Facts Matter, We Should Consider Them When Setting Policy
6 RIght Wing Lies About The Debt Ceiling Crisis
It would have been a difficult choice for me, do I choose liars, or do I choose spineless? President Obama, while spineless, deserves his fair portion of the blame, but when you are negotiating with liars and ideologues like the Tea Party and the Republicans what's a moderate to do? So I guess I'll go with LIARS. You see it's not just that the Republicans, the Tea Party in particular, weren't able to engage in this issue like thinking adults, it's that they lied about almost every aspect of the debate. In fact, now that there is a resolution to the problem, I find them creating new lies about the lies they've been spreading for months.
Here is the list of my favorite whoppers as put forth the by the right wing sausage factory:
Lie 1: "We don't have a revenue problem…"
I know the idea of a balanced, fact based approach is beyond comprehension at this point, but what the heck, let's look at the facts. You can see the history of tax rates since the 1960s here , but let's have more fun than that, let's list a few quotes from various economists that really call this issue into focus.
Fact: Corporate tax receipts accounted for 30 percent of US federal revenues in the mid-1950s. In 2009, they made up just 6.6 percent of federal revenue streams. (source: Alternet )
Fact: In the 1940s approximately 50% of the federal government's revenue came from corporations. For every dollar the government received from individuals like you, they received $1.50 from corporations. Today, for every dollar that individuals like you pay, the federal government receives just $0.25 from corporations. (source: Richard Wolff )
Fact: In 2008, the IRS revealed this past May, 400 Americans reported at least $110 million in income on their federal tax returns. These 400 averaged $270.5 million each. In 1955, by contrast, America’s top 400 averaged — in 2008 dollars — a mere $13.3 million. In other words, the top 400 in 2008 reported incomes that, after taking inflation into account, amounted to more than 20 times the incomes of America’s top 400 a half-century ago. (source: Alternet )
To tie this lie up in a neat little bow, Congressman Barney Frank noted yesterday that the revenue increases we need to avert harming the programs that so many Americans rely upon amount to
"$30 dollars per $1,000 for every dollar you make over $250,000. Verses cuts to education, cuts in healthcare, cuts for the homeless and cuts in medical care.”
How could we ever ask the wealthiest Americans to pay $30 whole dollars for every thousand they make? I mean they only get to keep $970, it's just so hard being rich.
Lie 2: "…We have a spending problem"
This is always the punchline to the joke that "we don't have revenue problem"…get it, "we have a spending problem." Funny right. Particularly with the facts above. This lie is special, because it is multiple lies in one.
The first lie is the implication that President Obama has gone on a wild spending spree and it is his spending that has led to the deficit crisis.
The second lie is the implication that the republicans by comparison have not engaged in reckless spending.
The third lie is that the republicans actually seek to remedy the deficit.
fact: when you look at this chart you see that minus the expenditures from the previous republican administration we would actually have a budget surplus of about $47 billion even with the stimulus spending.
Let's break these lies down one at a time. First, as you can see in these charts, and in this article , President Obama didn't go on a wild spending spree. The increases in the size of the budget results from President Obama's decision to move all of the unaccounted for, unpaid for spending of the previous republican administration onto the books and into the budget. When you look at the budget, you see that the additional spending that Obama has engaged in, were first, a stimulus intended to help mitigate the effects of the current economic downturn, and second, temporary because the stimulus is not a permanent budget item.
Which brings us to the second part of this lie. Our republican friends have not and currently do not engage in fiscal responsibility. The overwhelming majority of our deficit was brought on by the wars in Iraq and Afghanistan, Medicare Part D, the economic downturn, and the historically unprecedented war time revenue reduction we know as the Bush Tax Cuts.
fact: the primary contributors to our current deficit result directly from the policies of the Bush administration.
This brings us to the third and most troubling element of this lie. The republicans would have you believe that the recent debt ceiling struggle was a valiant effort on their part to cut the deficit. However, the items that contribute most to our deficit and that have long term and ongoing effects, the wars and the Bush Tax Cuts are not part of the conversation. The ongoing costs of these items will have long term and compounding effects over time. Whereas the items they seek to reduce in the name of deficit reduction were previously paid for and do not suffer from the same long term effects.
In short, the spending problem we have is largely a republican one and it is one that the republicans refuse to address but rather use as an excuse to attack other ideological targets like social programs, medicare and social security.
