Conrad Wants $2 Trillion
Senate Democrats see Obama's taxes and raise. That's a lot of 'peas.'
President Obama demanded again yesterday that Republicans raise taxes in return for giving him the debt-limit increase he's also demanding. Nice of him to be so accommodating. He has in mind, oh, something in the neighborhood of $1 trillion. But it turns out he's a piker compared to Senate Democrats, whose budget leader has announced that his tax target is $2 trillion.
Mr. Obama said yesterday it's time to "eat our peas," and $2 trillion is a lot of peas.
Senate Budget Chairman Kent Conrad emerged from his months at an undisclosed fiscal location yesterday to denounce Republicans, the rich, corporations, George W. Bush and anyone else he could blame for the ugly reality of a $1.4 trillion deficit 30 months into a Democratic Presidency and two years into an alleged economic recovery.
He didn't release an actual budget outline, as he is obliged to do under the law but which he hasn't done in two years. Instead he trickled out enough details to assess his rough priorities. Of the $4 trillion in alleged deficit reduction over 10 years, about half would be from tax increases, mostly on what he called "abusive tax shelters and tax havens" and families "sufficiently fortunate to be earning a million dollars a year."Hmmm. In 2008 about 320,000 Americans reported income of more than $1 million, or about 0.3% of all income tax returns. They paid about $250 billion in taxes that year. Mr. Conrad is going to get nearly $2 trillion more from them without damaging the economy? That should be some trick.
Mr. Conrad wants to eliminate the Bush tax rates for anyone making more than $500,000 a year, $1 million for couples. That would take the top income tax rate to roughly 41% including the phase-out of deductions. But the North Dakota Democrat also laments that a disproportionate revenue loss from "loopholes, exclusions, deductions, and tax preferences" go to the richest 1%. He wants to get rid of those too.
When most people think of tax reform, they think of trading lower rates for fewer carve-outs. Mr. Conrad is demanding higher tax rates in exchange for fewer deductions. What a deal.
The supposed dollar-for-dollar trade-off between spending cuts and tax increases is also dubious. The Conrad budget is based off what he has called "a plausible baseline," which assumes the expiration of the 2003 tax rates at the end of 2012 as now scheduled. This would mean, says ranking budget Republican Jeff Sessions, closer to a $2.8 trillion tax increase, not $2 trillion. We can't say for sure, because Mr. Conrad won't show the public his numbers.
As for the $2 trillion in spending cuts, the Washington Post reports that $900 billion would come from the defense budget. About $350 billion would come from domestic programs, which is less than half of the Obama stimulus. The grand savings from Medicare, Medicaid and Social Security—the three horsemen of the debt apocalypse—are about $80 billion. These three programs are going to nearly double in size over the next decade and cost about $20 trillion. And Democrats can only trim less than 0.5%?
Democrats have had a field day assailing Paul Ryan's House GOP budget. But even with yesterday's sketchy outline on the Senate floor, Democrats still haven't laid out any specific plan to cut spending, much less reduce the debt. What we get instead are vague promises that spending cuts are on the table, along with the certainty of higher taxes.
We doubt Mr. Conrad's plan will even make it to the Senate floor, because Democrats running for re-election are terrified they'd have to vote for it. But if their plan is so desirable, if it's time to eat our peas, why not eat them in public and on the record? Readers know the answer to that one.http://online.wsj.com/article/SB10001424052702303678704576440210871390794.html?mod=WSJ_Opinion_LEADTop#articleTabs%3DarticleFunny how the party that can't even muster up the roundtable support to pass a budget because they know the public will reject it like nothing they've ever seen before is now all of a sudden the party of "fiscal responsibility". The trillions added to the debt in the last two years alone show that the Dems really know how to handle a checkbook.
Go ahead and cave GOP. This has all been done before. Promises of spending cuts that are reneged on the second the money hits the checking accounts.
Why not put it out in the public is right. Why? Because politicians are PUSSIES.
