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Opinion

Opinion

Dare Democrats to do something about debt

November 26, 2011

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— Democrats are unanimous in charging that the debt-reduction supercommittee collapsed because Republicans refused to raise taxes. Apparently, Republicans are in the thrall of one Grover Norquist, the anti-tax campaigner, whom Sen. John Kerry called “the 13th member of this committee without being there.” Senate Majority Leader Harry Reid helpfully suggested “maybe they should impeach Grover Norquist.”

With that, Norquist officially replaces the Koch brothers as the great malevolent manipulator that controls the republic by pulling unseen strings on behalf of the plutocracy.

Nice theory. Except for the following facts:

• Sen. Tom Coburn last year signed on to the Simpson-Bowles tax reform that would have increased tax revenues by $1 trillion over a decade.

• During the debt-ceiling talks, Speaker John Boehner agreed to an $800 billion revenue increase as part of a Grand Bargain.

• Supercommittee member Pat Toomey, a Club for Growth Republican, proposed increasing tax revenues by $300 billion as part of $1.2 trillion in debt reduction.

Leading, very conservative Republicans proposing tax increases. So why does the myth of the Norquist-controlled anti-tax monolith persist? You might suggest cynicism and perversity. Let me offer a more benign explanation: thickheadedness. Democrats simply can’t tell the difference between tax revenues and tax rates.

In deficit reduction, all that matters is tax revenues. The holders of our national debt care not a whit what tax rates yield the money to pay them back. They care about the sum.

The Republican proposals raise revenues, despite lowering rates, by opening a gusher of new income for the Treasury in the form of loophole elimination. For example, the Toomey plan eliminates deductions by $300 billion more than the reduction in tax rates “cost.” Result: $300 billion in new revenues.  

The Simpson-Bowles commission — appointed by President Obama and endorsed by Coburn — used the same formula. Its tax reform would lower tax rates at a “cost” of $1 trillion a year while eliminating loopholes that deprive the Treasury of $1.1 trillion a year. This would leave the Treasury with an excess — i.e., new tax revenues — of $100 billion a year, or $1 trillion over a decade.

Raising revenues through tax reform is better than simply raising rates, which Democrats insist upon with near religious fervor. It is more economically efficient because it eliminates credits, carve-outs and deductions that grossly misallocate capital. And it is more fair because it is the rich who can afford not only the sharp lawyers and accountants who exploit loopholes but the lobbyists who create them in the first place.

Yet the Democrats, who flatter themselves as the party of fairness, are instead obsessed with raising tax rates on the rich as a sign of civic virtue. This is perverse in three ways:

(1) Raising rates gratuitously slows economic growth, i.e., expansion of the economic pie for everyone, by penalizing work and by retaining inefficiency-inducing loopholes.

(2) We’re talking pennies on the dollar. Obama’s coveted Bush tax cut repeal would yield the Treasury, at the very most, $80 billion a year — offsetting 2 cents on the dollar of government spending ($3.6 trillion).

(3) Hiking tax rates ignores the real drivers of debt, which, as Obama himself has acknowledged, are entitlements.

Has the president ever publicly proposed a single significant structural change in any entitlement? After Simpson-Bowles reported? No. In his February budget? No. In his April 13 budget “framework”? No. During the debt-ceiling crisis? No. During or after the supercommittee deliberations? No.

As regarding the supercommittee, Obama was AWOL — then immediately pounced on its failure by going on TV to repeat his incessantly repeated campaign theme of the do-nothing (Republican) Congress.

A swell slogan that fits nicely with the Norquist myth. Except for another inconvenient fact: It is the Republicans who passed — through the House, the only branch of government they control — a real budget that cut $5.8 trillion of spending over the next 10 years. Obama’s February budget, which would have increased spending, was laughed out of the Senate, voted down 97-0. As for the Democratic Senate, it has submitted no budget at all for two and a half years.

Who, then, is do-nothing? Republicans should happily take on this absurd, and central, Democratic campaign plank. Bring Simpson-Bowles to the House floor and pass the most radical of its three deficit-reduction alternatives.

