What Republicans Want… I Don’t Know

gop_elephant__question_lgAs the fiscal cliff debate unfolded over these past couple of months, one thing became clear – the Republican position is murkier than ever. I honestly have no idea what the right wants concerning issues like entitlement reform, spending cuts, and the debt.

We know Republicans want tax cuts; specifically for the wealthy. The fiscal cliff became a battle waged solely over the Bush tax cuts for top earners. The small percentage of people affected by those top-tier tax cuts became the most important Americans, and the Republican Party was willing to let taxes increase on everybody in order to make an ideological statement.

The logic of this position is still baffling. Republicans were fighting to keep taxes low for the top 2 percent with the threat of raising taxes on 100 percent of the population. While arguing higher taxes would hinder economic growth, more than half of House Republicans voted to go off the cliff and raise taxes on everyone. It was an illogical position from the start.

We can be sure Republicans want to cut taxes for the rich; however, the same cannot be said for the middleclass and less affluent. Although there was very little discussion over the payroll tax cut, an EPI study concluded extending the payroll tax holiday would provide the greatest benefit to cost ratio of all the taxes that were scheduled to increase on January 1. Disappointingly, Democrats did not fight too hard for an extension, but it shouldn’t have even been a fight. Why would the Party so concerned about cutting taxes for the top 2 percent be against extending tax cuts for everyone else? Possibly because the payroll tax cut largely benefited the middleclass, not campaign donors “Job Creators.”

Delving deeper into convoluted Republican positions, one doesn’t have to listen to John Boehner too long to hear talk of reforming entitlements and getting the debt under control. Both ideas sound very conservative, but without any substantive policies back those ideas, it’s nothing more than base-appeasing rhetoric.

Concerning entitlement reform: throughout all the negations, Republicans proposed no actual entitlement reforms, instead, demanded President Obama lay out his own reforms. Besides being a cowardly political move (fearing reform proposals would be fodder for a future attack), why should that be the President’s responsibility? The President wanted to raise taxes and Republicans wanted to reform entitlements. It would make sense for each side to devise a plan according to their desire. The President did his part, but Republicans did nothing, and then blamed Democrats for inaction.

Furthermore, President Obama actually offered changes to Social Security. He proposed calculating Social Security benefits with a chained CPI method. Fancy talk for a benefit cut that slows growth in Social Security spending. Republicans rejected this offer because it would have meant going against their illogical and ideological position to never raise taxes (on the rich). So what do Republicans mean when they speak about entitlement reform? They offered no ideas of their own and rejected the one put forth by President Obama. To be fair, the Ryan Plan did offer changes to entitlements, but they were not reforms. They fundamentally changed the programs; drastically cutting benefits, with no evidence of actually working in practice.

Beyond entitlement reform, is talk of debt management. But where is the evidence Republicans care about decreasing the debt? Their whole position is to lower taxes and magically increase revenue. It is no coincidence that as tax rates are at all time lows, tax revenues have also been at all time lows. Republicans say closing loopholes will bring in revenue, but have yet to mention a specific loophole they are willing to close. They say they want to rein in entitlement spending, but haven’t offered any reforms to those programs besides simply cutting them. And they say they want to cut wasteful spending, but at the same time favor allocating more money to defense than the next 13 countries combined (and still want more!).

Truly, I am confused about the Republican position. Yes, they want lower taxes, but really only for the rich. Other than that, who knows? They talk big about reforming entitlements and decreasing our debt, but none of their policies reflect those beliefs.


The Purpose of a Tax

Taxes* serve two purposes: the first is to provide governments with revenue, and the second is to deter or regulate activity i.e. sin tax on alcohol or trade tariffs.

Notice, neither purpose’s main role is to serve as a catalyst toward economic growth like Republicans believe. Republicans are confident, just so sure, that if we lower taxes the economy will prosper. But understanding the purpose of taxes, and just basic tax history, there is little evidence to support the Republican model. Tax rates have been consistently decreasing for decades, yet the economy has still had its ups and downs. The point is economic growth is not solely determined by tax rates – it’s not that simple.

I think Democrats better understand the purpose of taxes. Democrats do not argue higher taxes lead to economic growth (because it is true at a certain point when taxes go too high they will deter economic activity). When liberals reference the higher Clinton era tax rates, they are referring to the strong economic growth that went on during that time. The significance being high tax rates did not deter economic activity. They did, however, serve the role of raising revenue, which led to 4 years of a balanced budget.

