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Tilting at Windmills

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July 13, 2010

JON KYL DOUBLES DOWN.... Over the weekend, Senate Minority Whip Jon Kyl (R-Ariz.) was asked on Fox News how he'd pay for extending the Bush tax cuts for the wealthy, at a cost of $678 billion. After initially dodging the question, Kyl said what he really believed: "You do need to offset the cost of increased spending, and that's what Republicans object to. But you should never have to offset cost of a deliberate decision to reduce tax rates on Americans."

It was a classic concession. For all the talk about how desperate Republicans are to lower the deficit, Kyl stated what is clearly true: the GOP doesn't even want to try to pay for tax cuts. This, of course, from the party that won't even allow a vote on extended unemployment benefits because of alleged deficit concerns -- and from the party that made the deficit so high in the first place.

Brian Beutler caught up with Kyl yesterday to explore this in more detail.

[Kyl] claimed candidly that the very existence of unemployment insurance is a "necessary evil," while tax cuts ought not be paid for by increases in order to make it easier to shrink the size of government.

"My view, and I think most of the people in my party don't believe that you should ever have to offset a tax cut," said Senate Minority Whip Jon Kyl. "That clearly reduced savings is a better way to offset increased spending than a tax increase is."

The rationale, Kyl said, goes back to the ultimate conservative goal of shrinking the size of government. If tax cuts are offset by tax increases in other area, then the government can only grow.

When reminded of overwhelming evidence that unemployment benefits are a very effective stimulus, Kyl said he didn't care about the economic studies. Aid for the jobless, he said, is "a necessary evil" that's "a bad thing for the economy" when the costs are added to the deficit.

There are a few angles to consider here. The first is that anyone who thinks $30 billion added to the deficit is "a bad thing for the economy," but $678 billion in tax cuts added to the deficit is fine, shouldn't be taken seriously.

Second, Kyl's argument is effectively a philosophical one -- government is bad, tax cuts shrink government, ergo tax cuts must be good under any and all circumstances. There's no intellectual integrity to any of this, but it's nevertheless the driving force behind the Republican approach to governing.

Third, unemployment benefits aren't a "necessary evil." As Annie Lowrey explained, "Unemployment insurance ... is a federal insurance program, which helps guarantee that working Americans maintain a decent quality of life for themselves and their families during spells of joblessness. Virtually all Republicans support having an unemployment insurance system." Well, at least they used to.

Finally, I think there's an easy way to consider the bigger picture here. The question for policymakers from both parties is almost always the same: can we afford it? Kyl sees $30 billion in benefits for the unemployed and says, "No, we can't afford it." He sees $678 billion in tax cuts for the wealthy and says, "Yes, we can afford it."

It's roughly the equivalent of a family going into Costco, and a parent insisting that they don't have the money for produce, but they do have the money for the giant, flat-screen television.

Kyl not only thinks this makes perfect sense, he expects voters to reward his political party for thinking this way. And if the polls are any indication, Kyl may very well be right.

Steve Benen 8:35 AM Permalink | Trackbacks | Comments (40)

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Comments

It's roughly the equivalent of a family going into Costco, and a parent insisting that they don't have the money for produce, but they do have the money for the giant, flat-screen television.

There are probably millions of amuricun families who have done exactly that, and they all vote for republicans. At least the party represents its constiuency.

Posted by: cr on July 13, 2010 at 8:38 AM | PERMALINK

Clowns with microphones - the very definition of Republicans serving in government!

Kyl represents the worst in our American heritage - he condemns others for inspiring class conflict, yet it is apparent he is dead serious about protecting wealth in this nation while denying policy that reflects the economic, social and political realities facing the American middle class!

Kyl needs to be unseated as with all the buffoons who run to get elected to redistribute wealth to their rich constituents while obstructing funding and policy, aiding to the destruction of any attempt at good government!

Let's say it loud and clear, over and over again - Kyl and the Republicans want to make the middle class subservient to their views of who should be privileged in our society, and who will have to eat shit! -Kevo

Posted by: kevo on July 13, 2010 at 8:43 AM | PERMALINK

A noun, a verb, and a tax cut.