Dare the Senate Democrats to vote down the grandest of all bargains. Dare Obama to veto his own debt commission. Dare the Democrats to actually do something about debt.

Charles Krauthammer is a columnist for Washington Post Writers Group.

Comments

bobberboy 2 years, 4 months ago

Raise taxes on the rich !!!!!!!!!!!!!!!!

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beatrice 2 years, 4 months ago

Instead of daring one side or the other to do something, why don't we dare Congress to work together for the betterment of the nation and the lowering of the deficit and debt? As long as we stay with this idea that one party or the other has all the answers and shouldn't give an inch, we will never fix what is wrong.

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HomeSlice 2 years, 4 months ago

The Republicans need to give on Defense spending - there is enough waste that can be filtered out to justify a decent amount of cuts, perhaps even the amount of cuts that will automatically trigger if our employees, the politicians, once again don't do their job. We will be no less safe by reducing spending by these amounts. Doing so gives the Democrats no place to hide, and they will be forced, or at least called out to cut some of their favorite rat-hole spending programs. The Republicans are missing a great opportunity to break the log jam.

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tomatogrower 2 years, 4 months ago

Republicans whined about the debt when Clinton was president, then when Bush was president, it was no big deal. Now they are whining about it again, even though Bush has created a larger debt than Obama. Especially if you consider that the money we have spent on Iraq up to this point is Bush's doing.

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Katara 2 years, 5 months ago

It is funny that Krauthammer does not mention why Sen. Coburn supports raising taxes.

http://tinyurl.com/7zlyph7

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Cait McKnelly 2 years, 5 months ago

Dare Republicans to do something about jobs so we can get out of debt. Simplistic? Yes. Just as simplistic as the title of this article and the person that wrote it.

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Mike Ford 2 years, 5 months ago

math let me spell out the way your dimwits deserve blame since you love to bait arguements and act like crooks aren't deserving of the hating they get....

  1. Grover Norquist was tied into the whole Tom Delay lobbying mess along with Jack Abramov and Michael Scanlon. These two lobbied away $80 million from the Saginaw Chippewa Tribe of Michigan, Coushatta Tribe of Louisiana, and the Mississippi Band of Choctaw (my relatives), to name a few. Jack Abramov still owes the Coushatta people $20 million in restitution by order of the judge who sentenced him to the 4 years in prison he served. Norquist, Delay, Scanlon, and Abramov.....all good republicans????

  2. The Kochs fund all of the misleading nonsensical think tanks in order to have no rules to follow on the environment and steal Osage tribal oil for decades.... good guys????

  3. Brownback is soooo slick he took campaign money lobbied through the Delay and Abramov fronts and was involved in the C Street Mess in DC>

  4. Bush was a publically inept speaker and thinker and a puppet front for the Delays Roves, and other assorted crooks. Didn't catch 9/11 on time with neo con distractions in his first year....appointed a dimwit like Michael Brown to FEMA and my relatives suffered for a year after Katrina....invaded Iraq and looked the other way as the no bid Haliburton contracts and fraud occured (Solyndra....really???? it has nothing on Haliburton and Cheney....a bunch of clowns trying to cover Haliburton with Solyndra really???) a couple of tax cuts that did nothing and a Medicare Part D that was a giveaway to the drug companies and cost more than the stimulus plans you dimwits call a failure...

  5. Faux news....the wiretapping half truth pimping race baiting excuse of a network supplying the archie bunkers, squidbillies, and church ladies of the world with more misleading garbage taken as the total word....

    the whole blame game started with people like you who wouldn't dare admit the mess bush left and act like it could be fixed in a couple of years but then again a book, The Wrecking Crew, spelled out what some crooks are up to into your wishes to dismantle the federal government so you can pollute, rip off, and be racist to anyone you want to... you want the 1950's back so badly it's pathetic.

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jonas_opines 2 years, 5 months ago

Dare politicians to do something about the debt.

I seem to have missed when the debt shrank under Republicans in the last thirty years.