So Republicans are framing the debate around taxes incorrectly. It’s not; we need to lower taxes because that will lead to economic growth. Instead it’s at what rate should taxes be set in order to maximize revenue, but at the same time not deter economic growth.  So the tax rate should not be viewed as an economic starter, but only an economic deterrent.

Given our current tax code, it’s hard to argue that it is high rates that are hindering economic growth. Taxes were slightly higher in the 90’s and drastically higher in pervious decades, and in both cases economic growth was much greater. If taxes now are lower than during an era of greater economic prosperity then there is no reason to believe lowering them more will solve the problem. So the basis of the Republican argument, taxes are too high, is really an unfounded claim.

Now, this is not an argument that government should try to squeeze every penny out of taxpayers it can without hurting the economy. But given the country’s increasing deficits, under funded schools, crumbling infrastructure, growing numbers of people living in poverty, a disappearing middle-class, and a slew of other problems, more revenue is not inherently bad.

The larger point in all this is Republicans’ answer to every problem is to cut taxes. That’s obviously not the solution. Tax rates are historically low, and there’s no evidence that further reducing them would spur on economic growth. Instead we should set tax rates so they can serve their purpose of raising revenue without being a drag on the economy.

We need to look at other ideas to promote economic growth outside of just ‘cut taxes!’ This could be rebuilding our infrastructure, investing in new infrastructure like high-speed rails, investing in new alternative forms of energy, or creating policies that promote hiring here in America rather than overseas. Here is where the Democrats have an edge, the stimulus package that was passed, and The American Jobs Act (that was not passed) were filled with ideas to boost economic activity. They were ideas that went beyond cutting taxes for the rich in the hopes the wealth will trickle down. Although some may disagree, most economists concur that the stimulus did work, and the American Jobs Act would have reduced unemployment.  Economic growth will not come from padding the pockets of the wealthy, but from investments aimed at putting people back to work.

*To make things simple, taxes in this post refers to individual tax rates

What’s Really Holding Back the Economy?

If you ask Republicans, “What’s wrong with the economy?” or, “Why is there such little growth?” They all give a similar response. They say, “government is too big, it is spending too much.” They say, “the President is not creating a business-friendly environment – the President hates small businesses!”  According to Republicans, if only government would get out of the way, and let businesses do their thing then we would get the economic recovery America has been waiting for.

If this story were true, we would expect to see stagnate or declining business investment accompanied by skyrocketing government investment. This would illustrate an economy in which private sector growth is being hampered by too much government (the crowding out argument). The problem is, the ‘Obama hates small businesses and government is spending too much’ story does not line up with what is actually happening in the economy.








In fact, what’s happening is the exact opposite of what should be happening if the Republicans were correct. This graph shows non-residential investment, which can be understood as business investment, and government investment. Since President Obama’s policies have gone into effect, business investment has actually gone up, not down, as conservatives want us to believe. And government investment is actually at an all time low – not at socialist levels as our friends from the right continue to insist.

Now, I am not trying to say the private sector is back to normal and doing just fine, but the story that too much government is holding back this recovery just doesn’t align with what is actually going on. What’s actually going on suggests we need more government investment, not less.  The economy is struggling due to a decrease in government. This came mostly from sharp cuts to state and local governments, which in turn wiped out more than a million jobs.  It is precisely this “American style austerity” Republicans have been demanding that is hindering our economy, not government.

The proper response to the economy we face is not to blame government and decry any government expenditures, but to realize government can and should be used to help with this recovery.

3 Reasons the Claim “Half of Americans Don’t Pay any Income Tax” is Bogus

In a recent post, a comment was made by ‘Chris,’ who makes the claim, “nearly 50% of Americans… do not pay an income tax.” This line has become a standard talking point for right-wing politicians, pundits, and Fox News enthusiasts. It has been circulating for a couple of years now, in part because it is ‘true’ (yes, the claim is technically true, not denying that), but also because it plays into the conservative narrative that the downfall of this country is due to free loaders who are dependent on government.

The first problem with this line is many times it leads to people, sometimes ‘important’ people like Sean Hannity, claiming that half of Americans pay no taxes at all.  That is just patently untrue – simply red meat for his conservative base.

