Saturday, April 07, 2012

The Ryan Budget Scam

Connie Mack IV made the mistake of telling the truth during a Republican primary. The truth is the Paul Ryan budget would not balance the budget anytime in the near future.

"I was here in Florida campaigning," Mack said Saturday, according to an undisputed quote reported by the conservative Florida Political Press. "You know that budget was a joke, doesn't balance the budget for years."

Mack is exactly right. The tea party base is too economically illiterate to crunch the numbers. They believe that Ryan's budget will balance the budget. They have the power of truthiness on their sides.

Ryan's plan is short on specifics. Ryan claims trickle down economics is the answer.

The reform plan, which was first advanced by the House Ways and Means Committee, would broaden the tax base, lower marginal rates and flatten the tax structure from six rates to two: 10 percent and 25 percent. The plan would also lower the U.S. corporate tax rate from 35 percent down to 25 percent and would transition to a terroitorial system of international taxation, which would put U.S. competing businesses competing abroad on a level playing field with their foreign competitors and incentivize the repatriation of funds, currently held offshore for tax reasons, to be to use in the U.S. economy.

Starting a tariff war with China will not make Fortune 500 companies suddenly want to invest in the United States. If Ryan is lowering taxes on corporations and the top 1 percent, exactly who is he broadening the tax pool on.

Ryan doesn't explain what tax loppholes he would close. Economist Paul Krugman notes Ryan projects unemployment will drop to a magical 50 low. Ryan fail to mention how he will use his magic wand to make unemployment disappear. The most telling fact about the House GOP budget not being serious is that Ryan never asked the CBO to do a revenue estimate.

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