EXACTLY...
And this is why Republicans who have basically leaned on the “tax cuts increase government revenue” argument are either mental, or lazy.
At the point we are at, I think we have to at least assume that we are on the left side of the curve. Hell, maybe we’re still on the right side of it, but don’t you think we should go about our budget preparation as though we were on the left of it?
Cutting taxes is not, and can not be, the end all be all of the Republican economic agenda, because the logic we use to justify them in a world of deficits is simply not enough - its only half the solution.
We have to get serious about spending cuts, entitlement reform and all the other things that will decrease the amount of spending at the federal level.
If we aren’t prepared to do that, then we can’t cut taxes. If we do and don’t balance the budget by cutting spending, then we are only passing along a defacto tax increase on our kids to pay for the insane debt we are incurring. Either way, we’re screwing ourselves with taxes, or screwing our kids with them.
Cutting taxes without cutting taxes is the cowards way out.
At this point in time, tax cuts could actually be viewed as a “bailout” to taxpayers. (Note: I said to those who actually pay taxes.)
No amount of credit being available is going to induce someone who lacks confidence in our economic future to buy a new car right now.
No $2,000 stimulus check from the gubmint is going to dislodge the shock people feel at having lost 30, 40 or 50% of the value of their retirement savings in a month or so.
But bold tax cuts that extend from now into the future could start to restore confidence.
Why not “bail out” WISE homeowners—those who make the decisions and contributions that keep this country afloat-—by tripling the mortgage interest deduction for those living in their home and current on their mortgage for the tax year?
Or how about using tax credits to “bail out” the country’s good customers. Those who saved well for retirement and lost big in this meltdown-—instead of “buying” their 401(ks), let them treat the loss as a tax loss or even better devise a tax credit to address them. Say the TP can take up to $20K qualified (TBD) 401(k) loss (determined as loss from balance on Date 1 to Date 2, or a percentage loss for 2008, for example) as a credit with carryover per year for 20 years.
Give a tax deduction or credit for consumer loan interest, including credit cards, when the TP was current on the loan for the tax year. That would reward the consumer who pays his bills and encourage spending by those most likely to continue to pay their bills.
Fund “frequent buyer” rebates for qualified retailers. Say Wal-Mart starts a program where if a consumer spends “x” dollars at Wal-Mart during the year, Wal-Mart rebates the consumer “y” amount at year-end (before Christmas), which is reimbursed to Wal-Mart from the gubmint with “economic stimulus” funds. Could be administered in several different ways, but bottom line it’s getting the stimulus money to people spending money to get the economy going. Many retailers might be interested in such a program.
There are a million ways to take $700B in “stimulus” and creatively target it to those who are proven best at spending it through tax credits and deductions.