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July 14, 2006

Confused Americans for Truth - Static Scoring is Wrong Again

by Ferdinand T Cat

Today at Human Events Online, political scientist Mike Franc discusses the effects of the 2003 tax cuts. The most important paragraph is this one.

[The Congressional Budget Office] informed lawmakers in May 2003 that the tax cuts would cost the treasury $94 billion in 2006. But it now appears that the cuts generated so much “unexpected” economic activity that the original CBO projection for 2006 was off by an astounding $124 billion! Add in last year’s underestimation of $89 billion, and the $25 billion oversight in 2004, and you have a cumulative CBO mistake that now totals $238 billion.

House Minority Leader Nancy Pelosi intends to position her party as deficit hawks for the Fall elections. It's worth examining how Pelosi's plan would work in the face of the actual results for 2003. The first step in Pelosi's plan is to prevent renewal of the Bush tax cuts. Pelosi's Democratic colleagues in the House want to split the $94 billion thus saved 50-50 between new spending and deficit reduction. In fact, the actual measured effect of the tax cut is a $30 billion revenue increase, and when you add in the $47 billion of new spending, Pelosi's fiscal restraint will increase the real deficit by $77 billion.

That's a message that needs to get out. Yes, it may be painful for many people to accept the possibility of the wealthy keeping a larger percentage of their earnings, but if that's what we have to do to rein in budget deficits and grow the economy then I pay the price gladly.

Respectfully submitted,

Ferdinand T. Cat

Trackposted to Blue Star Budgeting, Pursuing Fiscal Restraint, Cao's Tax Cuts, Right Wing Economics, Woman, Budget Thyself, Adam's Tax Cut, TMH's Spending Bits, Pirate's Revenue Projections, MacBros' Campaign Plan, Gospel Deficit Projections, Accountant Jenee: People are Idiots, Madman Proposes a Budget, Jo's Appropriations, and Basil's Compendium on the Follies of Tax-and-Spend Politics.

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Woman budget thyself?..haha


Posted by: Angel [TypeKey Profile Page] at July 14, 2006 6:32 PM

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