Posted by Bob Lord
If you're sick and tired of partisan bickering in Congress, you may want to reconsider.
You see, one month ago, the "freshman bi-partisan caucus," or "United Solutions" gang, as they're calling themselves, led by 29 year-old Democrat Patrick Murphy of Florida, issued their manifesto, in the form of a statement to President Obama and House leaders in both parties, outlining their supposed bi-partisan solutions. You can find the entire letter here. According to this bi-partisan caucus, which by my count numbers 36 including 13 Democrats, their statement outlines areas of "common ground." My own assessment is that the supposedly common ground bullet points in the statement either are taken straight from the Republican playbook or are proposals with which nobody could conceivably take issue, like "aggressively pursuing Medicare fraud." Wow, that's thinking outside the box.
But the real gem in the United Solutions manifesto is the second bullet point, which reads in full:
Promote economic growth to generate revenue – Of critical importance is a fair and broad tax plan including eliminating excessive corporate subsidies, tax loopholes and other subsidies to provide lower rates, that will encourage a pro-growth economy, providing added revenue for the federal budget. We must also encourage innovation with less stringent regulation to help small businesses grow, which will lower unemployment.
How clever! A bi-partisan pander to the top 1% and corporate America. In order to reduce deficits at a time when tax rates on those at the top are near 75-year lows, their "United Solution" is to lower rates.
Of course, if you read the bullet point without keeping its heading in mind, you easily could get the feeling that our bi-partisan friends want to close loopholes and eliminate subsidies as a means of raising revenue. Something tells me this misimpression is what the Democrats in the caucus were hoping for. But you need to read closely. The "fair and broad tax plan" is not intended to close loopholes and eliminate subsidies for the purpose of raising revenue, at least not directly (more on that later). Instead, the loophole closing / subsidy elimination is to be done in order "to provide lower rates."
And, reading carefully, our bi-partisan friends do not wish to eliminate all corporate subsidies, but only the "excessive" corporate subsidies and "other subsidies." Unless there is intellectual dishonesty afoot here (now there's a loophole you can drive a truck through), this means the United Solutions caucus intends to identify for us which corporate subsidies that flow to the members of their collective donor base are "excessive" and must be eliminated, and which corporate subsidies are just sort of, you know, modest, run of the mill subsidies. And supposedly, the "other subsidies" must not refer to any corporate subsidies. Otherwise, there'd be no need to single out the "excessive" corporate subsidies. The net-net: the United Solutions gang is going to eliminate all subsidies except those corporate subsidies they do not deem excessive. So, if you're a non-corporate subsidy recipient, buh-bye, but if you're a corporate subsidy recipient, well, what's not to love? They're going to have a friendly discussion about excessiveness with you. And, of course, your lobbyist is most welcome. Oh, and bring your checkbook.
How about the revenue raising? This will be done through a variant of supply side economics in which you deem one segment of the supply side to be more prolific at revving up the economy than another. Under traditional supply side economic theory, you reduce taxes on all those capable of making investments that will spur economic growth. Our bi-partisan friends have refined that strategy. They're going to reduce taxes on some, but not all, of their friends and increase taxes on others by the same amount. In other words, they're going to "redistribute" wealth. Logically, the increased tax on those who have their loopholes closed or "excessive" subsidies eliminated would reduce growth. But because our bi-partisan friends have ascertained that the folks whose taxes will be reduced are the more prolific of the "job creator" class, the gains will outweigh the losses, and we'll be awash in new revenue. It's really quite simple.
And interesting, too. Under W. Bush, we learned that redistributing wealth from the bottom and the middle to the top would spur the economy and generate revenue. Now, we're learning that if we redistribute that wealth from some of those at the top to others at the top, we'll spur growth and generate revenue. The overall result is that we'll have redistributed wealth from the bottom and the middle to a portion of the top. I'm looking forward to see how this works out. I guess if the economy contracts, we could try going the other way — that is, reverse the United Solutions plan, then raise rates further while creating more "excessive" corporate subsidies. Heck, maybe we'll just cut GE a big check each year. Oh wait, we already do.
Of course, last but not least, the United Solutions gang proposes we "encourage innovation with less stringent regulation." At first I thought that was a sop to the porn industry, but they must intend something else. I'm a bit at a loss here because everytime I try to think of an industry other than the porn industry where regulation gets in the way of innovation I think of the finance industry (you know, derivatives, credit default swaps, high-speed trading, etc.). Certainly, 36 freshmen would not be that cynical, would they?
I must say, after this tiny taste of bi-partisanship, partisan bickering doesn't seem quite so bad anymore.
And I hope that after Nancy Pelosi read this, she had a nice, motherly conversation with her 13 young pups and explained to them that they need to be more careful with their lunch money.