable way forward--except a Ross Perot style grass roots campaign for fiscal conservatism.

    I'm trying to imagine that latter scenario happening with Baby Boomers on Medicaid and Social Security and Millennials clogging up the demographic drain. Other than libertarians, who wants less spending?

    We need more libertarians.

  • Giant Realistic Flying Tiger||

    The generation following Millenials at the moment looks more conservative than them–a lot more conservative (given the current left-right spectrum). Granted, that could change, but the Millenials have probably helped to toxify the left in the minds of a lot of the next generation.

  • Last of the Shitlords||

    Good analysis Ken. The problem is that a lot of good people are just simply overwhelmed and just won't bother to pay attention to this problem. Plus we have all the democrats, who are pretty much like Tony. They just talk smack about republicans overspending and then say we can cut defense. Which they say will solve the problem when it won't.

  • JeremyR||

    While I agree, at the same time, the government is a drunken sailor with a credit card issued by himself, that other businesses accept without question

  • Ken Shultz||

    Cutting taxes is cutting them off.

    As interest on existing debt rises, it squeezes out other spending. If the taxpayers won't budge, then their credit card effectively gets revoked.

    We couldn't finance our current spending levels at 12% interest. It was up near there as recently as 1985.

    People don't finance the U.S. government without question. If they did, interest rates wouldn't fluctuate the way they do. Every day, somebody decides not to buy U.S. treasuries because the yield isn't high enough. That's at 3% on a ten year treasury right now. When the U.S. can't entice people to buy enough of our debt at a 12% yield, the government will turn to higher taxes to make up for the shortfall. They won't really cut spending until they fail to get the voters to cough up more in taxes.

    Always refuse to pay more in taxes. When they drag out droopy-eyed armless children starving in our streets for lack of taxpayer money, ask them why they spend money on space exploration and sending more kids to get college degrees in cultural anthropology. Once tens of thousands of federal employees are blocking access to the House like the state employees did to Scott Walker in Wisconsin, we'll know that our fiscal problems are finally being addressed. Until then, we should encourage our fellow Americans to forget about giving the asshats more of our money to spend--or until the cows come home.

    More tax revenue?

    How bout, "Fuck you, cut spending" instead?

  • Earth Skeptic||

    Yeah, but like a drunken ex-wife you have to also take away the credit cards.

  • JFree||

    The solution to drunken sailors spending all of our money certainly isn't to give them more of our money to spend.

    Apparently the solution for R's is to keep re-electing them - and the drunker the better.

  • Ken Shultz||

    And, yet, there they are--cutting taxes.

  • Weigel's Cock Ring||

    A fair and reasonable piece. Too bad Reason would have way more credibility if they didn't

    1) Oppose the proposed bill about a year ago that would have substantially cut Medicaid spending.
    2) Argue for expanding the welfare state via a "universal basic income".
    3) Mostly suck Obama's dick while the national debt was increasing $9 trillion during his eight years in office.
    4) Claim that the republicans should cave into all of Obama's demands rather than "shut the government down' while #3 was taking place.

  • NotAnotherSkippy||

    5) Continue to promote the myth the defense spending is the problem and not unfunded entitlements or taxes which, even with the cuts, are higher than the post war average %gdp.

  • Vernon Depner||

    Defense spending is a significant part of the problem.

  • NotAnotherSkippy||

    Defense spending is not part of the problem. Cut defense spending to zero and we still go broke. Cut entitlements to zero and we don't. Now if you want to make the case that cutting defense would let you keep more of the welfare state, then make that point. But drop the other bullshit.

  • EscherEnigma||

    Cut entitlements to zero and we […] just cut off the primary source of income for a huge chunk of 65+ Americans and the medical insurance for even more. The people most affected (the already retired) will be the least able to benefit from the lowered taxes and least able to develop effective coping strategies.

    And it's not like the 9.4% increase in take-home pay (6.5% for Social Security, 2.9% for Medicare. Employers wouldn't pass along their savings unless they were somehow required to) is going to cover the increase in family expenditures if all the senior citizens suddenly have to move in with their kids with no or minimal income.

    So sure. The US may not "go broke" if you cut all entitlements to 0. But if you cut all entitlements to 0, you will break America.

  • NotAnotherSkippy||

    So what was that you were saying about not being a socialist again?

