Monday, February 8, 2010
Really George Will?
The purpose of this blog is not to point out right-wing idiocy. There are thousands of other websites that do a more than adequate job if you have any interest in the subject. (I have very little.) This is not the place to read about Sarah Palin’s latest wildly hypocritical gaffe. I find these topics boring- the analysis is straightforward: she preaches one thing, she does another, she’s a hypocrite, she appears unintelligent, she’s shamelessly making millions off the ignorance of her easily excitable followers… yeah, yeah, ok, I get it.
Up until this point a guy like George Will I have held in higher regard than your generic right-wing hack. He is a Pulitzer prize winner. He looks like a wise Professor. He makes a conscious effort not to appear shamelessly partisan. So after reading this article where he touts a Republican politician’s budget and tax reform plan that is almost too ridiculous to be aired on Fox News – I had to respond.
This is a summary (George Will’s summary, not mine) of Paul Ryan's tax/healthcare/balance-the-budget plan that the wise old conservative sage is so fond of:
Tax cuts/Spending hikes: (money out)
-Under 100k instead of paying 25-35% you pay 10%
-Over 100k you instead of paying 30-40% you pay 25%
-Corporations pay 0% instead of 35%
-No tax on interest
-No tax on capital gains
-No tax on dividends
-No tax on estate transfers
-1/3 of FICA tax for people under 55 goes into personalized private savings
-2300$/individual, 5700$/family credits for private health insurance
Tax Raises/Spending cuts: (money in)
-8.5% value added consumption tax
-Social Security starts paying out at 75 instead of 65
Really George Will? This is going to balance the budget? You’re going to slash taxes, provide universal health care, AND balance the budget with just a VAT and an Eff-You to the 65-75 year old population?
That’s some astoundingly ridiculous math. What is even sillier than the math though, is that George Will thinks this is somehow a politically feasible plan. You might be able to convince the unwashed masses that an 8.5% tax on EVERY SINGLE THING THEY BUY is a good deal for them in exchange for tax cuts on interest, dividends, estates, and capital gains they will never realize – but there is no way, just no way you can raise the SS payout age to 75 without pitchforks in the street.* I bet George Will couldn’t find me fourteen Palin-fans who would agree to that – and yet this is the plan he says succeeds in “refuting the idea that Republicans lack ideas.”
The fact a purported non-partisan conservative like George Will felt it necessary to spend his entire Washington Post column defending the GOP against the “party of no” claim is odd. The fact he did it by showcasing this unserious set of proposals leads us to only one conclusion – George Will is nothing more than a well-dressed waterboy for the GOP. He is Sean Hannity with people skills. He is Karl Rove with a nice head of hair. He is Rush Limbaugh without the oxy addiction. He is not under any circumstances to be taken seriously. This is the last time he will ever be discussed on this blog.
* George Will backs up his laughable notion that raising the SS age to 75 is good policy and palatable politics with this head scratching statement: “The system was never intended to do what it is doing — subsidizing retirements that extend from one-third to one-half of retirees' adult lives.” One-third to one-half? George, life expectancy in America is 78 years old! Payments kick in at 65. That’s 13 years! 16.6 percent of their life (21.6 percent if you want to use the misleading term “adult life”). According to George Will, the average American is living to 89 on the low end and 112 on the high end! Just die already! Going by George Will’s numbers it’s no wonder conservatives keep repeating “America has the best health care system in the world”. They think the US is packed with millions of benefit budget busting centenarians!
One of this blogs loyal followers demanded I run the numbers to see if GW's pet proposal was mathematically feasible (even if it's morally bankrupt) as a budget balancer.
Income tax cut that may actually be a tax increase when you factor in the vague statement "no deductions". Who knows about the revenue implications - lets call it a push.
VAT tax on the consumption section of the GDP: 6.5% (after a few exemptions for food, clothing, and such that the GOP would undoubtedly insist would be included) of 60% (percent of GDP that's consumption) of 14 trillion (GDP) = 546 billion
SS payouts saved by dicking over the 65-75 crowd: 293 billion
839 extra billion IN
Subtract 370 billion in corporate tax receipts, subtract 30 billion in estate taxes, subtract 125 billion in capital gains tax receipts (the 125 figure is volatile and debatable, I'd argue 125 is way too low long term) subtract 300 billion in FICA taxes diverted into private accounts, 100 billion in extra health care costs, before we even look at dividends, excise taxes we're going to eliminate because of the new VAT, and other stuff we're at
925 billion in lost revenue
My qualitative analysis was right. The numbers don't work to even curb the growth rate of the debt, much less pay it off. They don't even come close. As I suspected, the only way they work is with a voodoo economics argument about the magic that tax cuts will have on GDP growth.
Posted by OP at 6:41 PM