Here we go again with Mr. 'Not Intended to Be a Factual Statement" Sen. Jon Kyl, looking out for those so-called "job creators." When asked by Chris Wallace on Fox News Sunday if he'd support an extension of the payroll tax holiday, Kyl claimed that
November 27, 2011

Here we go again with Mr. 'Not Intended to Be a Factual Statement" Sen. Jon Kyl, looking out for those so-called "job creators." When asked by Chris Wallace on Fox News Sunday if he'd support an extension of the payroll tax holiday, Kyl claimed that giving tax cuts to the middle class does not stimulate job creation. When Wallace countered him with some numbers showing that it did, Kyl responded by citing that hack Art Laffer and calling him a "respected economist."

As our own Jon Perr wrote earlier this week -- Republicans Violate Norquist Pledge over Payroll Tax Cut Extension:

The Wall Street Journal greeted the failure of the Congressional debt super committee with an editorial titled, "Thank You, Grover Norquist." That gratitude should have surprised no one. After all, Norquist's anti-tax pledge led handcuffed committee Republicans not just to oppose even modest tax increases on the richest Americans, but to demand another tax cut payday for the privileged while slashing federal spending.

As it turns out, however, a tax increase isn't always a tax increase for Norquist's GOP servants. Not, that is, when those receiving the tax cut are working Americans and the President proposing it is a Democrat. Because after they spent 2010 ensuring the extension of the Bush tax cut windfall for the wealthy by insisting "you should never have to offset the cost of a deliberate decision to reduce tax rates on Americans," GOP leaders are demanding exactly that for President Obama's proposal for continued payroll tax relief. Read on...

Full transcript below the fold.

WALLACE: All right. Gentlemen, let's go back to the debt. And let's start with the items that run out at the end of this year, not 2012. Let's take a look at them. This is unless they are extended.

First, the payroll tax cut costs $112 billion to extend. If it lapses, a family making $50,000 will pay 1,000 more in taxes.

Senator Durbin, Democrats plan to bring this measure, to extend the payroll tax cut up this week. But you're going to pay for it by -- with a surtax on millionaires. That maybe a smart political move, but there's no chance it's going to pass.

DURBIN: Well, it should pass. I mean, look at the bottom line here. You say $1,000. I think it's closer to $1,500 for the average family. If we don't provide the tax relief that President Obama has asked for, families are going to see an increase in taxes.

These are working families, lower and middle income families. And those at the very top who have enjoyed tax cuts that have been very, very generous for a long period of time can afford a slight increase in their tax burden so that we don't add to the deficit. Let's help the working families who are struggling paycheck to paycheck, and ask those who are the most well off in America to pay a very small percentage of increase taxes.

WALLACE: Senator Kyl, Republicans are demanding -- and that's the reason that the Democrats are putting this millionaire surtax are demanding that an extension of the payroll tax cuts, be paid for. But you haven't done that in the past for the Bush tax cut. And one, I would like to know why, the difference between paying for one and not paying for the other, and what do you think are the chances for a deal for the end of this year? Because it runs out this year to extend the payroll taxes.

KYL: Well, we have to deal with the unemployment insurance, with payroll taxes and a lot of other items before the end of the year. The problem here is that the payroll tax doesn't go into general revenue, it supports Social Security. And you can't keep extending the payroll tax holiday and have a secure Social Security. That's the first problem.

The second problem is that by taxing the people who provide the jobs, you put off the day we have economic recovery and job creation in this country. And that's precisely what the Democratic plan would do. It would hit those people, the small businesses who we all acknowledge are the ones who create the jobs coming out of economic difficulty.

And that we think would be a big mistake in --


WALLACE: If I may, Senator Kyl, just to cut this short, are you saying no deal on extending payroll tax cuts?

KYL: The payroll tax holiday has not stimulated job creation. We don't think that is a good way to do it. Before the end of the year, we will have discussions about what we're going to do on all these different programs.

WALLACE: Go ahead, briefly, Senator Durbin.

DURBIN: I can't believe that at a time when working families in this country are struggling paycheck to paycheck, when we need them to have the resources to buy thing in our economy, to create wealth and profitability and more jobs, that the Republican position is, they'll raise the payroll tax on working families? I think that just defies logic.

What we should do is to help these working families struggle through. President Obama has showed leadership on this. And now, the Republicans are walking away from lower and middle income families because they don't want to impose a small, small tax on the wealthiest people in America.

Listen, we can save Social Security. I agree with Jon Kyl. Let's be serious about it. Let's pay for this payroll tax cut by imposing the slight increase in taxes on the wealthiest people and replenish the Social Security trust?

WALLACE: Let me if I can Senator Kyl. I want to give you a chance to respond to that. I also want to ask you, if you will, briefly, the response to this, because economists say there's a real impact if you don't extend payroll tax cuts and employment insurance. And let's put it up on the screen.

They estimate and again both of these run out January 1st, that failure to extend the payroll tax cuts and unemployment benefits will cut GDP growth 1 percent to 2 percent next year, and cost more than half million jobs.

You say you question the stimulative affect. But according to these economists, there's a real danger if Congress doesn't extend both of those, put the country back into a recession?

KYL: Chris, I don't know who those economists are. I just read a piece by Art Laffer, who is a respected economist, who say that isn't true.

Here's the problem, when you are in a recession and you're in difficult economic time, as we are, and you need to put people back to work, as well as dealing with our deficit, how do you do that? You do it by enabling the economy to grow.

The best way to hurt economic growth is to impose more taxes on the people who do the hiring. And as a result, the Republicans have said, don't raise the existing tax rates on those who do the hiring. Instead, I hope we can get into this, explore the kinds of things that we did during the deficit reduction committee work to reform the tax code, eliminate preferences, credits and deductions, or reduce their value significantly on the upper income taxpayers, so that they end up paying more, but not through a tax increase on the rates either on capital gains, dividends or upper marginal rates.

Can you help us out?

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