Posted by: jon on July 13, 2010 at 8:47 AM | PERMALINK

How long do we have to give up fresh vegetables to have a giant TV, Dad? If it's the only way to get one, what % of American families wouldn't be willing to sacrifice produce for a year or two?

Posted by: Michael7843853 on July 13, 2010 at 8:49 AM | PERMALINK

So why don't the Democrats show that and say, "So the Republicans think $30B in insurance for the unemployed is way too much, and $600B more for the rich is way too little. This is the way the Republican leadership sees the economy. Is this a party to lead all of us? No!"

That is, it's pretty clear the MSM won't ask the hard question of "Well, what does this mean?" so the Dem commercials should. In every contested district!

And "Privatizing or even eliminating social security and Medicare. These views are held by so many Republican candidates. Ask them. Check their previous statements and confront them. Do we really want senior citizens to starve? That's what they wanted in 1960, and that's what the Republicans want now. We decided no to that 50 years ago. Let's not turn back the clock to destitution for our elderly by voting Republican.

Posted by: alix on July 13, 2010 at 8:50 AM | PERMALINK

I am personally shocked that that lying sack of shit would support the millionaires relief fund . I tried to watch the video and it bordered on incoherent. This country is F**ked . We only pay enough in taxes to cover a portion of the entitlement programs with the rest for those fun Wars and stuff borrowed from China . Hell in a handbasket. Glad I'm old and I hope the economy stays intact until I croak.

Posted by: John R on July 13, 2010 at 8:51 AM | PERMALINK

Every day we see conservatives saying things that are so alien and asinine that I can hardly believe that so many Americans support them.

Especially in the current economy, that they maintain and even grow support after saying what they say and doing what they do, day in and day out, is there any hope for rationality and fact-based decision-making?

Given the state of media and the penchant to be willfully misinformed - and to dig in heels even when facts are counter to beliefs, I find myself becoming more and more pessimistic about the future of this country.

Posted by: terraformer on July 13, 2010 at 9:04 AM | PERMALINK

Shorter Kyl:

Tax increases need to be paid for with service reductions, while tax cuts should result in service reductions.

Posted by: Perspecticus on July 13, 2010 at 9:07 AM | PERMALINK

Does this count as a reversal? At first he said tax cuts don't need to be offset; now he says spending cuts would offset tax cuts. He doesn't say which spending cuts, naturally.

Is there confusion about what "offset" means? Did Kyl understand the question to mean, "What taxes would you increase to afford a tax cut?"

Posted by: Grumpy on July 13, 2010 at 9:08 AM | PERMALINK

"It's roughly the equivalent of a family going into Costco, and a parent insisting that they don't have the money for produce, but they do have the money for the giant, flat-screen television."

Actually, considering how the Republican tax cuts are skewed, it's more like a middle-class parent going into Costco and being told they can't buy produce, but they have to buy a giant flat-screen television for the wealthy family next door.

Posted by: gradysu on July 13, 2010 at 9:09 AM | PERMALINK

Kyl must have forgotten the term "Laffer Curve". After a while Republicans all forget the logic of their argument and only remember the talking points. What happened to Kyl was that he forgot the talking point.

Posted by: Danp on July 13, 2010 at 9:11 AM | PERMALINK

Right now our taxes pay for Social Security, Medicare and Medicaid. Every other Federal program is put on the American credit card. We need to reduce our income further? Right.

At least in the old days they tried to convince themselves that tax cuts would magically increase revenues. That didn't happen during Bush's watch. it hasn't happened in this recession. It won't happen in the future.

Posted by: Ron Byers on July 13, 2010 at 9:14 AM | PERMALINK

Kyl’s argument is breathtaking in it’s vast stupidity and avarice. Even more appalling are the people, many who aren’t wealthy, who lap this up like mother’s milk. The Republicans continue to provide ammunition for a large part of the populace to shoot themselves in the foot. While they’re occupied hoping around on an injured foot, the Republicans loot and pillage with abandon.

Posted by: Diane Rodriguez on July 13, 2010 at 9:15 AM | PERMALINK

Honest question - not trolling

Why is there "no intellectual integrity to" the argument that "government is bad, tax cuts shrink government, ergo tax cuts must be good under any and all circumstances"?