    I realize that math hurts your feelings. I realize that it's ugly when a junky has to get clean. That doesn't change reality. And the reality is that there is not enough money to pay for your feelz. And that 9.4% is really 15.3% irrespective of your greedy capitalist running pig dog rhetoric.

    We'll just put aside your stupidity assuming that the programs are zeroed out instantaneously (hint: they need to be sunsetted). To continue the junkie analogy, what is needed is a methadone program to ween us off. And the sooner we start the better regardless of your pearl clutching.

  • EscherEnigma||

    So what was that you were saying about not being a socialist again?


    That by your definition most Americans are socialists. Kinda devalues the term, but whatever lifts your luggage dude.

    And the reality is that there is not enough money to pay for your feelz.


    My feelz? Dude, I'm a Millennial. Those programs are going broke decades before they'll be paying for anything of mine. No, it's Baby Boomers and whatnot having their "feelz" paid-for.

    As for "greedy capitalist running pig dog rhetoric" ("running pig dog"? That's a fun one), it's not rhetoric. We know from history that when given tax breaks, subsidies, facing windfalls and so-on, few companies will share the wealth with their employees. A small handful do so as publicity stunts, but that's it. That's not rhetoric, that's history.

    As for...

    We'll just put aside your stupidity assuming that the programs are zeroed out instantaneously


    Hey, if you don't want people to think you want unrealistic scenarios, you should probably stop demanding them.

  • NotAnotherSkippy||

    That by your definition most Americans are socialists. Kinda devalues the term, but whatever lifts your luggage dude.

    They are certainly ignorant. You do not bring up the average.

    We know from history that when given tax breaks, subsidies, facing windfalls and so-on, few companies will share the wealth with their employees.

    I see you supplying copious evidence of this. Oh wait. Let me guess, you think the minimum wage works too.

    Hey, if you don't want people to think you want unrealistic scenarios, you should probably stop demanding them.

    Funny, you're the one not facing reality. Did you assume that zero defense spending was a real proposal? The point is a simple one: mathematically, it is impossible to close the debt bomb without cutting entitlements. Please tell me you do not code for any mission-critical industry, or let me know which ones so I can avoid their products.

  • EscherEnigma||

    I see you supplying copious evidence of this.


    As much as you have disproving my statement. But go ahead, knock yourself out trying to prove me wrong. Fair warning though, this is my final post for the day and I doubt I'll be looking at this thread every again.

    That said, are you really trying to argue that "corporations do not have a track record of passing on profits to their employees" is a bold claim? Minimizing labor costs to maximize profit is SOP. There's a reason corporate profits have been on the rise for decades while individual median income has been largely stagnant. Passing along the wealth is not what wealthy people do.

    And if you confuse that for an "anti-capitalist message" or something, that's on you.

    The point is a simple one: mathematically, it is impossible to close the debt bomb without cutting entitlements.


    So you're just going to gloss over the point where I never contested the math, eh?

    Please tell me you do not code for any mission-critical industry


    I can neither confirm nor deny.

  • NotAnotherSkippy||

    As much as you have disproving my statement. But go ahead, knock yourself out trying to prove me wrong. Fair warning though, this is my final post for the day and I doubt I'll be looking at this thread every again.

    Burden is on the claimant, bro. But, hey, the greedy corporations are exploiting workers is a hoot. As opposed to arguing your feelings, yes I can back it up.

    So you're just going to gloss over the point where I never contested the math, eh?

    As much as you glossed over the point that this wasn't all about your feelz. See, this just wouldn't be America if we didn't have the welfare state.

    And leaving the field was the wise choice in your case. At least you were bright enough to figure that out.

  • Nardz||

    this is my final post for the day and I doubt I'll be looking at this thread every again.

    "I'm taking my feelz, and going home!"

  • Giant Realistic Flying Tiger||

    6) Defense spending is a problem, although it's not the biggest problem. Personally, I'd like to see a lot less foreign adventurism, especially the planless type we seem to have with regards to Muslim nations.

  • Just Say'n||

    Yes!

    #BillWeld2020

  • Just Say'n||

    Just kidding, Weld is a warmongering shit head

  • DiegoF||

    George Fox was a warmongering shit head to Just Say'n.

  • DiegoF||

    Hehe. You are right about Weld of course. Though that's far from his only problem.

