Mitch McConnell's Fiscal Nonsense
The chutzpah of Mitch McConnell is astounding. McConnell says that unemployment benefits cannot be entended because of the deficit. Candy Crowley asks McConnell if the Bush tax cuts should be allowed to lapse. McConnell was absolutely against that. McConnell then blamed the deficit on the Obama administration and refused to answer if Republicans spent too much during the Bush years. The economics policies of the GOP makes no sense in policy terms. Republican fiscal policies is a wishlist for the base.
Hat tip to Crooks and Liars.
CROWLEY: Here with me now to discuss politics, jobless benefits and the Republican's groove is Senator Mitch McConnell. Thank you so much for being here.
MCCONNELL: Glad to be here, Candy.
CROWLEY: I want to play a little bit more about what the president had to say yesterday when he really was slamming Republicans for standing in the way of this extension of unemployment benefits. Take a listen.
(BEGIN VIDEO CLIP)
OBAMA: They say we shouldn't provide unemployment insurance because it costs money, so after years of championing policies that turned a record surplus into a massive deficit, including a tax cut for the wealthiest Americans, they finally decided to make their stand on the backs of the unemployed.
(END VIDEO CLIP)
CROWLEY: Look, we're talking about $34 billion to extend unemployment to the long term unemployed, to give them more weeks of unemployment benefits. Doesn't he have a point? I mean, why in the world would you choose to take this down? I mean, the deficit's a trillion dollars this year, so for $34 billion that's going to help people with no jobs, you all are standing in the way of it.
MCCONNELL: Well, the budget is over a trillion dollars, too, and somewhere in the course of spending a trillion dollars, we ought to be able to find enough to pay for a program for the unemployed. We're -- we're all for extending unemployment insurance. The question is when are we going to get serious, Candy, about the debt?
We recently passed a $13 trillion cumulative deficit threshold. When are we going to get serious about this? This administration has been on an incredible spending spree.
CROWLEY: I get that point and I understand what you're saying and I think the American people are concerned about the deficit spending. But you all -- when Republicans were in charge six of the eight years that President Bush was here, you were Majority Leader at times during that, you spent on a prescription drug bill that was not paid for that is far more expensive than this unemployment bill is. You had two wars, ongoing wars that were not paid for.
So for you now to stand up and say, well, we're for balancing the budget, and, by the way, you've got to pay for these unemployment benefits, it just seems dissonant to the trials of the American people, particularly those without jobs.
MCCONNELL: Well, let's put it in perspective. The last year of the Bush administration, the deficit as a percentage of gross domestic product was 3.2 percent, well within the range of what most economists think is manageable. A year and a half later, it's almost 10 percent. You know, how many --
CROWLEY: But you can object then --
MCCONNELL: -- how long can we -- how long can the other side run against the previous administration? They've been in charge now for a year and a half. They've been on a gargantuan spending spree. They've taken, as I said, the deficit as a percentage of GDP from 3.2 percent to almost 10 percent in a year and a half.
Look, at what point do we pivot and start being concerned about our children and our grandchildren? There is no way in the world on a trillion dollar budget this year we can't find the money to pay for an extension of unemployment insurance, something we're in favor of.
CROWLEY: But part of that $13 trillion came during a Republican administration for eight years, and I guess the question is that you now are asking the public to bring back a Republican Senate or a Republican House. How can they trust you if three years ago you all were deficit spending, and now you go, well, we're for -- we want to stop. We want to have -- pay as you go?
MCCONNELL: Well, the issue is not whether the public thought Republicans spent more than they should have. The issue is when do we stop doing this?
CROWLEY: Did you spend more than you should have as Republicans?
MCCONNELL: Look, if you put it in comparison, as I just pointed out, we've been on a gargantuan spending spree for the last year and a half, far more than any deficits that were run up in the early part of the decade. This is -- this is a serious matter. At what point do we pivot and do something about this? And we think if you can't pay for a program that everybody agrees we ought to extend, what are we going to pay for?
If we can't pay for a program like extension of unemployment insurance that virtually every member of the Senate -- I think, in fact, every member of the Senate wants to extend, then what are we going to pay for? When do we start?
CROWLEY: Let me ask you, along the same lines. I want you to listen to something that Alan Greenspan, former head of the Fed, had to say earlier this week.
(BEGIN VIDEO CLIP)
ALAN GREENSPAN, FORMER CHAIRMAN OF THE FEDERAL RESERVE: They should follow the law and let them lapse.
(UNKNOWN): Meaning, what happens?
GREENSPAN: Taxes go up. The problem is unless we start to come to grips with this long-term outlook, we're going to have major problems.
(END VIDEO CLIP) CROWLEY: It's Alan Greenspan, talking about allowing the Bush tax cuts to expire in January. Now, this is a man that supported the Bush tax cuts.
MCCONNELL: Right.
CROWLEY: What do you think?
MCCONNELL: Well, the issue is whether we're going to raise taxes. This is current tax law, and what they're saying is we ought to raise taxes in the middle of a very, very difficult economic environment. I don't think it's a good idea to raise taxes in a middle of an, of a situation like we face today. So we're not talking about extending tax cuts. We're talking about raising taxes.
And then, Candy, they will come back and say, oh, we're only talking about raising taxes on the top income earners. Well, if you do that, you will capture the income of 50 percent of small businesses in this country, the ones right now who are not expanding and hiring.
CROWLEY: I don't know many economists who look at this deficit and don't say you have to do two things here, have you to raise taxes and you have to cut spending. How can the Republicans argue that it is time to get serious about the deficit and let -- and yet argue that these tax cuts should be allowed to stay in place?