I disagree with that idea, and can think of many circumstances in which I think tax increases are better than tax cuts, but it seems like a valid logical chain.

Posted by: Ben on July 13, 2010 at 9:15 AM | PERMALINK

Why is there "no intellectual integrity to" the argument that "government is bad

Because the people making the argument are 1) in government or lobbying it 2) claiming to make it better 3) Not cutting costs - in fact, the only cost cutting they really want is regulation. 4) Not cutting the size of government by cutting taxes, but rather increasing government, but merely paying for it by creating more debt.

Posted by: Danp on July 13, 2010 at 9:23 AM | PERMALINK

@Ben

Off the top of my head... the argument is coming from someone living off the largesse of the government that they say is bad.

Posted by: cr on July 13, 2010 at 9:25 AM | PERMALINK

Ben, the other reason there is no intellectual integrity to the argument that tax custs shrink government is that, when Republicans were in complete control of the federal government, they expanded its size and scope. Kyl is simply choosing to ignore his own place in history.

Posted by: Lifelong Dem on July 13, 2010 at 9:27 AM | PERMALINK

However, just think of all of the fine documentaries one can watch on growing produce, if you have a 64 Inch HD LCD?

Kyl is consistent with the conservative useage of politics as an end goal, rather than that of the liberals who continue to believe that politics is only a means.

Yesterday, at theygaveusarepublic.com, Ted Frier presented an essay by Professor Alan Wolfe, who critiqued the writing of Carl Schmitt, the German political philosopher, devout Catholic, who joined the NSDAP in '33. Schmitt outlined the differences between conservatives and liberals in his "In the Concept of the Political". Highly recommended reading if any liberal wants to understand the mindset of the conservatives. Feel free to drop by theygaveusarepublic anytime to read the fine work of Ted Frier, BlueGirl, Yellow Dog and several other fine progressives. Comment at your leisure.

Posted by: berttheclock on July 13, 2010 at 9:30 AM | PERMALINK

When Kyle tried to defend himself Sunday, he kept insisting that the tax cuts were not just for the rich, he insisted that the roll back of the tax cuts would affect everyone.
This is how the Republican party gets away with this crap - they give beer and lip service to the middle class while robbing them blind.

Posted by: msw on July 13, 2010 at 9:32 AM | PERMALINK

Thanks! I think that Lifelong Dem's argument is the strongest one against voting Republican for those people who happen to think the idea that "government is bad!" is a good position (which I don't).

Posted by: Ben on July 13, 2010 at 9:34 AM | PERMALINK

Between Kyl and McCain, I'm thinking that a couple hundred thousand uneducated, illegal immigrants would raise the collective IQ of the rest of Arizona's voters.

Posted by: FitterDon on July 13, 2010 at 9:36 AM | PERMALINK

John Kyl needs to lose his job.

Posted by: MLJohnston on July 13, 2010 at 9:39 AM | PERMALINK

And if the polls are any indication, Kyl may very well be right.

"Democracy is the theory that the common people know what they want, and deserve to get it -- good and hard." H.L. Mencken

Posted by: Davis X. Machina on July 13, 2010 at 9:43 AM | PERMALINK

can I haz flatscreen?

Posted by: Scott F. on July 13, 2010 at 10:00 AM | PERMALINK

If the American people are stupid enough to put the Repubs back in charge, then they deserve to get it good and hard. Thank you, Davis.

Posted by: Jim B on July 13, 2010 at 10:00 AM | PERMALINK

Question on the math here: When making the comparison, shouldn't we be saying $67.8 billion (1 year of tax cut extension) versus $30 billion (one-off extension and payment for unemployment benefits)?

And why would the tax cut extension be for 10 years instead of 1 or 5?

Posted by: Kiweagle on July 13, 2010 at 10:08 AM | PERMALINK

Don't forget that Kyl voted for the Medicare prescription drugs bill in 2003, which has cost some $50 billion a year since it went into effect, so his "government-shrinking" bona fides are especially suspect.