    I actually would be overjoyed if he were a Democratic candidate; he is head and shoulders above the kind of "centrist independents" and "Rockefeller Republicans" normally lionized by Democratic moderates. I have no particular desire to see Mike Bloomberg be the face of their party over any other shithead there. Jon Kasich is actually much further from being a cocktail-party "cool" Republican to the blue-state bougie crowd, but I'd sure as fuck vote Weld 100 times before I ever pulled the lever for him.

  • BestUsedCarSales||

    Weld/Chomsky2020

  • Vernon Depner||

    We can only hope it's planless. I think the reason why global conspiracy theories are so popular is that people find it more comforting to believe someone is in charge, even if they're evil, than to believe world leaders are actually as incompetent as they appear to be.

  • Don't look at me.||

    They are even more incompetent than they appear.

  • Giant Realistic Flying Tiger||

    I don't think it's planless per se. Lemme tell you a story.

    Way way back in the 1960s, the American armed forces got stuck in a quagmire we now call the Vietnam War. The American leadership had no clear cut plan to win the war, because Johnson didn't want to embrace the war and make winning it a central priority (because this would cost him his so-called "War on Poverty") but he thought he couldn't pull out because the Republicans would tar him as being weak. So instead, the philosophy followed by the American government with regards to Vietnam was "shovel another hundred thousand young men into the meat grinder". (For the record: LBJ was right about what the Republicans would say about him, and Nixon followed the same philosophy until Congress finally cut funding for Vietnam.)

    Today, we don't have a drafted army, we have a volunteer army. And what do we do? Often, we pick on enemies who can't really fight back and injure us. So, based on the Vietnam template, the government does follow a plan when it comes to foreign excursions:

    1) Pick a weak(ish) target we don't like
    2) Attack them
    3) Claim to have righted some wrong with military force
    4) Bask in the glory of a "successful military expedition"

    And, of course:
    5) Ignore the anti-American sentiment caused by these moronic excursions
    6) If the target is stronger than expected, bomb it some more

    So yes, I believe our leaders have a plan.

  • ||

    I think the reason why global conspiracy theories are so popular is that people find it more comforting to believe someone is in charge, even if they're evil, than to believe world leaders are actually as incompetent as they appear to be.

    ^ This x1000.

  • NotAnotherSkippy||

    No it isn't. Defense spending as %GDP is lower now than the post war average. Significantly lower. What is increasing are entitlements. Full stop.

    As Riedl wrote to me, "popular solutions will not work. Doubling the 35 percent and 37 percent tax rates to 70 percent and 74 percent would close just (one-fifth) of the long-term Social Security and Medicare shortfall. Cutting defense to European levels would close just (one-seventh) of it. Nor can economic growth or inflation fix the gap."
  • Giant Realistic Flying Tiger||

    I never made the argument that entitlements aren't the problem. They are. But entitlements being the problem is not mutually exclusive with defense spending being too high.

  • NotAnotherSkippy||

    When it comes to going broke, yes they are mutually exclusive. Again, cut defense to zero and we still go broke. Cut entitlements to zero and we don't. If you want to cut defense for other reasons, then make that case. Just stop pretending it has anything to do with our debt problem.

  • Earth Skeptic||

    Maybe we should all be honest and admit that its not the spending, its what we get (and what we like) for that spending.

    Welfare programs buy lots of poor brown people, and pay the wages of lots of sociology majors and activist support groups who live in urban areas.

    Military spending buys lots of guns and bombs and other scary shit, and pays the wages of engineers and machinists who live in white suburbs and rural areas.

    Both sides have tons of bureaucrats and lobbyist-lackeys, so they cancel out.

  • JFree||

    You kind of missed the biggest group of teat-suckers. The elderly and those who service them get close to half of all federal spending

  • Vernon Depner||

    Of course they can "pay for it". They can create as much money as they want to. They could pay for all their spending by creating money and reduce taxes to zero. The only limit is the point at which people stop taking their IOUs. And even then, they could just start killing the people they owe money to. Think bigger.

  • Nardz||

    ^plan A

  • JeremyR||

    You have it the other way around, they have spending they can't pay for.

  • Echo Chamber||

    Just one more round of tax cuts, then Team R will start working on cutting spending.
    What? Blue wave coming? Nevermind the spending bit, just cut taxes while ya got the gavel

  • Entropy Drehmaschine Void||

    Taxation is theft.

    Nikhil Sridhar is stupid.

    That is all.