It just seems not to make sense. It seems like you're arguing both sides, that -- that you don't want to give benefits to the unemployed until they're paid for, but, by the way, you want to keep the tax cuts in place for people who are quite wealthy, some of them, you know? So it just seems like you're arguing both things here.
MCCONNELL: Well we -- we believe the problem is not that we tax too little, but that we spend too much, and we've had this rate for taxes now for almost a decade. The question is not cutting taxes. The question is raising taxes. What they're trying to do, Candy, is to argue that at this juncture, with this kind of economic environment, we ought to have a significant tax increase. I don't know the economists you're talking to, but the ones I'm talking to are saying raising taxes in the middle of a recession is not a good idea.
CROWLEY: OK, overall, though, a $13 trillion deficit, do you think there is a way to bring down and get rid of a $13 trillion debt without raising taxes?
MCCONNELL: I think that we have a serious problem here because we spend too much. I think we ought to concentrate on the spending side. I've on fact been encouraged by the comments of Erskine Bowles, who's one of the chairmen of the president's Deficit Reduction Commission, a Democrat, who's saying that he thinks two-thirds or three-fourths of the problem is a spending problem. So that's where we ought to --
CROWLEY: (INAUDIBLE) --
MCCONNELL: That's where we ought to start.
CROWLEY: OK, could -- but could you say, categorically, that you would never support a tax increase?
MCCONNELL: I can say categorically that I don't think it's a good idea to raise taxes in the middle of a recession, and that is exactly what will happen if they let the Bush tax rates expire at the end of this year.
CROWLEY: Let me try this one -- one more time, and that is, do you see -- absent a recession, do you see a time when you're going to have to raise taxes in order to get rid of a $13 trillion debt?
MCCONNELL: Well, you can't say absent a recession. We're in the middle of a major economic slowdown.
CROWLEY: Oh, the recession wouldn't always be here.
MCCONNELL: The issue is what are we going to do now in the middle of this economic slowdown? I think raising taxes is a terrible idea, and the economists I talk to believe that it's a terrible idea.
CROWLEY: I'm going to call that a maybe.
We'll be right back. Up next, is there anything on the Democrats' to do list that the Republicans will give them a hand on?
Labels: deficit, mitch mcconnell, tax cuts, unemployment
posted by Michael Hussey @ 10:19 PM
3 Comments
3 Comments:
There's reality -- which has a long memory -- and then there's political reality. Which has no memory. The Republicans broker well in the game of political reality, knowing they can brush whatever messes the Bush administration made onto Obama since the economic condition of the country during his first two years in office hasn't improved.
Of course, the left will retort back that Obama's stimulus plan kept the economy from worsening, possibly dipping into a recession. That's all true, but politically you can't run on a platform of "I maintained stasis."
Unfortunately, what's coming for the Obama administration will be the political equivalent of the Tet Offensive in Vietnam. Militarily, the US won the battles during the Tet holiday because they were able to push the Vietnamese forces back to their original positions. But before the Tet Offensive, the military and LBJ administration told the American public that the North Vietnamese and Viet Cong forces were retreating and the Vietnam War would be over soon. But the Tet Offensive proved that the enemy could still launch surprise attacks and knock our military off-guard. This was a public relations disaster for the LBJ administration, and why the Tet Offensives is widely recognized as a US failure today.
Similarly, Obama came into office on the promise of hope and a better economy. Coming up upon the first midterm elections, the only thing he's provided for the short term is stasis. Is it unfair to judge Obama after only 18 months on the job, given the mess the Republicans handed to him? Yes. But did Obama cash in his political capital chips for a stimulus package that was too small to do anything beyond simply keep the economy afloat? Yes.
You can't win elections on stasis. It also doesn't help that the Democrats have ccontinually let the Republicans control the topics of public discourse.
Perhaps none of this could have been handled better but the Obama administration, but political reality doesn't give a shit.
Paul Krugman's recent op-ed is the White House thought of the short term reality of the daily news cycle and not ahead to the midterm elections. This White House also pissed off the base. Democrats have more registered voters but Republicans will likely have better turnouts.
Another horrible example was centrist policy was the cap and trade bill that was suppose to gain business support. Voters don't understand what cap and trade is and the name of the legislation is insanely stupid. People understand the Clean Air Act is to protect the quality of air.
Financial reform should have been a political winner for Democrats. When Scott Brown protected banks by not having financial institutions pay into the bailout fund Democrats should have said Republicans support using taxpayer money to protect banks. Instead, Democrats rolled over and passed a weak ass bill that progressives hate. The White House's idea of politics is attacking progressives and unions off-the-record and keep preaching about bipartisanship. The White House is even losing Beltway Democrats with Gibbs' comment and Obama's disimnterest in fundraising for candidates.
The Obama neoliberals are closer to Republicans on financial and military policy than they are to the base. The majority of the attacks on Tim Geithner have come from the Left. Robert Gates and Hillary Clinton are not doves. Neoliberalism doesn't work. I would be more than happy if the Democratic Party ran candidates against Obama.
The reason to vote for Obama is being whittled down to simply that he's not one of them. For example, who would you rather have in office: Somebody who expands a useless, hopeless conflict in Afghanistan; or somebody who would have expanded the Afghan war and foolishly thought we could also goto war against Iran at the same time? Beyond stabbing my eye out with a rusty butter knife, my only option is the first one.
Which means that Obama has become just another Democrat.. Which is disappointing. But the Democrats biggest problem right now is that the Tea Party has been smart enough not to split the Right's vote going into the November elections. The GOP will lose some moderate voters due to Tea Party extremists running in the general election, but nobody can deny that the right has gained much of the political momentum that Obama had, and lost. Failed promises of hope won't turn out the same number of voters for Obama in 2012.
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