Obama's deficit plan "relies heavily" on taxing the top

As it well should, really. The elephant in the room (har har) that’s plagued our deficit discussion for the longest time has been the Bush Tax Cut. I’ve said it time and time again that anyone who passed 6th grade math can figure out that cutting a couple trillion dollars worth of taxes is going to cause a massive budget swing unless spending is sliced down, something that emphatically did not happen at the time when we were all enjoying our checks in the mail.

CBS News reports that the plan includes around $1.5 trillion in new taxes. $800 billion comes from repealing Bush-era tax rates for households making over $250,000. The plan includes $580 billion in cuts to mandatory benefit programs, including $248 billion from Medicare. And it would close some corporate tax loopholes and limit certain tax deductions. $1 trillion in savings over 10 years is projected from the withdrawal of troops in Iraq and Afghanistan. Overall, the plan seeks $1 in new revenues for every $2 in cuts.

That 2:1 ratio is fairly important, because it highlights the difficult position Republicans will be in if they feel like fighting against this. When you have a deficit, there are two paths to fixing it: increasing income and decreasing expenditure. Doing all of one or the other is a damn near impossible feat, as anyone who’s been forced to pick up a second job will tell you, and the smartest thing to do is blend the two.

By contrast, Republicans not only are adamantly against tax increases (or repealing irresponsible cuts), they want more cuts. This is the equivalent of deciding that in a time of personal debt your one job is sapping too much of your energy so you decide to go from full-time to part-time. The amount of budget slashing you’ll need to do is going to become outrageous, and we just don’t have that much wiggle room in there.

In case you’re curious where all your tax dollars go, you can look at this handy guide, and realize that without the $1T in revenue increases, the only things with that much money kicking around are Defense, Health & Human Services, and Social Security. You can guess which one the GOP would love to eschew entirely, which would be pretty much the only way to make a meaningful dent in the vast money gap those tax cuts are causing.

The Republicans continue to put this in the guise of “class warfare”, but what they don’t realize is the war has been going on for years, and the wealthy have been kicking our asses. This is a meager attempt to even the playing field a bit.

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One response to “Obama's deficit plan "relies heavily" on taxing the top

  1. This will be great, if only Obama can get it passed/implimented. If he doesn’t, not only is he done next election, so is the rest of the Country, I think.

    When will people wake up and start kicking Republican’s behind into actually doing something *positive* for the economy down there?

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