Krugman on Taxes

Paul Krugman has a very good column today looking at the dishonesty in arguments put for by austerity-hawks like Paul Ryan, who push for tax cuts that will certainly increase the deficit while claiming to care about reducing the deficit. Krugman contrasts Ryan’s budget insanity (and President Obama’s better, but still misguided budget) with the proposal from the Congressional Progressive Caucus.

[T]he only major budget proposal out there offering a plausible path to balancing the budget is the one that includes significant tax increases: the “People’s Budget” from the Congressional Progressive Caucus, which — unlike the Ryan plan, which was just right-wing orthodoxy with an added dose of magical thinking — is genuinely courageous because it calls for shared sacrifice.

True, it increases revenue partly by imposing substantially higher taxes on the wealthy, which is popular everywhere except inside the Beltway. But it also calls for a rise in the Social Security cap, significantly raising taxes on around 6 percent of workers. And, by rescinding many of the Bush tax cuts, not just those affecting top incomes, it would modestly raise taxes even on middle-income families.

All of this, combined with spending cuts mostly focused on defense, is projected to yield a balanced budget by 2021. And the proposal achieves this without dismantling the legacy of the New Deal, which gave us Social Security, and the Great Society, which gave us Medicare and Medicaid.

Of course, the fact that Progressives have the most serious budget proposal, which targets those who can most afford to give up more while preserving programs that help keep people out of poverty, is ignored by most of the DC press corps and Beltway politicians. I’d say this is simply because elites don’t care about the deficit and do care about doing whatever possible to transfer wealth from working Americans to the rich. The deficit hysteria is kabuki theater meant to mask new and more efficient ways to having the US government become an Anti-Robin Hood, who steals from the poor to give to the rich. Krugman arrives at a somewhat more measured assessment:

The answer, I’m sorry to say, is the insincerity of many if not most self-proclaimed deficit hawks. To the extent that they care about the deficit at all, it takes second place to their desire to do precisely what the People’s Budget avoids doing, namely, tear up our current social contract, turning the clock back 80 years under the guise of necessity. They don’t want to be told that such a radical turn to the right is not, in fact, necessary.

I just don’t think there’s any actual concern about necessity on the part of austerians. Necessity is an argument, an appeal that seeks to avoid discussion and debate of more serious (read: the CPC) plans that might inflict the most superficial of pains on the rich. The larger question to me is what does it mean that the CPC can produce such a serious, effective proposal and leaders of the Democratic Party completely ignore it?

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