You can subtitle this one, "I'll get my tax increase yet, you wascawy Wepubwicans!"
Over at Powerline John Hinderaker publishes the text of a letter from Senator Jeff Sessions to Mr. Obama's Director of the Office of Management and Budget (OMB) Jacob Lew. If you thought that when President Obama took to the airwaves last Thursday in front of a joint session of Congress to introduce and sell his American Jobs Act that there a) actually was an American Jobs Act and b) that bill was ready for Congress to evaluate it's economic impact, well, think again. The letter reads in part:
When we received a copy of the legislation yesterday, we were expecting the Office of Management and Budget–which enjoys a five hundred person staff–to provide a precise and detailed estimate of the fiscal impact of the president’s proposal. But no such information was provided.
This is not satisfactory.
Perhaps even more troubling, however, is that despite the emphatic promise that we would learn yesterday how the bill would be offset, this information is missing too.
Given the depth of the economic crisis we now face–slow growth, high debt, and chronic unemployment–the lack of fiscal detail that has been provided to Congress is both disappointing and irresponsible...
When the president submitted his budget in February you declared: “our budget will get us, over the next several years, to the point where we can look the American people in the eye and say we’re not adding to the debt anymore.” In reality, the budget would have increased our debt by $13 trillion.
Read that last paragraph again. The budget submitted would increase over 10 years the cumulative national debt by $13 trillion. Recall that we just raised the debt ceiling due to passing $14.5 trillion cumulative debt - that amount accumulated over the course of 235 years. So when the OMB director states that their budget "will get us, over the next several years, to the point where we can look the American people in the eye and say we’re not adding to the debt anymore," it's not because of spending restraint. It's because of plans for much, much, much higher levels of taxation.
Mr. Hinderaker helpfully includes an excerpt from a Washington Examiner editorial making the ploy evident. The Examiner notes that Director Lew outlined some of the increased revenues the President is seeking in this bill - and they're the same ones he wanted as part of deficit reduction earlier in the summer. Wanted, but didn't get. The Examiner editorial asks a very pertinent question.
Pressed to explain how Obama could use the same tax hikes to both meet the debt deal’s deficit reduction targets and pay for his new stimulus plan, Lew admitted that even Obama can’t count the same tax increases for two separate purposes. Instead, Lew said that Obama would be introducing a whole new slate of tax hikes next week, when he plans to give yet another deficit reduction speech.
Obama again insisted Monday that his second stimulus will be “fully paid for.” This is problematic on several levels. If Stimulus II is fully paid for with immediate tax hikes, then it isn’t the kind of deficit spending that Obama’s Keynesian logic demands. If it is only paid for later, at the end of the 10-year horizon, then this amounts to a budget gimmick, because Obama will be long gone from office by then.
That is, if the tax hikes go into effect now for the jobs bill, then the bill is "paid for" with tax increases - tax increases on job producers in the middle of a stagnant economy with no job growth. If the tax increase are delayed, and Keynesian "spend now, settle up later" is the plan, then it amounts to kicking the can down the road, burdening future congresses, future presidents, and future taxpayers with irrationally exhuberant debt. $13 trillion in 10 years indeed.
But look again at the statements of Mr. Lew. "Instead, Lew said that Obama would be introducing a whole new slate of tax hikes next week." I assume these would be in addition to those listed already. Ugh. These will be once again proposed with a prominent class warfare backdrop, and the word "fairness" will figure prominently, I'll bet. There won't, of course, be any definition of "fairness," and there won't be any mention of the fact that such tax increases burden businesses, investors, and job producers at the very point in time that they're needed most.
And if the "wascawy Wepubwicans" fail to raise the taxes that Mr. Obama's filibuster-proof Democratic congress previously refused to raise during a time of economic uncertainty? I can see the demagoguery coming, it's coming 'round the bend. And we won't see the sunshine since I don't know when.