Michigan Gov. Rick Snyder (R) is expected to sign a bill into law capping how long state residents can receive Temporary Assistance for Needy Families (TANF) benefits, a federal program which provides temporary financial assistance for struggling Americans:

Gov. Rick Snyder is expected to sign a bill into law capping how long state residents can receive welfare assistance.

The new 48-month limit is expected to result in more than 11,000 people losing benefits at the start of the fiscal year, Oct. 1. The new limit — bringing the cap down from the federal 60-month limit — is projected to save $60 million.

As the Center for Budget and Policy Priorities’ Liz Schott points out, the $60 million in cuts come after Snyder signed into law a $1.7 billion tax cut for corporations. That’s about $30 in corporate tax cuts for every dollar saved in welfare benefit cuts.

Local charities are expressing concern about the TANF cuts, saying that the severe reductions in aid will created increased demand on their already strained resources. “It’s going to impact the demand on the services we offer, that the other pantries offer. It’s going to impact the shelters,” said Alice Rieves, director of a food bank in Port Huron told the Port Huron Times Herald. “I think there’s other things we can do rather than cutting them off state aid,” she added.

As ThinkProgress has noted, Snyder’s tax plan is one of the most regressive in the county, lowering taxes on businesses by 86 percent cut while effectively increasing taxes on residents in lower income brackets.

President Obama and congressional Democrats have been pushing to extend a payroll tax holiday that was enacted as part of the December 2010 tax deal and is set to expire in in January. Congressional Republicans, finally discovering a tax hike that they can get behind, have opposed the extension.

The tax holiday benefits every working American, but Republicans have derided it as having no benefit to the economy. House Budget Committee Chairman Paul Ryan (R-WI) called the holiday “sugar high economics,” while Rep. Jeb Hensarling (R-TX) said that “not all tax relief is created equal for the purposes of helping to get the economy moving again.” A spokesman for House Majority Leader Eric Cantor (R-VA) said Cantor “has never believed that this type of temporary tax relief is the best way to grow the economy.”

However, the Center for American Progress’ Michael Linden and John Griffith note that not only were these GOPers supportive of temporary tax cuts to boost the economy under President Bush — they voted for just such a policy move (plus some additional spending) by approving Bush’s Economic Stimulus Act of 2008:

In January 2008 when the economic picture was far less dire and the unemployment rate was only 4.8 percent, 165 Republicans in the House of Representatives and 33 Republican senators voted to pass a stimulus package with an estimated cost of $152 billion. That package provided tax cuts of up to $600 for individuals or $1,200 for married couples, plus an additional $300 per child. The bill also contained a number of temporary tax breaks for businesses. And just in case you thought President George W. Bush’s stimulus bill was simply a bunch of tax cuts, it also included $40 billion in direct spending. The legislation was even called the Economic Stimulus Act of 2008.

President Bush lauded the Economic Stimulus Act of 2008 for providing “a booster shot for our economy … [putting] money back into the hands of American workers and businesses.” Reps. Eric Cantor (R-VA) and John Boehner (R-OH) as well as Sen. Mitch McConnell (R-KY) all seemed to agree, as did nearly 200 other Republican members of Congress that voted in support of the bill.

In fact, as Linden and Griffith point out, “of the 134 current House Republicans that were also serving in 2008, 85 percent voted in favor of temporary tax cuts and additional spending as economic stimulus,” including Cantor, though he “never believed” in temporary tax measures to boost the economy:

Of course, since President Obama came into office, the GOP has consistently found reasons to oppose ideas that it once supported.

Our guest blogger is Seth Hanlon, director of Fiscal Reform for the Doing What Works project at the Center for American Progress Action Fund.

2012 GOP presidential hopeful Jon Huntsman is releasing an economic plan today that is as bad for the middle-class — and as nutty — as any proposed by his rivals. It would pay for a half-million-dollar tax break for the richest 0.1 percent of Americans with tax increases on the middle-class and new taxes on seniors, veterans, and poor families.

In an apparent attempt to eclipse all previous Republican giveaways, including the disastrous Bush tax cuts, Huntsman would drop the marginal rate paid by the richest Americans by more than a third to 23 percent — a lower rate than rich people paid during the Coolidge and Hoover Administrations or any time since. He would also eliminate all taxes on all capital gains and dividend income — the primary forms of income for the wealthiest Americans.

Huntsman says he will pay for this supply-side bonanza by eliminating all so-called “tax expenditures.” He probably borrowed the idea from a theoretical scenario described by the President’s Commission on Fiscal Responsibility and Reform (aka, the deficit commission). The Commission observed that if all tax expenditures were eliminated, income tax rates could, in theory, be consolidated into three brackets: 8, 14, and 23 percent — the same as what Huntsman proposed today.

