"Pence Redefines Deficit: Only ‘Number-Crunchers’ Think Tax Cuts Have A Cost"
Rep. Michele Bachmann (R-MN) made a bold attempt to redefine the word “deficit” last week during an interview on CNN, telling a perplexed John King that unpaid for tax cuts shouldn’t count as increasing the deficit. “I don’t think letting people keep their own money should be considered a deficit,” she said.
It’s easy to dismiss Bachmann’s bizarre pronouncement as just another in the long list of crazy things she’s said. But CNN was host to another attempt at deficit redefinition this morning, courtesy of Rep. Mike Pence (R-IN). When asked to square his fearmongering about the cost of the tax package before the House today with his desire to permanently extend all of the Bush tax cuts (at a cost of almost $4 trillion), Pence replied that tax cuts only contribute to the deficit in the minds of “Washington number crunchers”:
Q: How can you say the American people didn’t vote for deficits, when at the same time your plan would add almost $3 trillion to the deficit?
PENCE: Yeah, I’ve heard that analysis for years. I know in Washington D.C., they tend, the budget, the numbers-crunchers here tend to think that when they don’t take money from the American people there’s a cost that they ought to round…With a growing economy, I think those predictions are wrong. I think as the economy expands, even revenues to the federal government will expand.
Pence, it seems, believes wholeheartedly in the tax fairy: the notion that tax cuts cause revenue to increase, all actual evidence to the contrary. No serious economist, left or right, subscribes to this notion, and we have ample evidence showing that the Bush tax cuts definitely did not cause a boost in revenue (either in real dollars or revenue as a percentage of GDP).
But House Republicans are so in thrall with the misguided idea that tax cuts do not add to the deficit that they are making it part of their official House-governing rules for next year. As Congressional Quarterly noted today, House Republicans are putting the finishing touches on a new rule called “cut-go,” which requires that new spending programs — but not new tax cuts — be offset with spending cuts:
The budgetary mechanism, which Republicans refer to as a “cut-go” rule, will mandate that lawmakers pay for any new spending program by eliminating an existing program of equal or greater value. It is similar to the pay-as-you-go rule previously introduced by House Democrats except that it does not allow spending increases to be offset with new taxes or fees. Also, tax cuts would not have to be offset with spending reductions.
Pence, of course, would dismiss this as the silly ruminations of number-crunchers, but the Center on Budget and Policy Priorities found that the Bush tax cuts are one of the biggest drivers of the long-term deficit, causing $3.4 trillion in deficits over between 2009 and 2019 alone.