This leads to a second problem because implying a certain group of people do not pay any taxes only perpetrates the belief that those in poverty just want handouts and are not paying their fair share. This false belief turns a blind eye to the fact that there are more taxes than just the income tax. The income tax happens to be a very progressive tax. So it does not affect low-income people as much as high earners, but by no means does it follow that they do not pay their fair share.







This graph shows the effective tax rate paid by each income group. We see even those at the bottom still pay an effective tax rate of 17.4 percent. Yes, higher earners pay more (not by much), but the idea that low-income people are free loaders is simply not true. Further, if you take into consideration the past few decades where those in the top income bracket saw their income rise by close to 275 percent, while others only saw modest income growth begs the question as to who is really not paying their fair share.

Third, this claim also seems to purport those not paying income tax are either not working or somehow cheating the system. Both of which are untrue.  A large group of those not paying any income tax are the elderly. Their main source of income is Social Security, which is not taxed as income.  The other main reason 48 percent of people do not pay any income tax is because they are living in poverty and do not earn enough.  The various exemptions and deductions all people receive make their income tax rate zero.

These are not people who aren’t working or cheating the system. In fact, according to Lindsey Graham, ‘It’s really American to avoid (paying) taxes.” Full Disclosure: That quote is taken out of context. What he meant was that it is American for rich people to avoid taxes, but for the less fortunate, avoiding taxes is being a free loader.

That’s really the issue here; Republicans demonize the poor while putting the rich on a pedestal. They use this line as evidence the rich are already supporting the lower class through high taxes and taxing them more would be economic suicide. Republicans want us to believe that hiding and sheltering income to avoid taxes is patriotic, but when low-income households use standard deductions to decrease their tax burden they are leeches on society. It’s interesting we never hear about the 20,000 plus Americans who make over $200,000 a year and pay zero in income tax. That’s because those are the ‘job creators’ and we don’t attack them.

Paying taxes is about paying your fair share – both parties believe that. Republicans are just going after the wrong group of people.

To Republicans: Stop Wasting Time on Problems that Don’t Exist

Not only does the Republican Party waste time and energy focusing on a couple of nonexistent problems (during a time when the country faces a lot of ‘real’ problems); they are also disenfranchising millions of voters while treating them as second-class citizens. So what ‘problems’ am I referring to? Specifically, required drug testing for welfare recipients, and recently drafted voter ID laws.

Red states across the country are doing their best to enact both of these types of laws. First, there is the issue of mandatory drug testing for those on welfare. There are a few reasons why my Republican friends should be against this law. For all the Ron Paul enthusiasts and strict Constitutionalists – the law is a breach of privacy, an overreach in government’s power.  A lower Florida Court said it was unconstitutional because it deemed it an ‘unreasonable search,’ which violates the 4th Amendment.

Now, to my fiscally conservative Republicans, the law doesn’t make fiscal sense! Florida, one of the first states to implement drug tests, lost money on the program. Why? Well only 2.6 percent of recipients failed the test.  The other 97.4 percent passed and were reimbursed for the cost of the drug test. Those reimbursements cost the state close to $120,000, far exceeding the benefits the state would have had to pay out.

The larger issue here is not that the party who claims to be fiscally responsible is perpetually proposing fiscally irresponsible laws, or that the party who believes they write laws with the endorsement of our Founders is enacting laws that are unconstitutional, no, the bigger issue is Republicans created this law to solve a problem that doesn’t exist. They want us to believe it is to protect taxpayers’ money, but it is just an attack on a  group of people they do not like. It is an attack on a group of people who they see as the problem. Republicans view those on welfare as a drain to the economy, and a black eye to society in general. Although it takes up a small percentage of the government’s budget, Republicans want us to believe it is the welfare system that is bankrupting the country.

This may seem cynical on my part, but I think their new objective to create stricter voter ID laws only reinforces this view. Let’s start with this – voter fraud is not a problem. Voter fraud that would be solved by stricter ID laws is even less of a problem. The rampant voter fraud Republicans want us to believe is going on is a myth. In Florida, where they are trying to implement harsher voter ID laws, there are more shark attacks per year than cases of voter fraud. It is simply a problem that does not exist, but Republicans have continued writing these laws because the laws go after groups of people they do not like; people who vote Democrat.

