Pence Agrees That Tax Cuts Don't Have To Be Paid For

[media id=17563] (h/t David at VideoCafe) I think it's a clear indication that the Republican reflexive obstructionism has reached absurd levels wh

3 years ago by David
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(h/t David at VideoCafe)

I think it's a clear indication that the Republican reflexive obstructionism has reached absurd levels when even Chris Wallace calls you on your crap. All that pearl clutching over the deficit--something that mattered not a whit during the Bush years--now requires that Obama offset the costs of extending unemployment insurance but not for the Republican answer for all societal evils, tax cuts for the wealthy. Wrap your mind around that cognitive dissonance.

WALLACE: Congressman Pence, why is it that extending unemployment benefits has to be paid for according to Republicans but extending the Bush tax cuts for the wealthy which would cost $678 billion, that doesn’t have to be paid for?

PENCE: Well, let me…look, Republicans, me included, have supported numerous extensions of unemployment benefits. We’re anxious to do so again. But look….the deficit this year is a trillion dollars for the second year in a row and more. The American people have had it with runaway federal spending, deficits and debt and they want to begin to see the men and women in Washington DC begin to make the hard choices and prioritize spending. The other part of it too…

[crosstalk]

WALLACE: But you’re not answering the question. I can understand the argument: pay for the unemployment benefits. Why then not pay for the Bush tax cuts for the wealthy?

Pence weasels out of it again. Because clearly, there are no justifications for this except craven political ones. He then argues that the tax cuts expand the economy, despite the fact that the expressed concern up to this point has been reducing the deficit.

At this point, I think it's important to add a little GOP-dreaded facts into the discussion. As a method of stimulating the economy, something we all agree must be done, tax cuts don't help nearly as much as extending unemployment insurance:

Lowering taxes puts money in consumers' pockets quickly, but economists worry that with uncertainty running high, many households will choose to save rather than spend the money. While most economists would like to see the U.S. saving rate rise from its current low level of 1.2 percent, a sudden jump in savings would deepen the recession.

Many economists are pushing for targeted benefits such as food stamps or extending unemployment benefits. Mark Zandi, chief economist at Moody's Economy.com, estimates that every dollar dedicated to increasing food stamps puts $1.73 into the economy. Increasing jobless insurance benefits typically gets a return of $1.64 per dollar. (here)

Obama also is expected to support tax cuts for businesses, which would raise corporate profits and may help the stock market. Unless the economy recovers quickly those tax reductions would probably do little to encourage companies to step up hiring and investment, Deutsche Bank economist Peter Hooper said.[..]

In congressional testimony last year, Zandi said tax cuts delivered the least bang for the buck, with a dollar's worth of temporary nonrefundable rebates worth $1.02 with a one-year lag. Permanent tax cuts yielded less than 50 cents of additional spending.

So by his own admission, Pence wants to do the least effective method of expanding the economy and add hundreds of billions to trillions to the deficit all the while gnashing and wailing about those irresponsible Democrats growing the deficit. Wow. Nice game if you can get it.

Transcripts below the fold

WALLACE: There is, Congressman Pence, the big vote, perhaps this week, coming up, on whether to extend unemployment benefits. Republicans say it must be paid for. Here is the President’s response:
(VIDEO) PRESIDENT OBAMA: They’ve got no problem spending money on tax breaks for folks at the top, who don’t need them and didn’t even ask for them, but they object to helping folks laid off in this recession who really do need help.
WALLACE: Congressman Pence, why is it that extending unemployment benefits has to be paid for according to Republicans but extending the Bush tax cuts for the wealthy which would cost $678 billion, that doesn’t have to be paid for?
PENCE: Well, let me….look, Republicans, me included, have supported numerous extensions of unemployment benefits. We’re anxious to do so again. But look….the deficit this year is a trillion dollars for the second year in a row and more. The American people have had it with runaway federal spending, deficits and debt and they want to begin to see the men and women in Washington DC begin to make the hard choices and prioritize spending. The other part of it too…
[crosstalk]
WALLACE: But you’re not answering the question. I can understand the argument: pay for the unemployment benefits. Why then not pay for the Bush tax cuts for the wealthy?

PENCE: I think the reality is..as you study…when President Kennedy cut marginal tax rates, when Ronald Reagan cut marginal tax rates, when President Bush imposed those tax cuts, they actually generated economic growth, they expand the economy, they expand tax revenue…

WALLACE: But the deficit still grew…

PENCE: …and so the way…well, the deficit grew under the Reagan administration and the Bush administration for different reasons. And it had a lot to do with spending. The reality is during the Reagan years, for instance, we doubled the amount of revenue that we were sending Washington DC after the tax cuts took effect. The point is, we got to get this economy moving again. And we can’t go back to either the “tax and spend” policies of the Democrats or the “tax cut and spend” policies of the prior administration. Fiscal discipline and tax relief, that’s how we get America moving…

WALLACE: Congressman Clyburn.

CLYBURN: Let me tell you what we cannot go back to. We cannot go back to those policies that lost eight million jobs in 8 years. We can’t go back to the policies that refuse to give 95% of American people—as we have done—a tax cut. Giving tax cuts to the upper 2% and not paying for them is the kind of prescription that got us into this difficulty in the first place. The American people do not want to go back to that. Democrats will not go back to that. I’m going to say to my friend, Mike Pence, I think you are mis-reading the tea leaves here. And I do mean that as an intended pun. We are going to take our contrast between us and the Republicans to the American people this fall, we plan to win this election and win it big…

About Nicole Belle

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Mom, Wife, Media Critic/Political Analyst, Blogger, Austen Fanatic, Unapologetic Liberal NicoleBelle@crooksandliars.com

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