” If someone had woken you from a dead sleep 20 years ago and asked what the Republican Party stood for, you would’ve had no trouble answering: Fiscal restraint, a strong national defense and lower taxes. Those were the three pillars of the GOP. The party’s brand was clear. Voters understood it, and many approved. In the days before Obama, Republicans won seven out of ten presidential elections.
Things have changed for the muddier. Scratch the surface and you’ll find there is no longer a consensus among Republicans on foreign policy. Fiscal restraint? Years of earmarks, record deficits and at least one new federal entitlement under Republican congresses make that idea a bitter joke.
Of the three principles that have united the party since Reagan, only taxes remain. Republicans have been able to claim — sincerely, and with continuing success at the ballot box — that they are for lower taxes.
Here’s what happened: For reasons that aren’t entirely clear but are probably related to panic and a basic lack of principle, the Speaker of the House and other Republicans in Congress signed on to Democratic calls for “balance” between tax hikes and spending cuts — this despite the overwhelming evidence that spending is the real problem. “
So, even before the negotiation began, they abandoned decades of principle on taxes. The result: Two months later, we have a deal, but no balance. It’s all tax hikes. Zero spending cuts. Nice job.
Illustration By Michael Ramirez
” You know, Republicans, if you spent half as much time marketing good policy as you do bending over backwards to please your ideological opponents, we might actually have a deal worth talking about.
In addition to the basics, there are some other interesting facts to note about this deal.
ABC News reports:
But it also includes these:
- $430 million for Hollywood through “special expensing rules” to encourage TV and film production in the United States. Producers can expense up to $15 million of costs for their projects.
- $331 million for railroads by allowing short-line and regional operators to claim a tax credit up to 50 percent of the cost to maintain tracks that they own or lease.
- $222 million for Puerto Rico and the Virgin Islands through returned excise taxes collected by the federal government on rum produced in the islands and imported to the mainland.
- $70 million for NASCAR by extending a “7-year cost recovery period for certain motorsports racing track facilities.”
- $59 million for algae growers through tax credits to encourage production of “cellulosic biofuel” at up to $1.01 per gallon.
- $4 million for electric motorcycle makers by expanding an existing green-energy tax credit for buyers of plug-in vehicles to include electric motorbikes.
*Note the price tags above reflect estimated forgone tax revenue if current credits – which have been due to expire – are extended for one year as included in the Senate bill, per Joint Committee on Taxation.
Jim Pethokoukis writes:
What will Americans pay in taxes this year vs. last year in light of the fiscal cliff deal? Well, let’s run the numbers (with some help from JPMorgan):
– Payroll tax hike: $125 billion
– Income tax hike and the phaseout of exemptions: $35-50 billion
– Investment tax hike: $5 billion
– PPACA healthcare taxes: $38 billion
So that works out to roughly $220 billion, or 1.2% of GDP. It’s a deal that, as The Washington Post puts it, ”takes money out of the hands of many Americans, sucking it out of the economy and slowing economic activity.”
Obama made it clear last night that he has no interest in negotiating when it comes to the debt ceiling. He has also made it clear that this is the start of his tax-hike demands, not the end. “
Illustration By Steve Sack