Thursday, November 13, 2014

GOP Jobs Bill for 2015: Tax Cuts for the Rich

The GOP knows very well that the unemployed aren’t just lazy slackers who want to be on the government dole. From Glenn Beck’s website, The Blaze:

[Republicans] noted that the labor force participation rate is still near historic lows, a sign that the unemployment rate has fallen largely because millions of people have stopped looking for work.

Republican National Committee Chairman Reince Priebus: “Under Democrat policies, millions have become so discouraged they have given up looking for work altogether; we too easily forget about them because they are not represented in the headline unemployment number.”

Boehner and soon-to-be Senate Majority Leader Mitch McConnell (R-Ky.) said they want the GOP Congress to focus on jobs when Republicans take over the Senate. That means repealing and whittling away at Obamacare, reducing the national debt, pursuing tax reform* and working on trade agreements.

* "Tax reform" is code for cutting corporate taxes for big and profitable multinational corporations and cutting the capital gains tax rate for billionaires — saying this will create jobs, even though the stock markets and profits are already at record highs — but yet, they're still not hiring people or raising wages.

And speaking of wages — Did Fox News' Bill O'Reilly just switch parties and become a Democrat? Fox News (November 8, 2014) Bill O'Reilly:

Did you know that about 70 percent of all American workers earn less than $50,000 a year? Did you know that? I didn't know that. That means the folks are struggling. They are living in a very insecure way. They have little savings and if they get sick it's a disaster. Educating their children? A huge financial burden. As is saving for retirement. So priority number one is to stimulate the economy so that workers make more money. President Obama is clueless when it comes to that ... In fact the Democrats lost this week because take home pay has gone down on President Obama's watch. That's what the election was all about ... Raise the minimum wage. That will encourage young people to get into the market place and other folks to get off the dole; $10 an hour is not going to break anyone.

Bill O'Reilly also said, "It would be a bad idea to try to repeal Obamacare ... Remember there are some good things about Obamacare, like insurance companies can't throw you off the policy if you get sick.“

But, besides raising the minimum wage and not repealing Obamacare, Bill O’Reilly also suggests:

  • have a six month tax amnesty on corporate money being held overseas
  • secure the [southern] border with a military presence and high-tech fence (but doesn't suggest a way to pay for it)
  • lower corporate income tax to about 20 percent

The GOP says these corporations pays too much in corporate taxes. Here's a recent article at Al Jazeera about subsidies for corporations and a proposed new (but weak) rule by the Government Accounting Standards Board (posted by David Cay Johnston):

Just how many billions of tax dollars corporations escape paying is a mystery. The reason: Everyone responsible for picking your pocket — the politicians who grant the subsidies, the companies that get them and the brokers who charge fees to arrange them — prefer to hide in the dark. Every dollar of tax not collected from these companies is a dollar you must make up through higher taxes, fewer government services or more government debt.

And from another post: What is a Corporate "Cash Box"?

The concept is pretty simple: it’s a company within a multinational group located in a low-tax jurisdiction that owns some sort of valuable asset. That company may not even have any employees, but since it owns the asset it is legally entitled to the profits that are generated by the asset, thereby ensuring that a portion of the multinational group’s income gets taxed at a very low tax rate.

More Corporate Taxcapades:

Google cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda. Google’s income shifting -- involving strategies known to lawyers as the “Double Irish” and the “Dutch Sandwich” -- helped reduce its overseas tax rate to 2.4 percent.

And these companies use "stock buybacks" and "tax inversions" and other tax strategies to legally avoid paying taxes. But the Republicans say taxing them even less will grow the economy, create jobs and give everybody a raise. The GOP has been saying this for more than 30 years (trickle down) — and we're still waiting.

I sincerely hope the GOP gets everything the Republican voters just voted for. And then maybe, just maybe, Obama and the Democrats won't look so bad after all.


  1. Why the Great Recession was even worse than you thought

    Potential Output and Recessions: Are We Fooling Ourselves?

  2. With a 59.2% adult employment-to-population ratio, we have no business having a 5.8% unemployment rate: no business at all:

    The Federal Government Now Employs the Fewest People Since 1966

  3. Economic Policy Institute:

    "A number of postmortems about the [2014] election have focused on the issue of wage stagnation—the fact that wages for the bottom 70 percent of the American workforce have essentially seen no increase at all since 1979. Worse, without the full-employment period of the late 1990s that pushed up wages across the board, wages for this group of workers would have outright fallen over the past three decades ... a serious policy effort to boost American wages would involve bringing a wage focus to every aspect of economic policy. So what are the prospects of policymakers getting serious about wages in the next two years? Not great ... So why my pessimism? Because the most cited issues on which the new Republican-led Congress and the Obama administration might strike a deal are tax reform and trade agreements."

  4. Other posts by David Cay Johnston:

    Americans’ ownership of assets shrinks

    Safety-net programs soften blow from stagnant economy

    Compensation shrinks for all income groups – except the very highest

    Walmart’s cuts to worker compensation are self-defeating

    Blame dysfunctional markets for our economic malaise

  5. Tim Duy: "In my opinion, the pessimistic focus from both the left and the right risks underestimating the degree of economic improvement."

    Singer's Elliott Says U.S. Growth Optimism Unwarranted as Data ‘Cooked’

    Doubting the Economic Data? Consider the Source

  6. Heritage Foundation Makes Shocking Admission!

    It seems the unemployed aren't lazy after all! The Heritage Foundation just admitted that extended unemployment benefits doesn't cause unemployment.

    From the Wall Street Journal: "What’s Causing the Increase in Long-Term Unemployment?" (by the senior policy analyst in macroeconomics at the Heritage Foundation)

    "Some economic indicators, including the short-term unemployment rate, have recovered to levels associated with “normal times.” But long-term unemployment remains high ... The persistence of long-run unemployment in 2014 is something of a surprise. Many economists, myself included, expected that the expiration of long-term unemployment benefits at the end of 2013 would sharply lower the long-term unemployment rate ... The extension of unemployment benefits does not appear to be the answer. Nor is it merely a holdover from the Great Recession: Few of the long-term unemployed report being out of work for more than two years. The majority are still in their first year of joblessness. [I question that last assertion as most are just not counted anymore and are no longer in the labor force.]



    New York Times: Unsteady Incomes Keep Millions of Workers Behind on Bills