Who gets the credit?

Representative Paul Ryan believes the federal government should have a budget just like families have budgets. In a functional family budget, all members contribute to staying within spending limits. If Paul Ryan was serious about mutual contribution, then he should focus on eliminating tax credits for the rich corporate people. Raising income taxes on the wealthy isn’t the only answer; eliminating tax credits is another solution. From the Nation magazine:

“Oil companies with billions in quarterly profits can deduct costs for drilling wells and receive “manufacturing” tax deductions for simply refining crude oil. Norquist’s pledge (and his foundation’s advocacy) transforms billions in tax payer handouts into “tax cuts” that cannot be removed."

Further explaining Grover‘s non tax pledge“ …-the promise not to cut tax credits--is important for understanding how Norquist has become a proxy for K Street. From a budget stand point, a targeted tax credit is basically equivalent to a subsidy: the main difference between a $1 million tax credit to an ethanol refinery and a $1 million subsidy to the same ethanol refinery, for example, is that one is distributed by the IRS, the other by another federal agency. There are enough of these subsidies in the tax code that many profitable companies, like Duke Energy, can pay an effective negative tax rate.”

“GE made a contribution of $50,000 to Norquist’s foundation in 2011. Consider that for a moment: GE gave more to Norquist in 2011 than it reportedly paid the IRS for income taxes in 2010, a year the corporation made $14.2 billion in profits.”

Along with personhood comes civic responsibilities, that‘s the understanding in America. But because these obscenely wealthy corporate people know where to donate, they pay nothing in taxes, while the ordinary citizen is scrutinized.

Eliminating tax credits for the corporate people should be in the political debt debate, rather than the megaphone over the country’s “spending problem” on social causes. It isn’t just a spending problem, it’s a collection problem. A true budget includes contributions from all, not all from many and nothing from a few.

Republicans realize their goal

Douglas Holtz-Eakin, former Congressional Budget Office director was interviewed on the PBSNewsHour and said, “It’s been noted for 10 years by the CBO among others that we cannot grow our way out of this, we can't tax our way out of this. It's an entitlement spending problem that has to be brought under control.”

If this has been noted for the past ten years, then that brings us back to the Bush years when deficits resulting from tax cuts didn’t matter. The point of tax cuts was to shrink government, a decades old Republican ideology promoted throughout the sixties and seventies by economists like Milton Friedman. Reduce taxes, reduce government and let the free market reign. Doing so will being economic harmony and success for the country.

After decades of letting the “free market reign” with tax cuts and sub prime junk bonds wrecking the economy, now, the new scapegoat on the block is: it’s the “people” and their entitlement programs causing all the budget woes.

Focusing solely on cutting entitlement programs blinds them from focusing on jobs creation. So far, the only action Republicans have taken on creating jobs, has been tax cuts for the filthy rich “jobs creators” with very few protections for the workers. Has anyone given any thought to the long term damage high unemployment will bring to the future?

High unemployment is a concern for the Federal Reserve, the central Bank. Maybe the bankers, the real money people, understand high unemployment is the biggest threat to the future, not “entitlement spending”.

Banks and corporations are sitting on trillions, refusing to invest in the future, while billionaires like hedge funder Pete Peterson peddle propaganda to convince a majority that economic salvation is not through jobs, but cuts in Social Security. The real objective behind their focus on the “entitlement spending problem” is the elimination of Social Security; which has been a Republican goal since the Reagan era.