Posted by: Patience on July 13, 2010 at 10:21 AM | PERMALINK

To build on Kiweagle's post, put together a bill with a 2 year shelf life that ensures 2 year's worth of the Shrub tax cut ($136b) remains in place. Because you just KNOW the Rethubs will claim letting the cut lapse will be called Obama's tax increase. Except retarget the recipient's of this cut as those with income less than $250k/year keeping in place Obama's promise to protect that group. Then call for a $300b cut in the defense budget to pay for unemployment extension benefits until we climb out of this hole. ALL of this money will target the group we know will spend it and help create demand for consumer goods.

Posted by: Chopin on July 13, 2010 at 10:25 AM | PERMALINK

Cutting taxes on the wealthy investor class results in more investment, more economic activity, more jobs, and ultimately more tax revenues. A zero tax rate will result in infinite tax revenues.

Just filling in for Al.

Posted by: emjayay on July 13, 2010 at 10:32 AM | PERMALINK

Bruce Willis is a right winger, they can have him!

Posted by: Ted76 on July 13, 2010 at 10:41 AM | PERMALINK

hey, if they want to shrink the government so bad, why not get rid of the senate?

Posted by: MLO on July 13, 2010 at 11:16 AM | PERMALINK

As a 50+ year resident of AZ, I can tell you that one of the problems that we Dems have in fielding candidates to run against McCain and Kyl is name recognition. We keep running people against them who are not well-known throughout the state. We need to seriously work on building a larger stable of candidates with name recognition.

I would love to see Napolitano run against Kyl in '12, for instance. A girl can dream...

And seconding Emjayay. Kyl either believes in the Laffer Curve, or pretends to believe in it because he resents paying ANY taxes, especially for THOSE people.

Posted by: Wolfdaughter on July 13, 2010 at 12:04 PM | PERMALINK

Money In (Taxes)
-Money Out (Spending)
=Deficit

The “Money In(Taxes)” can be grown in more ways than one. You appear to support raising taxes, which tends to retard the actual growth of the United States economy by providing a disincentive for work. Work harder so the Federal Government can take more of my money and spend it where it is most under-utilized? No thanks.

Simply adding to the unemployment fund and giving more money to the unemployed is a guise for compassion. Not only does it barely provide even a trivial short-term influx to the economy but it also creates a disincentive for the unemployed to truly contribute by getting a job. Ironically the unemployment fund prolongs the state of unemployment.

A relevant comparison would be the philosophy of a higher taxes paired with a state income tax, which seems to only contribute to the troubles of states such as California and New York. On the other hand, states such as Texas and Florida (no state income tax) seem to have an easier time controlling their deficits.

Another relevant comparison--What would be better for the American economy?: Raise the corporate tax rate and send businesses overseas where they wisely and legally avoid taxes. OR Lower the corporate tax rate and provide incentives for businesses to create jobs. The happier the American people are, the healthier the American businesses are. The healthier American businesses are, the more jobs are created.

Cutting taxes for the American people and their businesses creates jobs, which equals more people paying taxes. This leads to a higher amount of money being delivered into our “Money In” variable of the original equation. If A=B and B=C, then A=C. A=cutting taxes which is an incentive for job growth, B=more working people capable of paying taxes, C=more money “in” to reduce the deficit.

My point is this--Two people paying taxes are more beneficial than raising taxes on one while the other receives unemployment benefits. That’s simple math.

I’m sure you’ll attempt to trump this methodology with the allegation that the greedy rich people don’t reinvest there tax cuts into their businesses hence, there are no jobs being created. I don’t expect you to understand how to operate and grow a business (that’s evident from your ratings). Unfortunately for you, raising taxes and giving that money to the unemployed doesn’t create jobs and it doesn’t reduce the deficit. Especially when our Federal Government has always been known to spend money the way they do. Inefficiently.

Posted by: Eddie on July 13, 2010 at 12:05 PM | PERMALINK

Eddie
So Eddie can't read but he sure can parrot .

Posted by: FRP on July 13, 2010 at 1:43 PM | PERMALINK

Eddie, here's how bad the mathematics fail is on supply side tax cutting. Assuming that the money from the tax cut was reinvested, and the total results retaxed at the same rate, you would need a growth margin of at least 250% to recover the money cut from the original tax bill.

