40 Bipartisan Economists Agree that Republicans Have Abandoned Economic Reality

Jul 27 2012 Published by under Featured News

It is not necessary for Representatives in Congress to be economic experts, but one hopes they have a rudimentary understanding of revenue and expenses as they relate to the business of running a government. Unfortunately, since the 2010 midterm elections when teabaggers swept into the House, there has been a dearth of basic understanding about how the economy operates and it nearly led to a credit default last summer, and positively caused S&P to downgrade America’s stellar credit rating. But that’s what happens when Republicans pledged that, regardless the cost to America and its people, they would obstruct any economic proposal from President Obama and Democrats. There has been chapter and verse written about the sad state of the 112th Congress, especially the House, with a group of mentally deficient conservative sycophants controlling the government purse, and now, a collection of forty economists have weighed in and concluded that Republicans have abandoned economic reality, and it includes the House, Senate, and Willard Romney.

A survey found that economists from both ideological and political schools of thought overwhelmingly agreed that President Obama’s stimulus reduced unemployment despite Republicans’ persistent claims it was a failure. The economists also overwhelmingly agreed that the nation must have increased revenue and that reducing the federal deficit cannot be accomplished solely with spending cuts. Most revealing though, was that virtually all the economists agreed the so-called “Laffer Curve,” the lunatic notion that cutting income tax rates actually increases tax revenue, is ridiculous as an economic policy; but then again, any semi-conscious seventh-grader would have little problem debunking such a ridiculous proposition. Unfortunately, Republicans lack the cognitive abilities of an elementary school student and their malfeasance now, and in the past, is the reason the economy is limping along with little signs of improving as long as they adhere to their current policy of austerity and increased tax cuts for the wealthy.

One needs look no further than the Paul Ryan and Willard Romney budget proposals to understand that economic reality is not the purview of Republicans. Both men make drastic cuts to government spending, especially on social safety nets, while giving massive tax cuts to the wealthiest 1% that economists agree still increases the deficit by trillions of dollars. Despite the idiocy of spending cuts for 98% of the people and increased entitlements for the rich, Republicans steadfastly support austerity that is ravaging England after conservatives took control of the government.

In the first leg of Romney’s foreign-bank fundraising tour, he is getting a first-hand look at the devastating effects on a nation’s economy when spending is drastically cut and entitlements for the wealthy are increased. The Labour Party in England is fighting to increase revenue and hold the wealthy accountable for their tax burden like Democrats have attempted for the past three years. In January, Westminster MPs called for Romney’s Cayman tax haven to be closed because “tax havens for wealthy corporations are fuelling the global economic crisis from 2009 onwards,” and they were “alarmed by reports that Romney is using the Cayman Islands to avoid paying the same tax rate as other US citizens.” The Cayman Islands are a British territory.

The MPs acknowledged that the “top 1% in the US and UK avoid paying the correct tax in their own country at a time when living standards are being squeezed and services lost for ordinary working people, and called on the government to close tax havens and increase transparency so the very richest pay their fair share of tax in their respective countries and enable governments worldwide to invest more in jobs and growth.” It is anathema to Republicans, but economists worldwide acknowledge that lost revenue from giving special tax breaks and privileges to the wealthy is causing untold damage to people and economies whether in the United States or the United Kingdom. The former head of England’s Treasury Select committee said, “it is a disgrace that the Cayman Islands, a tax haven, enables wealthy corporations and individuals such as Romney and the wealthiest 1% to avoid taxes while across the western world, hard-working people are seeing their living standards and take-home pay stagnate or reduced.” John Cryer, former Labour MP understands what Democrats and President Obama have tried unsuccessfully to accomplish in America; getting the wealthy to pay their fair share in taxes to increase revenue and invest in jobs is key to economic growth. However, that ideology is economic reality and as the forty economists noted, economic reality is alien to Republicans who cannot grasp how a government’s economy works.

Last week, 100 ignorant House Republicans told John Boehner in a letter that if they failed to repeal the Affordable Care Act, it was time to shut down the government. Apparently, they have no idea of the economic consequences of defunding the government, or the waste of money repealing the health law is costing. Republicans voted over 30 times to repeal the health law at a cost to taxpayers of over $50 million, and if they are successful their actions add $109 billion to the deficit. These are the same Republicans who nearly caused a credit default and shut down the government last year, and their opposition to a constitutionally upheld law inspires them to shut down the government again. Last year Republicans failed to pass a clean debt limit because they demanded cuts to offset the increase, but many of the same Republicans raised the debt ceiling 19 times during the Bush administration without offsets. In May 2003, Senate Republicans voted to raise the debt limit the same day they voted for $350 billion in tax cuts for the wealthy as evidence economic reality has been lost on Republicans regardless who is president.

No-one expects every legislator, or presidential candidate, to be an economic expert, but every American expects their representatives to understand how the economy works.  America has suffered a revenue problem for over ten years, and the GOP still cannot comprehend the country cannot continue to function, or grow, on budget cuts for the 98% while giving tax breaks to the rich. Republicans claim the deficit is a reason to cut spending, and yet they support Romney and Ryan’s plans that add between $4 and $5 trillion to the deficit, so either they have abandoned economic reality or the really don’t care about the deficit. Throughout the Bush years, the Republican refrain was “deficits don’t matter,” and they borrowed for two unnecessary wars, tax cuts for the rich, and a Medicare prescription plan that Americans will be repaying for a generation.

Most intelligent beings seek out expertise when they are out of their depth regardless the issue, and for three years economic experts have warned that America has a revenue problem, not a spending problem. President Obama’s spending is drastically lower than Reagan, Bush I, Clinton, and Bush II and yet the GOP demands more as they balk at revenue increases. It is reasonable that after 12 years of declining revenue, even economically challenged Republicans could comprehend that spending cuts do not increase revenue, and that their austerity agenda is being played out with disastrous results in England right before their eyes. The 40 economic experts were correct that Republicans have abandoned economic reality and it is unfortunate that their fantasy of no new revenue will be the economic undoing of this country.

Image: mariopiperni

Comments are off for this post