Bill O'Reilly is trying to play the only adult in Republican politics so his analysis of the new Debt Ceiling bill is to forget eight years of George Bush, whose policies took a federal surplus into his presidency and turned it into massive debt. He conveniently forgets about the Bush tax cuts, unpaid wars, unfunded Medicare Part D and blames out of control Liberal policies, regulations and government spending for causing all our economic problems. In his Talking Points Memo segment which guides his entire show, he only blames Liberals for our economic problems. No mention of the corruption of Wall Street that led to the TARP bailout born out of the mortgage meltdown crisis, except of course blaming that on Barney Frank. He does have a talent for making right wing propaganda seem almost believable to his flock. (Transcript wasn't available at the time of the post)
BillO does make the case that the government needs to raise revenues which Grover Norquist would disapprove of, but the way he goes about it is to propose the absurd flat tax scheme that shields the rich and calls for a regressive national sales tax that will only hurt 98% of the the American population. See, adding a tax on basic goods is throwing down more taxation on the working class of Americans that can ill afford it. And his defense of it was that since drug dealers weren't paying any taxes we'd get them there to reduce the deficit. Insanity, I know.
On the Flat Tax, which is class warfare that benefits the rich as usual---economist Holley Ulbrich writes:
The attraction of simplicity hides a big change in the distribution of tax obligations among the poor, the middle class, and the rich. When think tanks like Cato and Heritage support changes that redistribute the tax burden in that way, they usually warn us of the evils of class warfare. But the proposed flat tax is, in fact, class warfare—yet another attempt to reduce the tax obligations of higher-income households in exchange for the unenforceable hope or promise that they might use the money to invest and create jobs, maybe even jobs in the United States.
Two considerations should give us pause before jumping on the flat-tax bandwagon. The first is the disruptive effect of eliminating deductions, credits and exclusions that benefit the middle class as well as the rich and that play important roles in our lives—pension contributions, employer-provided healthcare, and deductions for mortgage interest, property taxes, and charitable contributions that support everything from soup kitchens to education to the arts. Second is the role of our mildly progressive federal income tax in offsetting regressive taxes elsewhere in the system.
Second, there's no concealing that the flat tax would radically redistribute the tax burden. Adam Smith, to whom economists always turn to for economic wisdom, observed, "It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion." The current U.S. tax system consists mainly of taxes on income (personal and corporate), payroll (Social Security), sales, and property. In 2007, these taxes provided 92 percent of federal income and 51 percent of state and local government income. Sales taxes are regressive—they take a higher share of low incomes than higher incomes.
Robert McIntyre wrote about this shame in 1995 and it creepily applies to today.
There is little or no disagreement among serious analysts that replacing the current, progressive income tax with a flat-rate tax would dramatically shift the tax burden away from the wealthy--and onto the middle class and the poor.
You'll notice that Bill O'Reilly bashes only Liberals in his screed. What a shock. A national sales tax will never happen, but I believe you'll hear more talk coming from Republicans on the flat tax as the election nears because it's an easy phrase to sell.