  • Hamster of Doom||

    C'mon, man. What are the actual chances that Sridhar is stupid, as opposed to ignorant? The kid's prolly spent the vast majority of life in thrall to education. Maybe we can dial back our expectations, just a bit. Yes, yes, it's a tall order; and yet that's no more than we deserve for letting the kid grow up in an employment market which prized credentials over merit.

    Besides, that face. Look at that face.

    Sridhar will learn. It'll happen faster if'n Sridhar reads the comments, and realizes that education is free and ubiquitous rather than dispensed from on high by the Right Sort With Proper Paperwork.

    I mean... y'know... yes, it's a mistake, and yet perhaps a slightly larger mistake is to expect a credentialed intern who has no idea what nonsense has been spouted all their life to know better, so they can tell us what's what. It's our job to know what's what, and we've got more incentive and experience with it. You know the Peter principle? Well, Peter taught this kid everything he knew. Poor kid.

  • Toast88||

    And my job is putting me $10,000 in debt by only paying me $50,000 for my $60,000 lifestyle.

  • Longtobefree||

    Not a problem.
    Eliminate these in their entirety;
    Department of education
    Department of commerce
    Department of labor
    Department of interior
    Department of agriculture
    Department of energy
    Department of transportation
    Department of health and human services
    Department of housing and urban development
    That should pretty well cover it.

  • BestUsedCarSales||

    It would not cover it. Worthwhile start.

  • sparkstable||

    You forgot POTUS, SCOTUS, and Congress. You can cut those, too.

    There isn't anything inherent in the geographic size of the portion of North America currently known as the USA that requires a single government. If it did, Africa and Asia would be only two countries apiece or thereabouts.

  • Brian||

    It's alright: deficit spending is a boom to the economy, and being able to go into massive debt is a testament to the awesomeness of your country and economy. Or something.

    Anyway, this is totally cool.

  • chipper me timbers||

    All state and federal spending is debt spending. They will never balance a budget, they will never 'pay down the debt'. Debauching the currency feeds into that but it's more than that.

    The only way to reduce debt and spending is to reduce revenues. It has worked (See California circa 2010 or so when the beast was finally starved in the great recession and they actually cut their budget). See the incredible sequestration from a few years ago where the biggest budget fight of all time was over whether or not to reduce the GROWTH, not even the current spending. IT will NEVER be balanced.

    CUT REVENUES TO CUT SPENDING.

  • Let freedom ring||

    You cannot depend on the federal government to cut spending. Why should they? They have the best scam in the world going, with a compliant population that has abandoned the Constitution and elects those who promise to punish enemies and reward friends while keeping USA safe.
    The founders designed the Constitution so that all indirect taxes were at least to some extent voluntary. If you did not engage in a taxable activity, you did not pay tax. However, they allowed for direct taxes on property by the cumbersome and seldom used method of apportionment according to census.
    The first federal income tax in 1861 was on federal salaries, withheld by federal paymasters. Non federal salaries were encouraged to pay to support the war, but there was no enforcement mechanism for those who did not. IOW, voluntary.
    In 1896 the Supreme CT broke from traditional jurisprudence to declare taxing investment income from dividends and rents with a federal nexus was unconstitutional due as it was a tax on the source, ie stocks and improved land.
    This caused an uproar in the classical liberal and populist opposition as they were sick of Rebublican crony capitalists, especially the railroads.

  • BigT||

    Our early govt was paid for by tariffs.

    Trump is merely returning us to our roots!

  • EscherEnigma||

    Our early government also was fine with the old and sick dying off (our two biggest expenditures today).

    So I'm not really sure that the challenges our early government faced are comparable to today's challenges.

  • NotAnotherSkippy||

    Yes, these days we think unicorns are real. Too bad economics doesn't care about your feelings.

  • Brian||

    I heard a nasty rumor: old people still die.

    Is that true?

  • sparkstable||

    Is it possible that the reason they died was because of a lack of overall productive capacity at the time? I mean... in today's world it is much easier to produce more with less labor thereby creating enough surplus to help alleviate the problems of the less fortunate. I mean... it's just an idea. I suppose it is also possible that the single and only reason any poor person has ever survived through the night was because someone somewhere cared enough to take other people's money by force and inefficiently spread it around in such a way that the less fortunate only saw a sliver of it. That COULD be it I suppose so MAYBE you are right. I guess we will never know...

  • swampwiz||

    Make America Broke Again!