Back in 2008, when Republicans lost the Presidency they realized they lost by very small margins in a few swing states.  Well, one way to swing those margins in their favor is to prevent people who vote Democrat from voting. It just so happens the voter ID laws being proposed by Republicans will adversely affect black and minority voters – a typically strong base for Democrats. You’ll notice these laws don’t try to reform absentee voting because the majority who vote by absentee ballots are Republicans. Still not convinced? The voter ID law being proposed in Texas says a gun license is an acceptable form of identification but a college ID is not. Must just be a happy coincidence that gun owners tend to vote Republican and college students tend to sway left.

Republicans frame their argument for these voter ID laws as upholding the sanctity of democracy. What they are really trying to do is systematically create their own democracy, one which works to their advantage. Both of these laws are to antagonize a base of the Democratic Party Republicans do not like. They serve no purpose but to prevent Democratic citizens from voting, and demean them as humans. Instead of tackling real issues, Republicans are creating problems that are in accordance with their ideological worldview.

If ACA is Struck Down… What’s Next?

Any day now the Supreme Court will give its ruling on the  Constitutionality of the Affordable Care Act, a.k.a. Obamacare.   When the hearings were taking place, back in March, the media buzz did not spell a favorable outcome for the President and his healthcare law.  With signs pointing towards a 5-4 decision against the bill it only begs the question as to what’s next? Few believe that our healthcare system is perfect.  There are millions of uninsured people, costs are ever-increasing, and ideas to fix those problems are scarce at best.  Whether you like the President’s healthcare plan or not at least it was an attempt to fix those issues.  So again, if the bill is struck down – what’s next?

Assuming the ACA is deemed unconstitutional we’ll have to start over and figure out a solution to the two main problems: Americans without healthcare, and the skyrocketing costs of healthcare.  Here are some ideas.

First, there needs to be competition and transparency in the insurance market.  The current insurance market creates a system where insurance companies are rewarded for covering healthy people while denying insurance to the sick. How do we fix this problem? Get rid of denying healthcare due to pre-existing conditions. Which by the way is part of the ACA that is bipartisan supported. Then, set a minimum level of coverage that all insurance plans must provide.  This creates transparency in the system by guaranteeing some type of standard coverage on which all people can rely, and prevents insurance companies from charging high premiums for plans that cover little.  It also creates a competitive market where insurance companies will work to offer less expensive coverage in order to attain more customers. Just like the free market is supposed to work.

Second, programs already in place need to be more accessible to more people.  Allowing more people to enroll in Medicaid potentially drives down costs in the long-run and insures more people at the same time.  A recent study was done where researchers enrolled uninsured people into Medicaid and the result was substantially lower costs (almost half as expensive).   By giving people, who tend to use emergency rooms for their primary care, actual primary care, it dramatically reduced costs.  In doing so, no longer will minor illnesses or nagging injuries turn into much more serious and much more expensive emergency room visits.  This means more people being covered with fewer government dollars being spent.

Third, we have to keep Washington out of it. The inefficiencies of Washington are becoming more and more evident, and those inefficiencies cannot be carried into the healthcare market.  An independent board or committee, outside of Congress, needs to be implemented to control things like Medicare costs.  Too often is Congress paralyzed by the fear of voters and campaign contributors to even mention changing Medicare.  Well that needs to be changed.  This is why an independent board works well.  It’s main concern will be ensuring the solvency of Medicare and not catering to special interest groups.

Finally, we need to start paying doctors based on quality not quantity.  Our current system rewards doctors for performing unnecessary tests.  Rather than paying on a per procedure basis, we should be paying for treatment of the patient. In this system, doctors will be paid for treating someone’s illness as whole rather than all the individual tests.   This should work to reduce overall costs.

These are measures that should have bipartisan support. Republicans should like them because it lets the free market dictate costs and it lowers costs, which means lower deficits. Democrats should like them because they provide insurance to more Americans.

One last note: If you added an individual mandate to this list you would have the foundation for Obamacare. Sadly I didn’t come up with these ideas myself, no, these are all reforms created by the President’s healthcare law.  And as I said, most of these ideas should have bipartisan support. The problem; however, in the current political climate anything the President does is immediately wrong.  Even though much of the law is based on the Republican’s plan from the 90’s, the right now views it as a march towards a socialist takeover of healthcare.