Lie 3: We Need To Reduce The Size Of Government So The Economy Can Grow
Republicans argue that it is the size of government that is strangling our economy, and it is government that has created these difficult financial times. The irony of this statement is that the economic crisis is actually the result of a lack of government. I know they wish to conveniently forget that our current recession was the result of Wall Street speculation, derivatives gambling, and predatory mortgage lending. These are all business, not government. Had we had better regulation, we might have avoided the recession entirely.
Of course there is a second factor that the republicans seek to exploit. Because of the collapse of the economy, more people are on unemployment, food stamps etc. So the costs of these programs has indeed gone up. And as the republicans point out, as a portion of GDP it looks to be a large increase in the size of government. But if you think it through, the cause of this was unethical business practices which led to high rates of unemployment and poverty not increases in the size of government. As the safety net goes into effect helping struggling Americans, the overall growth of GDP has slowed and so yes it looks like the government is growing in size. In reality it isn't, but that doesn't stop our republican friends from exploiting the failure of their political philosophy as an opportunity to launch an assault on big government.
Fact: The increase in the size of government the republicans point to is actually the shrinking of the economy as the result of too much big business.
Lie 4: Reducing Spending Will Grow The Economy
We've already tried this approach during the great depression. Before the economy had completely recovered, to avoid growing deficits we began to cut government spending. FDR quickly discovered that cutting government spending during an economic downturn guarantees more of the same. You can read more about the dangers of cutting government spending during an economic downturn in this interesting series on deficits and how different presidents handled them .
Lie 5: Obama Didn't Have A Plan For The Debt Ceiling
This is one of the more recent talking points to come out, and it is also the easiest lie to debunk. If Obama didn't have a plan for the debt ceiling then why did both Eric Cantor and John Boehner storm out of negotiations with President Obama? I guess they were reacting to his non-plan. It was his non-suggestion, of his non-ideas, for a non-grand bargain that so angered them that they had to break off the negotiations.
Lie 6: We Can't Raise Taxes On The "Job Creators" In This Fragile Economy It Will Hurt Job Creation
This is several lies in one. First, if the wealthy of this nation were "job creators" we wouldn't be in the middle of a recession. They are sitting on record amounts of cash, the likes of which we have not seen since the years leading up to the great depression. If putting more cash into the hands of the wealthy were going to create jobs, we would not have high unemployment now. The wealthy create jobs when they think the products and services they provide are in demand, not because they recently received a tax cut.
This brings us to the second lie within this lie, that we are suffering from a supply problem, not a demand problem. Our economy is sluggishly growing not because of a lack of supply, but as the result of a lack of demand. This is precisely why cutting government spending is so foolish. We need to create demand in whatever ways we can until the economy fully recovers, and yes for now that includes additional government spending.
Lie 6 - The Granddaddy Whopper Of All Lies: The Debt Ceiling Crisis
Republicans and the Tea Party brought us to the brink and some argue actually did push us to the point of severe financial consequences based on the lie of the debt ceiling crisis. A simple procedural vote needed to cover the expenditures of their own doing became a several month's long fabricated crisis. Rather than focus on jobs, they created a crisis.
In case you hadn't seen these numbers, here is the evidence that the crisis that nearly brought us to financial ruin was simply brinkmanship by the petulant children that are the republicans and the tea party:
fact: We have raised the debt ceiling 70 times since 1960
fact: We raised the debt ceiling 18 times during Reagan's presidency
fact: Republicans voted to raise the debt ceiling 7 times during George W. Bush's presidency
fact: This is the best number of all, 130 of the current Republicans in congress voted to raise the debt ceiling during Bush's presidency
The most troubling lie of all is that this is all some sort of mystery, that we are stumbling around in the dark uncertain about how we got here or how to get out of this mess. We know the answers to so many of these questions. We have historical precedent. We have previous examples like the actions of FDR during the Great Depression. We know that cutting taxes does NOT create more revenue . We have decades of data. Yet we pretend that it is all a mystery. We pretend that the exact opposite of what we should be doing is the best thing to be done.
The republicans choose to believe that there is no such thing as gravity and then they force us all to jump out of the window to prove their theory. They are free to passionately believe whatever they want, but for the rest of us who know better, why must we jump when we know the terrible results that await us below?
