Eric Cantor told Chris Wallace today that he would not rule out shutting down the government and allowing the United States to default on its debts — and then he announced that if Republicans did do that, Pres. Obama would be responsible.
Meanwhile, Mitch McConnell declared, in response to a question from Bob Schieffer on Face the Nation about Obama’s expressed willingness to compromise on extending the Bush tax cuts for wealthy Americans, that those tax cuts were actually tax increases. He also, as usual for Republicans, declined to say how Congress would pay for the $700 billion in lost revenues if the tax cuts for the rich were extended, and repeated the Republican lie about small businesses being harmed if the tax cuts for the rich were not extended:
By talking about the taxes to be paid by those earning above a quarter-million per year, McConnell said, the “so-called upper-income thing diverts people away from the following fact . . . you raise taxes on 750,000 of our most productive small businesses, which represents 50% of small business income and 25% of the work force, at a time when job creation is just bumping along.
“We really think that’s a bad idea,” he said.
[In an August 2010 article titled “Five Myths About the Bush Tax Cuts,” the Washington Post reported that “Less than 2 percent of tax returns reporting small-business income are filed by taxpayers in the top two income brackets.”]
“I have to ask you, Senator McConnell, when you’re talking about extending those tax cuts for upper-income Americans, the estimates are that will cost $700 billion over the next ten years,” Schieffer said. “If you take all the tax cuts together you’re talking about $4 trillion dollars. How do you intend to pay for those tax cuts?”
“Bob, it only costs $700 billion if you consider it the government’s money,” McConnell replied. “This is our money. This has been the tax rate for almost a decade.”
McConnell said the problem was [I think that’s a typo; it should be “wasn’t] that government wasn’t taxing enough to cover the costs of its services, but that it was spending too much.
So what spending are Republicans looking to cut, and how much? The answer is, everything except the military:
To make good on their campaign pledge to reduce the size of government, Republicans say they are planning a series of quick moves to slash spending soon after they take control of the House in January. Among the likely options: a massive rescissions package that aides said would slice 20 percent from most domestic agency budgets and enact $160 billion in additional cuts endorsed by visitors to Cantor’s “YouCut” Web site.
Such a package would trim more than $260 billion from this year’s $1.1 trillion budget for most government operations – the biggest one-year reduction at least since the military drawdown after World War II, budget experts said.
Because Republicans propose to exempt the Pentagon, veterans programs and homeland security from these cuts, liberal analysts said the reductions would decimate education funding, the National Park Service and other worthy programs.
Movement conservatives are not satisfied with such baby steps, and they want to hold the debt ceiling hostage to Republicans getting everything they want:
“This is a good start, but Congress can do much more,” said Brian Riedl, lead budget analyst for the Heritage Foundation, who recently put out a list of $343 billion in cuts for congressional perusal. “Government has expanded by $727 billion over the last three years. Congress should be able to cut at least half of it.”
Such a rescissions package would come nowhere near balancing the budget and would barely dent the $1.4 trillion deficit the White House projects for this year. That means Treasury Department borrowing will continue apace, setting the stage for a showdown sometime next spring when Republican leaders will have to rally their troops to support an increase in the legal limit on government debt – or force the nation into default.
Congress routinely votes to raise the federal debt limit and last did so in February.
But conservatives such as Rep. Jim Jordan (R-Ohio), incoming chairman of the Republican Study Committee, are already lining up to demand even deeper cuts in exchange for their vote to permit the national debt to keep climbing past the current limit of $14.3 trillion.
“They really need to tie it to full extension of the Bush tax cuts or major spending cuts,” said Ryan Hecker, the Houston attorney behind the tea-party inspired “Contract from America,” which was signed by dozens of GOP candidates. “If they’re going to raise the debt limit, we would need to see some real economic conservativism [sic] in return.”
Republicans and conservatives in general are fond of saying that Barack Obama and the Democrats misread the scope and nature of the mandate the voters gave them in 2008. It’s fascinating to watch the same people yelling “Go! Go! Go!” as GOP leaders enthusiastically propose a laundry list of all the most extreme items on the right’s ideological wish list. Whatever righties may believe about Americans voting for smaller government and lower taxes, only the most delusional would think that those Americans voted for cutting half of the domestic budget while leaving the military untouched, and shutting down the government if Democrats don’t go along. I guarantee you, that is NOT what Americans voted for. And Republicans are in for a very rude awakening in two years if they go down that road.
If they do, I don’t know how anyone with a conscience or an ounce of principle could support a party that could do such things, or even threaten to do them.
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