The Affordable Care Act is not a perfect plan by any means, but it does have a lot of good ideas and possible solutions to the problem of healthcare.  Which arguably is the biggest problem the country faces.  It’s a shame Republicans have completely rejected it because it was implement by a President they don’t like.

Waiting For Washington

After a couple consecutive jobs reports filled with not-so-great news, May’s jobs report only worsened that trend. 69,000 jobs were created (way less than expected) and unemployment ticked up to 8.2 % from 8.1%.  A pattern is developing. In both 2010 and 2011 the beginning of the year was marked with the hope of economic recovery; however, come April and May those hopes were stunted by a slumping economy – exactly what we are seeing now.  So the question I’m asking is how long is Washington going to continue to do nothing?

The Republican’s fix to our economic woes is to reduce the national debt by decreasing government spending and cutting taxes – somehow this will get the economy back on track. It seems the right forgot Europe already tried spurring on economic growth through spending cuts and it only made their economies worse off.  Also, counter to their goal, the austerity measures implemented have increased the debt of many of the Euro countries.

Phase 2 of the Republican plan is tax cuts, which have proven to be incredibly ineffective especially when compared to actual government consumption. Not to mention tax cuts only add to the national debt.  Republicans need to stop laboring under the delusion that tax cuts pay for themselves – (cough) the Bush tax cuts (cough).

So if we follow the Republican plan, not only will the national debt increase, but it simply will not help with economic growth.  What we need for a robust recovery is an increase in actual government consumption. Government needs to invest in things like  public works projects and infrastructure rebuilding. The key to recovery right now is not to drastically cut spending but to increase spending where it can make a difference. (I will admit; I’m upset few Democrats are willing to take this stance, but it is due in large part to an uncompromising right who views any government spending as a socialist policy)

I know Republicans reading this will be fuming at the thought of more government spending. I can hear their arguments now; ‘we’ve already spent trillions of dollars and what do we have to show for it – unemployment above 8%.’   The flaw in their argument though is government consumption is relatively low given the magnitude of the recession. The explosion in government expenditures came mostly from increased safety net expenditures (unemployment benefits, food stamps etc.), ever-increasing health care costs, and tax cuts, not from government consumption and investment.  We need government spending that works toward putting people back to work, only then can we expect our economy to return to normal.

One last note: I’m not asking for extreme left-wing policies.  All I’m asking for is government consumption and investment to be at the same levels as when President Reagan faced a recession.

Stop Denying Science You Don’t Like

When the weatherman predicts rain, do we assume he is just making it up for a good laugh? When a doctor prescribes us medicine, do we not take it due the dubious nature of doctors?  When we walk into a building, are we terrified the building is going to collapse because the engineers who designed it know nothing about structural integrity?  When an astrophysicist discovers a new planet, do we just chalk it up to a speck on the telescope? When a chemist discovers a new life-saving compound, do we brush it off as some scientist trying to make a name for him/herself?

The answer is no.

Whether it is something as simple as listening to weather reports or discovering galaxies far, far away we trust what the scientists tell us.  We trust science when it comes to everyday aspects of our lives like assuming medicines will work, or the internal combustion engine in our car will start.  We trust science on issues we don’t have a direct connection with like the discovery of new planets or the discovery of new species.  We trust science on issues both big and small.

What’s interesting though is some people, like Republicans, accept all science except when they don’t like it.  They accept all science except when it comes to things like climate change and evolution.

Republicans have a strong religious base that believes God created the world. So Republicans deny evolution. A politically convenient move.

Similarly, accepting climate change means accepting the fact that burning fossil fuels is bad for the environment. This means billion dollar subsidies for big oil becomes a little sketchy.  This means lessening regulations on oil companies can’t simply be justified in the name of ‘job creation.’  Denying climate change, denying that one area of science, is much more convenient for them considering many of their major campaign contributors are big oil.

As Upton Sinclair put it, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

Basically, Republicans accept science, with one caveat; they deny it when it is politically inconvenient.

Skeptics argue climate change is not an exact science, and yes, science evolves and it can change, but these climate change deniers have offered zero valid counter-evidence.  They have come up with nothing debunking climate change; actually scientists have disproved all their claims.