  • Let freedom ring||

    the 16th Amendment resulted in judges being told to regard excise taxes on privilege constitutional regardless of source. Few American workers paid the tax until the 1930's when some were enticed to by Social Security. Then in WWII the VICTORY TAX expanded with universal withholding even though the laws were never changed and still only mandate withholding for federal employees and a few others
    In the 1970's with stagflation etc the TAX HONESTY movement was formed . Unfortunately, although well intentioned, the tactic of don't file and don't pay resulted in prison sentences for many.
    Then in 2003 a libertarian in Michigan named Pete Hendrickson realized you have to file a return, but you can use federal forms to demand withholdings returned. Since then thousands have received full refunds of state and federal income taxes, even payroll taxes, which up until then was considered impossible to achieve.
    You cannot stop the scam by voting. And libertarian party and establishment libs and conservatives, even those who claim to be constitutional scholars, simply do not understand the tax. The tax is based on individual assessment, and only individuals can exercise their rights and defeat the scam
    see www.losthorizons.com

  • Let freedom ring||

    the 16th Amendment resulted in judges being told to regard excise taxes on privilege constitutional regardless of source. Few American workers paid the tax until the 1930's when some were enticed to by Social Security. Then in WWII the VICTORY TAX expanded with universal withholding even though the laws were never changed and still only mandate withholding for federal employees and a few others
    In the 1970's with stagflation etc the TAX HONESTY movement was formed . Unfortunately, although well intentioned, the tactic of don't file and don't pay resulted in prison sentences for many.
    Then in 2003 a libertarian in Michigan named Pete Hendrickson realized you have to file a return, but you can use federal forms to demand withholdings returned. Since then thousands have received full refunds of state and federal income taxes, even payroll taxes, which up until then was considered impossible to achieve.
    You cannot stop the scam by voting. And libertarian party and establishment libs and conservatives, even those who claim to be constitutional scholars, simply do not understand the tax. The tax is based on individual assessment, and only individuals can exercise their rights and defeat the scam
    see www.losthorizons.com

  • chemjeff radical individualist||

    No, tax cuts don't have to be "paid for". Spending has to be paid for. So the only real question is, absent a significant cut in spending, who will pay for our current level of spending - us, via taxes, or future generations, via their higher taxes?

  • NotAnotherSkippy||

    Correct.

  • jdgalt1||

    Or whoever is unable to leave the sinking ship when the USA effectively goes bankrupt, either by failing to pay or by inflating the dollar to worthlessness.

    Most Latin American countries in the 20th century were perfect examples of what will happen to the USA then.

  • Sevo||

    You seem confused.

  • Palin's Buttplug||

    I was told here that as soon as the GOP controlled the House, Senate, and POTUS that spending cuts would happen like magic because ...REPUBLICANS ARE FOR SMALL GOVERNMENT!!!!.

    Of course that was lie and has always been a lie.

  • creech||

    True, but then why are Democrats always trying to convince people that Republicans are going to decimate the federal bureaucracy and slash welfare spending?

  • Tony||

    They're doing their best given the circumstances (orangutan president).

  • Sevo||

    Tony|7.26.18 @ 11:39PM|#
    "They're doing their best given the circumstances (orangutan president)."

    Chimpanzee comments.
    Fuck off, scumbag.

  • Tony||

    I'd respect you a little if you acknowledged that this Trump thing is probably not going to end well.

  • Social Justice is neither||

    No new open air slave markets because of his policy so far.

  • Rockabilly||

    hey man, I gave you advise last week on what to do.

    Cut the size of government by 98%

    There, I did your work for free and now you can take the rest of the year off for a nice nap

    You're welcome.

  • jdgalt1||

    Anyone who fails to understand the fact that letting taxpayers keep more of their own money is not something that needs to be "paid for," ought to be fired from Reason for not being libertarian.

  • MasterThief||

    I'd say that a majority of the featured writers here ought to be fired for the same reason of not being libertarian. Still, this is a blatantly wrong position to take and isn't even debatable on libertarian principles.

  • Sevo||

    Starve the beast. Cut taxes until there is no option but to cut expenditures.
    Never and nowhere has cutting expenditures led to allowing people to keep their wealth and even an intern should know that.
    Cut TAXES. Always and everywhere until there is no money left to pay the bills, and then cut them again.

  • Trollificus||

    But, but, but! They HAVE to have the money, because:

    "The cupboard is bare. There's no more cuts to make. It's really important that people understand that,"
    ~Rep. Nancy Pelosi, (D), 09/2013

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