Tax Policy As Farce
The Opinion Journal points out the death of the Democrat's much-ballyhooed PAYGO rules in the ongoing battle to patch the Alternative Minimum Tax. They also point out that the PAYGO rules have been a farce all along. The rules were regularly flaunted by tricks that would have landed a private citizen in Federal prison for fraud.
But paygo shouldn't be allowed to expire without everyone kicking sand on its grave. That's because it has been nothing but a confidence game from the very start. Paygo doesn't apply to domestic discretionary spending, and it doesn't restrain spending increases under current law in entitlements like Medicare and Medicaid. Its main goals are to make tax cutting all but impossible, while letting Democrats pretend to favor "fiscal discipline," a la Ms. Pelosi's boast above.
In fact, the paygo farce has been unfolding all year. Since the day they took the gavel, Democrats have been using gimmick after gimmick to evade it. The Schip bill for health care, for example, includes a spending "cliff" that disguises its actual cost. It assumes spending would rise to $14 billion in 2012, but then pretends the costs would fall to less than half that level in 2013–which just so happens to fall outside the five-year budget scoring window. Some $60 billion in spending over the next 10 years were hidden through this ploy.
Then there is the House farm bill awaiting action in the Senate. That spending marathon includes between $5 billion and $10 billion in fictitious paygo savings by shifting the date of farm aid payments from one year to another. If a Fortune 500 CEO did that sort of thing, he'd be indicted.
House Democrats realize how humiliating this all is, so they're still vowing to make paygo work. Especially embarrassed are the so-called Blue Dog Democrats for whom "fiscal discipline" is a coat of political protection. John Tanner of Tennessee is so upset he says the Senate paygo abdication "is bordering on criminal," and about 30 Blue Dogs are threatening to vote against AMT repeal without offsetting tax increases. They'd have more credibility if they also opposed the various fiscal gimmicks in the Schip and farm bills, not to mention the 2008 Congressional budget outline that exceeded President Bush's budget request by $22 billion.
The Democrats have already signaled that gargantuan tax increases will be passed as soon as they have enough votes and they have been socking Americans with hidden taxes on a regular basis since they took control. The energy bill is going to cost Americans billions upon billions in additional energy costs, in fact the cost of virtually everything is going to jump sharply if it becomes law. And there are still more tax hikes being floated on a regular basis.
As the editorial points out, the AMT PAYGO "offsets" were sunk directly because the people who would have been hit by it - hedge fund managers - paid huge sums of money to Democratic lawmakers. They call it "lobbying" and "campaign funding".
What does it smell like to you?
By FedUp, Monday, 10 December , 2007 @ 2:57 pm
EEEWWWWWWW!