The NY Times' Paul Krugman clearly believes that growing the economy and job growth should be secondary concerns to class warfare and redistribution. That seems to be the take-away message from this column on the wrangling over January's coming tax increases. (note: he routinely employs the "let the tax cuts expire" dodge that liberal prefer)
Democrats have tried to push a compromise: let tax cuts for the wealthy expire, but extend tax cuts for the middle class. Republicans, however, are having none of it. They have been filibustering Democratic attempts to separate tax cuts that mainly benefit a tiny group of wealthy Americans from those that mainly help the middle class. It’s all or nothing, they say: all the Bush tax cuts must be extended. What should Democrats do?
The answer is that they should just say no. If G.O.P. intransigence means that taxes rise at the end of this month, so be it.
So Mr. Krugman's answer, then, is this: If the price of avoiding a tax increase for the "middle class" is a tax increase for job creators and investors, then let them all eat cake. To hell with economic growth and reduced unemployment! Mr. Krugman tries to hide the significant differences in job creation like this:
...To be sure, letting taxes rise in a depressed economy would do damage — but not as much as many people seem to think.A few months ago, the Congressional Budget Office released a report on the impact of various tax options. A two-year extension of the Bush tax cuts, it estimated, would lower the unemployment rate next year by between 0.1 and 0.3 percentage points compared with what it would be if the tax cuts were allowed to expire; the effect would be about twice as large in 2012. Those are significant numbers, but not huge — certainly not enough to justify the apocalyptic rhetoric one often hears about what will happen if the tax cuts are allowed to end on schedule.
Let's leave aside the fact that economic projections are mere fantasy, or don't you recall that the White House Budget Director predicted that the 'stimulus' would keep employment to 8% or less? Let's assume that there'll be a drop of 0.3% if the current rates are continued, the upper end of CBO projections. That translates to about 500,000 additional employed by year end 2011. The projection is that the effect would double for 2012, perhaps an additional 0.5% drop. Mr. Krugman would like you to believe that a 0.8% fall in unemployment by year end 2012, or an additional 1,500,000 jobs isn't worth it. It's far preferable for him to encourage Mr. Obama to stand up to those evil Republicans, the greedy SOB's.
I'm sorry, but I think it is is preferable to pursue policies that spur economic growth and job creation. I suspect you do also.
As an aside, in making his case Mr. Krugman also pretends that gutting social security and Medicare are necessary if the tax increases fail to go into effect. Again, speaking of gutting entitlements, I won't deal right now with ObamaCare's directive to cut $500B from Medicare and to set up a rationing board. But I will let Cato's Dan Mitchell tell him how the budget deficit can decline through spending control and economic growth.
