The Congressional Budget Office (CBO) has scored the Republican Trojan Horse aka the payroll tax extension bill and determined that it would likely raise the deficit by $25.3 billion over ten years. What happened to the GOP mantra that cutting the deficit is job one?
In one bill, Republicans violated two of their most sacred principles: increasing the deficit and cutting taxes without paying for them. The paying for tax increases bit is a new Republican principle. Prior to the election of Obama, they did not believe in paying for tax cuts because they assert that tax cuts boost the economy so much that they pay for themselves.
Of course, any tax cut proposed by Obama would not boost the economy, they say, so they must be paid for.
Republicans goal: Shift political blame for payroll tax hike to Obama
Republicans do not want the payroll tax extended. Some don’t on because they say it hurts Social Security, a program they have tried to kill since the 2930’3. Others do not want it increased because it would help the economy and give Obama a win.
The GOP has unanimously defeated Democratic bills to extend the payroll tax holiday three times in the last month. They are feeling heat from their constituents, so they have created a Trojan Horse full of all the K Street goodies they could pack in along with a little GOP social engineering. House Speaker John Boehner (R-OH) indicates he plans to vote on the 369 page GOP bill next week.
This proposal is dead on arrival, if not in the Senate, it will be vetoed by the President. The Republicans know this, so they think they have a way to look good when they kill they payroll tax cut again because they will force Democrats to vote ageist it, and if it passes for some reason, Obama will veto it.
In Congress, this type bill is known as a Christmas tree, but there is no Christmas spirit in it. It extends the payroll tax, but it does so much more. The bill would force the President to issue a permit for the Keystone XL oil pipeline within 60 days, or report to Congress why not. The Administration has delayed issuing the permit until concerns about the environmental impact of the pipeline can be sorted out. There are concerns about the pipeline’s risks to the nation’s largest aquifer.
In addition to that early Christmas gift for oilmen, the GOP bill would protect doctors from scheduled fee cuts in Medicare payments (Doc Fix). It would also reduce the number of weeks an out of work person can collect unemployment benefits, and make it harder for them to collect at all.
They threw a little social engineering in as well. They added a provision to require drug testing as a pre-requisite for collecting unemployment benefits. They also will deny federal money to states unless they take measures to insure that no one receiving public assistance can spend money at liquor stores, strip clubs, or casinos.
CBO says bill increases deficit
All of these Christmas gifts to oilmen, doctors, millionaires (who escape a tax increase), and Evangelical Christians opposed to drinking and gambling, cost money. The Congressional Budget Office says the bill will increase the deficit $25.3 billion over 10 years, with a caveat.
The costs are as follows:
- Payroll tax reduction: $121 billion
- Unemployment Insurance extension: $34 billion
- Doc Fix: $39 billion
- Small business tax expensing: $6 billion
In fairness to Republicans, their bill claims to have spending cuts and other measures that would offset some to the costs. For instance, they would restrict eligibility for food stamps for millionaires, and increase their Medicare premiums. That would save millions (out of billions of dollars of costs). It may be a hard pill for millionaires to swallow not being able to get food stamps, but it beats a tax increase.
The bill also raises or saves money by:
- selling broadband spectrum.
- putting fees on Freddie Mac and Fannie Mae (they need Newt)
- prohibiting illegal aliens from receiving tax credits
- freezing the pay for Federal workers, except Congressmen
- making drastic cuts in retirement funds for Federal workers, except Congressmen
- cutting other government health programs
The winners in this GOP Christmas gift are millionaires and billionaires, oil companies, Grover Norquist, and modern day prohibitionists. The losers are the American people particularly the 150 million middle class families who will see their taxes go up January 1.
The biggest winners are GOP politicians who can blame Obama for the tax cut they could have given those 150 million families.
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