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tbaker 2 years, 5 months ago

The dems had to kill the Super Committee. The plan to re-elect PrezBo is to blame the economic mess the country is on the rich (aka; republicans). Class warfare doesn't work very well if they are seen cutting spending. $1.2T isn't really a spending cut when you look at the numbers. It was nothing more in a slight reduction in the rate at which federal deficit spending is increasing.

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tange 2 years, 5 months ago

Dare Charlie Krauthammer to eat all the brine cabbage he pounds out weekly.

/ garnishing a little crow, perhaps

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KEITHMILES05 2 years, 5 months ago

We do NOT have 25 million unemployed! LOL

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Richard Heckler 2 years, 5 months ago

For the record...

The Club for Growth is about supporting the Norquist tax theory and was introduced by a former Brownback chief of staff.

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cato_the_elder 2 years, 5 months ago

Excellent column. House Republicans should take his advice.

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its_just_math 2 years, 5 months ago

What would the left do without Norquist, Kochs, Bush, Brownback, Fox News and a whole host of right-winger evil-doers to blame all of Obama's and Democrats failures on. Funny how Obama almost vanishes in the wake of the super-committee meltdown. The worst leader this nation has ever seen. Please let it be over in about a year.

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mloburgio 2 years, 5 months ago

The Cost Of Bush Tax Cuts For The Richest 5 Percent: $11.6 Million Per Hour | The National Priorities Project, in partnership with Citizens for Tax Justice, has released a new site tracking the ever-growing cost of the Bush tax cuts. They found that the tax cuts for only the richest 5 percent of Americans “cost the U.S. Treasury $11.6 million every hour of every day.” http://thinkprogress.org/economy/2011/10/14/344329/tax-cuts-five-percent-11-6-hour/

30 Major Corporations Paid No Income Taxes In The Last Three Years, While Making $160 Billion http://thinkprogress.org/economy/2011/11/03/360185/30-corporations-no-taxes/

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Richard Heckler 2 years, 5 months ago

  1. Cut off the Bush tax breaks forever December 25, 2011

  2. PUT 25 MILLION unemployed back to work at no less than $17.50 per hour

  3. Sign on to a budget that some democrats put forward yet the RINO NO party said NO:

This is the only budget that does everything this country needs: * Reduces Debt by $10 trillion * Creates good-paying jobs * Fully maintains our social safety net * Invests in education * Ends our costly wars * Closes the tax loopholes that have made offshoring jobs profitable * Ends oil and gas subsidies that pollute our country at taxpayer expense * Creates a national infrastructure investment bank to help us make intelligent investments for the future

This fiscally responsible budget represents the future we believe in as Americans, and the CPC really needs our support to keep it on the front burner.

This is one of those occasions we all hope we'll live to see: We really can make a difference right now if we speak up loudly with one voice.

This fiscally responsible budget represents not just common sense; it represents the will of the American people.

These aren't just words on a page or numbers in a table—these dollars and cents mean lives helped or hurt, people succeeding or falling by the wayside, and families lifted up or dragged down.

This is about America. http://www.pdamerica.org/get-informed/view/critical-vote-on-the-peoples-budget-scheduled-for-9-am-tomorrow/

What this budget does very specifically:

http://cpc.grijalva.house.gov/index.cfm?sectionid=70&sectiontree=5,70

http://www.npr.org/2011/04/15/135435883/the-nation-obama-should-fight-for-peoples-budget

http://www.democracynow.org/2011/4/14/while_obama_touts_compromise_with_gop

http://www.thenation.com/blog/159939/fighting-peoples-budget

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Abdu Omar 2 years, 5 months ago

Look, let's look at closing the "mortgage loophole". Who pays for their houses through mortgages? The rich? NO, it is the middle class. The poor can't buy a house and the rich pay cash. It is the middle class who pays for 30 years and the interest is their best deduction. But stop that "loophole" and you take away any hope for the real estate market to rebound.

This Norquist pledge is exactly what is wrong in American Politics. By pledging to anyone except the representative's constituents, there is no representation in the Congress. No one should ever pledge anything to a lobbyist.

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