But the Commission only offered that scenario as a thought experiment, not as a serious proposal. In fact, no one has seriously proposed to eliminate all tax expenditures because doing so would punish seniors, the middle-class, poor families, and veterans, among others.

Huntsman either hasn’t thought through — or doesn’t want people to know — what eliminating all tax expenditures would actually mean. So let’s take a look at the official tax expenditure list and see what would happen if we got rid of all of them:

– All Social Security benefits would become taxable. Senior citizens that currently receive the average Social Security benefit as their primary income source (as is the case for most seniors) currently pay no income taxes on those benefits, but would under Huntsman’s plan.

– Many middle-class parents would lose child tax credits and tax benefits for education and child care that are more valuable to them than a tax rate cut.

– Huntsman’s tax plan would also eliminate the employer health insurance exclusion, which helps enable some 160 million Americans get coverage through their jobs.

– One of the most successful pro-work, anti-poverty initiatives, the Earned Income Tax Credit, would be abolished.

– Veterans pensions and disability benefits would become subject to tax, as would all military combat pay, military housing allowances and meals, workers compensation payments, public assistance benefits, and state foster care payments.

This is just a partial list of the harsh and/or bizarre consequences that would occur if all tax expenditures were eliminated to fund a huge giveaway to the very rich. Read more

Texas Gov. Rick Perry (R) has built the early stages of his presidential campaign on his state’s ability to create jobs during the last two years of his governorship. The “Texas Miracle,” Perry often says, is responsible for 40 percent of the net new jobs created in America since June 2009. The “Miracle” is no miracle at all — Texas has the nation’s worst job creation record when adjusted for labor force growth — but Republican voters have lapped up the message, pushing Perry to a double-digit lead in early primary polls.

But at a time when federal, state, and local governments continue to shed jobs — more than 500,000 since President Obama took office in 2009 — a bulk of the job creation in Texas has come in the public sector. While Perry espouses small government rhetoric, the “Texas Miracle” created state and local government jobs at a faster rate than any state in the nation, according to 2010 Census data released Tuesday:

Census data showed Texas also boosted employment. The Lone Star state had the biggest percentage increase in state workers, 5.9 percent, from 2009 to 2010. That represented a gain of 17,800 full-time jobs.

Local governments in Texas also added the most part-time jobs of all cities, counties and towns, 24,731.

Texas’ success in the public sector is rare in a country where state and local governments cut more than 230,000 full- and part-time jobs in 2010. The trends have continued in 2011, with local governments cutting more than 100,000 jobs so far this year and with the overall public sector shedding more than 100,000 in just the last three months. Analysts polled by Reuters expect the August jobs report, set for release Friday, to show a net loss of another 30,000 public sector jobs this month alone.

But the state’s success in the public sector goes farther back than 2010. From 2007 to 2010, nearly half of the nation’s government jobs were created in Texas. While Texas lost 178,000 private sector jobs in that period, it gained 125,000 public sector jobs. From 2000 to 2010, public sector employment in Texas grew 19 percent, while private sector growth came at a much more modest 9 percent rate.

As former White House economic adviser Jared Bernstein wrote, Texas under Perry has followed “a traditional Keynesian game plan: as the private sector contracts, turn to the public sector to temporarily make up part of the difference.” But Keynesian economics are anathema to conservative Republican primary voters, who, like Perry, believe the government doesn’t create any jobs at all.

Last week, Republican presidential candidate and former Utah Gov. Jon Huntsman (R) signaled in an interview with PBS NewsHour that as president, he would ask the wealthiest Americans to share in the sacrifice needed to reduce the nation’s debt and deficits. The next day, in an interview with Bloomberg’s editorial board, Huntsman hinted that he would consider treating taxes on capital gains and carried interest as regular income, two de facto tax increases that would primarily affect Wall Street investors, hedge fund managers, and those in the private equity industry. Sixty-eight percent of capital gains taxes are paid by the top 1 percent of American earners.

Just hours later, Huntsman campaign spokesman Tim Miller walked back those comments, saying Huntsman “does not support any policy that would increase the capital gains or carried interest rates.” Now, less than a week after the original comments, Huntsman has proposed a tax plan that would eliminate the capital gains tax altogether, Reuters columnist James Pethokoukis reports:

Huntsman says he would do the following:

1) Eliminate all deductions and credits in favor of three drastically lower rates of 8%, 14% and 23%.

2) Eliminate the Alternative Minimum Tax.

3) Eliminate taxes on capital gains and dividends in order to eliminate the double taxation on investment.