This is assuming 1% reduction in tax from 40%. It gets worse the more of a cut you get. Reducing 40% to 20% would require a 500% return on investment to generate an equal amount of tax to the amount given in the cut.

I'm sure you can explain how *all* the new jobs created will raise 200% revenues!

Posted by: royalblue_tom on July 13, 2010 at 1:49 PM | PERMALINK

40%? That's ^$370K a year. Of course there is a serious reaction even in a %1 change in tax rate, your talking about the rich (once again). Raising taxes is going to do nothing but convince the Federal Government that they can spend more and more. Heck it even happened during the Reagan Administration when he signed tax CUTS into law. It doubled total tax revenues in the 80's (500B>1T) but soon after, the deficit tripled because of spending. It's going to take fiscal responsibility as well. No dur right?

I just happen to believe that the best way to stimulate the economy doesn't have anything to do with tax increases. Jobs, jobs, jobs. Democrats, Republicans, Liberals, & Conservatives all know this. You don't get jobs when you raise taxes.

Provide individuals and businesses (including corporations) with an incentive to grow and invest. This creates jobs. The people who were unemployed (not paying taxes), now enter into the job market (and are now pay taxes).

Raise taxes on the "rich" who pay 95% of the taxes in the first place causes the entire system to wince. You'll get your money but you also tend to bite the hand that feeds you. (ironically so in the unemployed persons case) If you want to discourage something, you raise taxes on it. Income, Cigarettes, Investments, ect.

Kuh Kahhh--Parrot

Posted by: Eddie on July 13, 2010 at 3:21 PM | PERMALINK

But, Steve, if you get a really nice high-def television, you'll be able to practically taste the produce that you see on it! And isn't appearance over substance more important anyhow?

The rationale, Kyl said, goes back to the ultimate conservative goal of shrinking the size of government.

Until something like the Deepwater Horizon disaster happens, and then conservatives are screaming "Why isn't the government taking over and fixing the leak?! The government needs to step up and wrest control from the private corporation that caused the problem to begin with!"

Posted by: josef on July 13, 2010 at 4:33 PM | PERMALINK

Jon Kyl is an idiot. As one of his constituents, I wrote him a letter a few years ago concerning the rapidly increasing cost of gasoline at the pumps while big oil was reporting windfall profits. He responded with a form letter explaining how when supply was short the cost of the commodity went up in price.

This told me he: a) didn't read my letter, or b) doesn't understand how profits are figured. I strongly suspect it was b.

Posted by: haddie nuff on July 13, 2010 at 4:36 PM | PERMALINK

Eddie,

You don't get jobs if you don't invest money though. And private business isn't spending money to create jobs right now. So government needs to fill the void - and where do they get the money from?

You said "Cutting taxes for the American people and their businesses creates jobs, which equals more people paying taxes." But the math don't work for you - *if* the rich who own businesses reinvest all of the money I cut from taxes to create jobs, I'll only see a percentage of that coming back in taxes.

It makes more sense to just use the tax money you have to create job programs directly, guaranteeing that the money is used to stimulate companies that create jobs.

Of course, it makes even more sense to cut taxes on the lowest paid, and provide unemployment payments for those who don't have jobs - because that money does not get invested, it gets spent immediately, stimulating demand, and helping companies grow their business.

Taxes for the rich are at their lowest of all time. Putting taxes for the rich back where they were 10 or even 20 years ago is only going to cause a wince because of pure greed and entitlement.

Posted by: royalblue_tom on July 13, 2010 at 5:01 PM | PERMALINK

I live in Arizona and I asked the good Senator to investigate the cronyism at the NSA. My former husband works at the NSA, biggest cronie there could be. He broke a lot of Federal laws, and basically, I want him investigated.

I got back a 6 line letter telling me to sue the NSA. Like I have the money to go around suing the NSA. Kyl's attitude is, if you don't like the Defense Department, or any other Federal agency, then a private citizen should just clean it all up at their own expense.

Posted by: Sharon Hodges on July 15, 2010 at 9:30 PM | PERMALINK




 

 

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