Paul Krugman Gives Us Ten Republican Lies on Taxes

by teacherken –

Modern conservatives have been lying about taxes pretty much from the beginning of their movement. Made-up sob stories about family farms broken up to pay inheritance taxes, magical claims about self-financing tax cuts, and so on go all the way back to the 1970s. But the selling of tax cuts under Trump has taken things to a whole new level, both in terms of the brazenness of the lies and their sheer number. Both the depth and the breadth of the dishonesty make it hard even for those of us who do this for a living to keep track.

In fact, when I set out to make a list of the bigger lies, I thought there would be six or seven, and was surprised to come up with ten.

That is how Krugman begins his New York Times blog for today (which is featured on the Opinion page of the Times website), appropriately titled Lies, Lies, Lies, Lies, Lies, Lies, Lies, Lies, Lies, Lies.

Because it is so detailed, you really should do more than read excerpts.

Here is a list of all ten of the lies repeated ad infinitum and ad absurbdum by Republican after Republican.  After I list all ten, I will provide a bit of what the Nobel Economics Laureate has to say about a couple.

 

Here we go:

Lie #1: America is the most highly-taxed country in the world

Lie #2: The estate tax is destroying farmers and truckers

Lie #3: Taxation of pass-through entities is a burden on small business

Lie #4: Cutting profits taxes really benefits workers

Lie #5: Repatriating overseas profits will create jobs

Lie #6: This is not a tax cut for the rich

Lie #7: It’s a big tax cut for the middle class

Lie #8: It won’t increase the deficit

Lie #9: Cutting taxes will jump-start rapid growth

Lie #10: Tax cuts will pay for themselves

That list by itself should be devastating.  Krugman backs each up in detail, citing historical examples, analyses by others providing charts.

For example, on Lie #1, he uses OECD data which shows that at 26.4% of GDP the US taxes are the fifth lowest, compared to an average 34.3 and a high (Denmark) of over 45%.

On Lie #2, he points out that only 50 small farms or business would on average face the inheritance tax annually, given that it now starts at $11 million.

On Lie #3, he cites the one time we have tried that maneuver, under G W Bush, with the 2004 Homeland Investment Act, where the actual results were that almost every dollar thereby repatriated was passed through as profits to shareholders, not as increases to workers.  Besides,

Those overseas accounts are just an accounting device, which have very little real effect. Many of the companies with big overseas hoards also have plenty of idle cash at home; what’s holding them back is a lack of perceived opportunities, not cash flow. And even those who don’t have surplus cash can easily borrow at near-record low-interest rates; remember, they can always use the overseas cash to secure their loans.

By now you get the picture.

This column/blog post is a definite keeper, one which should be repeatedly distributed to those who might be tempted to believe the Republican lies, that is, if such people are still willing to listen to reason.

So let me close as does Krugman, with what he says about the final lie, that tax cuts pay for themselves:

If tax cuts don’t generate an economic miracle, it’s hard for them to generate a revenue surge that makes up for lower rates. True, some hidden money may come out of the woodwork and show up as taxable income, even if GDP doesn’t rise. But this effect hasn’t historically been anywhere big enough to offset the direct losses from lower taxes. Reagan’s tax cuts led to deficits, Clinton’s tax hike to surpluses; Jerry Brown presided over California’s fiscal revitalization, Sam Brownback over a fiscal crisis that eventually prompted the legislature to overrule him and raise taxes again.

So there we are: ten big tax-cut lies. That was pretty exhausting, actually – and as I said, I’ve probably missed a few, and/or Trump will invent some new ones. But I hope this ends up being a useful reference.

It was a useful reference for me.  In making this post I am hoping it will be for others as well.

Peace.

 

Reprinted with permission from Daily Kos