Paul Ryan Proposes Massive Tax Cut For the Rich That Adds $100 Billion To Deficit

Prior to January 21 2009, Republicans believed that “deficits don’t matter” and giving away unfunded tax cuts to businesses and the rich was economically prudent. The day Barack Obama was first inaugurated as President, Republicans changed their tune and screamed that not only do deficits matter, but they would in no way allow any government expense to go unfunded; particularly if they could cut spending elsewhere. However, now that the Kochs bought Republicans control of Congress, they are reverting back to their ‘unfunded tax cutting’ scheme and increase the nation’s deficit.

When Republicans took control of the House in 2011, Speaker of the House John Boehner professed that any federal expenses had to be matched with dollar for dollar spending cuts to prevent adding to the deficit. A deficit, by the way, that Republicans increased during the Bush administration by giving the richest one-percent of income earners unfunded tax cuts. Unlike paying for disaster relief after President Obama was inaugurated, tax cuts for the wealthy never included savings from other portions of the budget to be considered revenue neutral because ‘deficits don’t matter” according to Republicans because the deficits benefit the wealthy.

In his first proposed tax reform legislation as chairman of the House Ways and Means Committee, deficit hawk Paul Ryan’s tax plan benefitting big business and the wealthy will increase the deficit by $100 billion over ten years. To make matters worse, Ryan and his Republican cohorts are pushing the tax cuts without any “pay-for” as a permanent part of the tax code that no future tax reform can ever alter; because where tax cuts for the rich are concerned, deficits still “don’t matter.”

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It has to be noted right away that the tax cuts Ryan will blow up the deficit with, without being paid for, will not benefit anyone outside of the rich and big business, but that is what Americans should expect from Republican ‘deficit hawks because something about the storied ‘job creators.’ However, there is nothing in Ryan’s plan that creates jobs.  But then again, Republicans are not in Congress to create jobs because they just create more wealth for the rich.

Ryan’s tax cuts for the rich and corporations (H.R. 644) is actually a package of seven permanent changes to amend the Internal Revenue Code of 1986 to benefit the wealthiest Americans, big business, and corporations. The largest, and costliest, measure allows big businesses to write off expenses faster and adds $77 billion to the deficit that does not matter because it affects the rich. The other parts of the tax cut package allow the wealthy and corporations to write off donations that no regular American will benefit from. The tax right-offs for the rich and corporations include allowing large companies to ‘inflate’ the value of food donations such as “old Twinkies,” make it easier for incredibly wealthy Americans to donate part of their retirement savings and conserve land. All areas that are unique to the wealthy elite and corporations; something Democrats took exception to.

Democrats are concerned that, for one thing, enacting Ryan’s gifts to the rich permanently without funding them will not only perpetually add to the deficit, but they will be permanent loopholes that cannot be negotiated to achieve tax cuts for the middle class in any “future reform efforts.” Representative Earl Blumenauer (D-OR) said “If we’re going to have any hope of a comprehensive tax reform, we’re not going to be able to because it (Ryan’s plan) narrows the range of what we’re going to have going forward.” He also said that since Ryan is “jettisoning deficit concerns” for tax breaks for the rich and corporations, “I’m willing to drop a hand grenade or two in the conversation if you’re going to go down this path. Because I’ve got some things I’m working on that would be extraordinarily popular if we don’t have to worry about fiscal discipline.”

Blumenauer and other Democrats noted that regardless how popular helping the charities and businesses is with the wealthy elite, the tax cuts will only help the richest Americans, large well-off companies holding onto expired but edible food they cannot sell, and the wealthiest Americans with huge retirement incomes. Democrats also complained that the tax breaks for the rich come at the expense of tax breaks that could help the middle class; the kind of tax cuts that Republicans oppose out of hand. Another Democrat, Xavier Becerra (CA) said “it causes a great deal of uncertainty for other Americans who don’t have the benefit of being able to give away their overabundance of retirement money to charitable causes,” and that “this Republican ploy selects almost $100 billion of favored tax provisions to benefit a small wealthy portion of taxpayers by borrowing more money from abroad.” Remember, Republicans oppose any measure that increases the deficit they claim is an abomination to future generations who will be “saddled with debt” to China.

Democrat Lloyd Doggett of Texas put Ryan’s typical Republican unfunded tax cuts for the rich and corporations in another perspective. He said, “Their package eliminates enough revenue ($100 billion) to fund life-saving medical research through the National Institutes for Health for more than two years. Instead of a bipartisan commitment to comprehensive tax reform, they continue on a partisan path to promote the privileged,” or in Republican-speak; the storied “job creator” class.

Despite Democrat’s opposition to the unfunded tax gifts to the rich and corporations, Ayn Rand devotee Ryan said, “These (tax breaks) are consistent with tax reform and are a move in the right direction” because they eliminate important and popular bargaining points from Democrats when tax reform comes up in the near future. Representative Jim McDermott (D-WA) said, “Some of us really would like to have a tax reform compromise come out of here, and we hate to see pieces that could be negotiable given away before there is any final decision making.” It is too bad because Republicans will not negotiate anything away that will benefit anyone other than their wealthy donors and corporations.

This first strike against the middle class to increase the wealth of the rich and corporations by House Republicans is a portent of their idea of ‘tax reform’ based on similar legislation they passed during the last session of Congress. The previous tax legislation would have added more than $800 billion to the deficit because “deficits don’t matter” if corporations and the wealthy benefit. The tax breaks did not get past the Democratically-controlled Senate, but now that the Kochs own the Senate, it is highly likely that tax cuts for the rich will easily pass both chambers and the deficit be damned; so long as it increases without helping anyone but the rich and their corporations.

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