Krugman and Republican Tax Policy

Paul Krugman is one of my go-to pundits, relentlessly pointing out the evidence of history as undermining conservative goals, even though his scope, politics focusing on economics issues, results in his rehashing certain themes over and over.

Here’s one: On Economic Arrogance, from last Monday’s paper.

The essay is in reference to Trump’s budget projections as forecasting rapid economic growth. And how Republican administrations always think this, despite the evidence, and always think cutting taxes for the wealthy will result in ‘trickle-down’ benefits, which they never do. For conservatives, it’s been my impression, ideology always trumps (er) facts and evidence.

As I said, belief that tax cuts and deregulation will reliably produce awesome growth isn’t unique to the Trump-Putin administration. We heard the same thing from Jeb Bush (who?); we hear it from congressional Republicans like Paul Ryan. The question is why. After all, there is nothing — nothing at all — in the historical record to justify this arrogance.

Meanwhile, the growing polarization of American politics has given us what amount to economic policy experiments at the state level. Kansas, dominated by conservative true believers, implemented sharp tax cuts with the promise that these cuts would jump-start rapid growth; they didn’t, and caused a budget crisis instead. Last week Kansas legislators threw in the towel and passed a big tax hike.

At the same time Kansas was turning hard right, California’s newly dominant Democratic majority raised taxes. Conservatives declared it “economic suicide” — but the state is in fact doing fine.

The evidence, then, is totally at odds with claims that tax-cutting and deregulation are economic wonder drugs. So why does a whole political party continue to insist that they are the answer to all problems?

The answer…

It would be nice to pretend that we’re still having a serious, honest discussion here, but we aren’t. At this point we have to get real and talk about whose interests are being served.

Never mind whether slashing taxes on billionaires while giving scammers and polluters the freedom to scam and pollute is good for the economy as a whole; it’s clearly good for billionaires, scammers, and polluters. Campaign finance being what it is, this creates a clear incentive for politicians to keep espousing a failed doctrine, for think tanks to keep inventing new excuses for that doctrine, and more.

Which is to say, as I’ve noticed for decades: for Republicans, the answer, no matter what the state of the economy, is always to cut taxes, especially for the wealthy. It comes across as a popular issue–who doesn’t want lower taxes?–no matter how irresponsible it would be for keeping the government running, and all that it does. The rationale is, if the economy is doing well, the people need to keep more of their money. If the economy is doing poorly, it needs to be stimulated by cutting taxes for the wealthy, so they’ll hire more people and grow the economy. Except the evidence doesn’t show that that ever works. What is working, is that the wealthy support the Republican party, who supports cutting *their* taxes at every opportunity. So they can buy another yacht.

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