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Raising Taxes on the Rich: Not Whether But How

Bruce Bartlett held senior policy roles in the Reagan and George H.W. Bush administrations and served on the staffs of Representatives Jack Kemp and Ron Paul. He is the author of the forthcoming book “The Benefit and the Burden.”

Last week, the Senate rejected proposals by both Democrats and Republicans to pay for an extension of the 2 percent temporary payroll tax cut enacted a year ago. The Democratic plan to finance it with a 3.25 percent surtax on millionaires garnered significantly more votes than the Republican plan to cut the number of federal jobs and freeze the pay of federal workers.

This time last year Republicans were insisting that the Bush tax cuts be made permanent without paying for a penny of the cost, even though there is no evidence that they stimulated the economy.

Saying that they are now concerned about the impact of the payroll tax cut on the deficit and its lack of stimulative effect makes Republicans sound a lot like Captain Renault in “Casablanca,” when he said he was shocked to discover gambling going on as he was handed his winnings.

Republicans like to pretend that cutting spending is economically costless, even stimulative, whereas raising taxes in any way whatsoever is so economically debilitating that it dare not be contemplated. This view is complete nonsense.

http://economix.blogs.nytimes.com/2011/12/06/raising-taxes-on-the-rich-not-whether-
but-how/?scp=1&sq=raising%20taxes%20on%20the%20rich%20not%20whether%20but%20how&
st=cse

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