They point to the fact that it was cooling in the 1970’s, well that was due to particulate pollution that blocked the sun’s rays.  The EPA has since banned those types of pollutants because they caused cancer. They point to sun-spots as the problem, which I debunk here. They point to inaccurate temperature measurements, which was found to be untrue by a Koch-Brother funded study (they were not happy about the results).

The list goes on, but in reality over 97 percent of scientists agree climate change is real and it’s man-made.

Creationists are even worse.  They’re just sticking to the story that God created the world with the only evidence being that the Bible says so.

The evolution deniers in the Republican party do not bother me as much as the climate change deniers. Climate change has real consequences. We are already seeing the devastating effects of a warming planet and it’s only going to get worse.  Solving climate change is going to be difficult in its own right; the last thing we need is to have one political party deny its existence.

So Republicans need to stop denying sciences they don’t like.  At some point real-world problems have to take precedent over appeasing campaign contributors.



The Real Moral Issue is Climate Change

In 2010, when Republicans took over control of the House, they changed the national dialogue from economic recovery to reducing the federal debt.  They persuaded Americans that the central issue was no longer recovery from the worst recession since the Great Depression, but instead the national debt.  They claimed this was the country’s biggest problem.  And I think people believed it because they framed the debate around the children.  Republicans always claim our rising national debt will only lead to a desolate future for our children and grand children.  They turned the national debt into a moral issue, and it worked.

However, I think there is a bigger, more pressing moral issue at hand that few Democrats and absolutely zero Republicans are tackling: global climate change.  The national debt, in all honestly, is not at unsustainable levels, and is relatively fixable; unlike climate change, which is rapidly getting worse and quick fixes are no longer a possibility.

The earth is warming at unprecedented levels.  It’s causing problems now. And the ideas to solve the problem are sparse and seldom addressed.  Hell, half this country doesn’t even believe it’s an actual problem, which is sad because climate change is the real moral issue.  Natural disasters are becoming more frequent and more violent, and they’re only getting worse. Were seeing terrible droughts in areas like the southern United States.  And this is just America.  Sea levels are rising and it’s wreaking havoc around the world.  Island nations like the Maldives are literally disappearing due to rising sea levels. If nothing changes the country will be erased from maps by the end of the century.

That is a moral issue.

Yes, the national debt is a problem but not nearly as problematic as climate change. Republicans are so concerned about the children, but continue to chant ‘drill baby drill’. Fracking is becoming wide-spread in this country. Funding for innovations in green energy pales in comparison to oil subsidies.  Presidential candidate, Newt Gingrich, mocked all-electric cars and made fun of the possibility of using algae for fuel.

If Republicans (Democrats are to blame here as well) really care about the children they need to focus on the real moral issue of climate change.  The national debt if left unaddressed will cause problems, but if climate change continues to be neglected it will cost billions of dollars in damages and the loss of many lives.  If Republicans really care about the children I ask them to stop believing oil is the answer to all our problems, and realize climate change if left un-tethered is the absolute biggest problem our country and world faces.

P.S. I’ve been at the Cleveland International film fest all weekend and have seen quite a few environmental documentaries.

Republican’s Misleading Report on Obamacare

The terms revenue and cost are important to any financial report.  Revenue is the amount of money earned, while cost is the amount spent to earn that revenue. Subtract cost from revenue and you have net earnings. Together the two tell a lot about financial stability, but separate they tell very little.  This may sound elementary, which is why it is a shame many Republicans fail to understand this.

In a recent report the CBO updated their analysis of the Affordable Care Act aka “Obamacare.”  Republicans read the report as a glorious confirmation of what they knew all along – Obamacare will cost the nation billions and billions of dollars.  Specifically they are referring to the new estimates of the ACA, which will cost $1.7 trillion as opposed to the original $940 billion. (There are reasons why this number increased, mostly because the reports cover different spans of time. That is a separate issue though) Republicans fail to either admit or realize the $1.7 trillion is only the cost side and without knowing the revenue side the number means very little.  Republicans don’t mention this because revenue also went up and the projected overall net costs actually decreased.  Interesting Republicans do not mention this.

This is one of the most misleading talking points put out by the Republican establishment.  Or maybe it is their absolute disdain for the President and his policies that have put their preconceived notions above the facts.