Sunday, June 29, 2014


Paul Krugman, writing in the New York Times, notes the Republican song of the great disastrous failure of Obamacare turns out to be wrong. In fact, by most measures, Obamacare has worked quite well, much like the system it was based on, the system Governor Romney signed into law in Massachusetts. Fears that individual premiums would skyrocket have not come true. Nor have fears that only the desperately ill and the very old would sign up for it--young people have signed up in substantial numbers so the "payer mix" has proven to be quite profitable for the insurance companies it was meant to enrich.

The Republicans, of course, cling to the belief if you say something often enough, it will become accepted as received wisdom, and they may be right about that, but they are wrong about Obamacare.

Another Republican article of faith is that cutting taxes will increase employment. The story goes like this: Take money away from the government and give it back to "small businesses" and those entrepreneurs will use it to hire new employees, who will then pay more taxes and everybody lives happily ever after. 

But as Josh Barro points out in today's New York Times, "Yes, if You Cut Taxes, You Get Less Tax Revenue,"  the Republican canard that cutting taxes increases job growth and ultimately fattens tax collections,  has been put to the test in the state of Kansas and has been discovered to be, you guessed it, dead wrong.   

What happened in Kansas is tax revenues, projected to bring in $651 million arrived at $369 million. It turns out, when you cut income taxes for "businessmen" most of them do not hire more workers. Some of this happens because a "businessman" may be nothing more than a contractor, who has been hired by a company trying to avoid having to pay him benefits, and because they issue him a 1099 instead of a W-2, he gets to avoid paying income tax on that income, but he does not hire anybody. He just gets the tax break. 

Most of the "small businesses" which Kansas stopped collecting taxes from actually did not generate new jobs, and in fact the main beneficiaries of the cut in income taxes were wealthy businessmen who simply used Kansas without giving anything back.

Of course, no Republican will ever agree these numbers. Paul Krugman may be an economist who analyzes numbers for a living, but no Republican will accept anything he says because he is so clearly a Democrat, and so cannot possibly know or speak the truth. And Josh Barro writes for the New York Times, so he cannot be believed. When he quotes Governor Sam Brownback of Kansas, a Republican, saying the cut in income taxes will "create tens of thousands of jobs" and when Barro points out since the income tax cut was signed into law in 2012 Kansas job creation has been in the pits, the Republicans will simply close there eyes and shake their heads and raise their chins and chant, "No, no, no!"  

Carl Rove, on election night, faced with the numbers coming in from all the key precincts did the same thing: He denied what the numbers were saying, until one of the news broadcasters literally walked him through the rooms and screens which showed Mr. Obama being re elected quite comfortably.  But Rove looked at the numbers and said, "No, this cannot be happening." As the lady told him: Your not wanting this to be true, does not make it untrue."

And that's what's the matter with Kansas, with the Republican Tea Party and the Congress they control. Heaven help us when they get the Senate as well.

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