4) Reduce the corporate rate from 35% To 25%. Huntsman would also shift to a territorial tax system and implement a tax holiday for the repatriation of foreign earnings.

The conservative argument against treating the capital gains tax as income is that it would discourage investment and slow economic growth, though as former White House economic adviser Jared Bernstein and the Center on Budget and Policy Priorities have noted, there is little evidence to back up those claims. Warren Buffett discredits the argument totally, saying he has “yet to see anyone…shy away from a sensible investment because of the tax rate on the potential gain,” even when capital gains tax rates were nearly 40 percent in the 1970s.

Taxing capital gains as normal income, as Huntsman seemed to support Friday, could bring in $38 billion in additional government revenue. By gutting the capital gains tax the way he has now proposed to do, Huntsman has effectively moved from asking the rich to share in the sacrifice to providing Wall Street bankers and corporations with humongous tax handouts, ensuring that once again, the only Americans Republicans are asking to sacrifice are those who can afford it least.

Gov. Bob McDonnell (R-VA)

House Majority Leader Eric Cantor (R-VA), along with some of his House GOP colleagues, have been saying that disaster aid for the areas affected by Hurricane Irene must be offset by, in Cantor’s words, “savings elsewhere.” Rep. David Schweikert (R-AZ) said yesterday on Bloomberg News that budget cuts must be a prerequisite for disaster aid in order to reassure “the business markets.” Rep. Peter Roskam (R-IL) added that the days when disaster relief could be funded without offsetting budget cuts “are gone.”

However, not everyone in the GOP agrees that disaster funding should play second fiddle to the GOP’s budget-slashing agenda. Gov. Bob McDonnell (R-VA) yesterday broke with Cantor, saying that “I don’t think it’s the time to get into that [deficit] debate“:

Virginia GOP Gov. Bob McDonnell, breaking with Cantor, on Tuesday suggested that deficit-spending concerns should not be a factor as Congress and the Federal Emergency Management Agency (FEMA) respond to the hurricane.

“My concern is that we help people in need,” McDonnell said during his monthly radio show. “For the FEMA money that’s going to flow, it’s up to them on how they get it. I don’t think it’s the time to get into that [deficit] debate.”

The Hill noted that “before Irene hit, McDonnell had requested emergency help from FEMA in 10 districts, including Cantor’s. All the requests were granted.”

The offsets that Cantor has said would be acceptable to him include cuts to first responders, which prompted Sen. Mary Landrieu (D-LA) to ask, “Does it really make sense to pay for response and reconstruction costs from past disasters by reducing our capacity to prepare for future disasters?” But Cantor hasn’t always believed that disaster aid should be contingent on budget cuts. In fact, in 2004, he requested federal aid following Tropical Storm Gaston, saying that “the magnitude of the damage suffered by the Richmond area is beyond what the Commonwealth can handle,” without a word about offsetting cuts being necessary.

Last year, as Americans across the country grappled with the widespread effects of the Great Recession, tax dodging by corporations and the wealthy cost the average U.S. taxpayer $434, even as corporate profits soared 81 percent. In fact, according to a new report from the Institute for Policy Studies, “corporate tax dodging has gone so out of control that 25 major U.S. corporations last year paid their chief executives more than they paid Uncle Sam in federal income taxes”:

– Of last year’s 100 highest-paid corporate chief executives in the United States, 25 took home more in CEO pay than their company paid in 2010 federal income taxes.

– These 25 CEOs averaged $16.7 million, well above last year’s $10.8 million average for S&P 500 CEOs. Most of the companies they ran actually came out ahead at tax time, collecting tax refunds from the IRS that averaged $304 million.

– CEOs in 22 of these 25 firms enjoyed pay increases in 2010. In 13 of these companies, CEO paychecks ratcheted up while the corporate income tax bill either declined or the size of the corporate tax refund expanded.

Included amongst the 25 are well-known corporate behemoths like General Electric, Boeing, Verizon, and Ebay. Prudential CEO John Strangfeld, in one example, made $16.2 million last year while his company reaped a $722 million tax refund. Bank of New York Mellon CEO Robert Kelly received $19.4 million, after his bank got a $670 million tax refund.

Eighteen of the 25 companies that the IPS studied operated subsidiaries in offshore tax havens. In fact, “the firms, all combined, had 556 tax haven subsidiaries last year,” including 128 for just one company (the reinsurance corporation Aon).

Currently, corporate taxes have plunged to historic lows, with many of America’s largest companies literally paying no federal income taxes. Meanwhile, according to researchers at Northeastern University, corporate profits accounted for 88 percent of real national income growth since 2009, while wages and salaries made up less than 1 percent. In 2010, executive pay grew by 27 percent while wages grew by only 2 percent.

The IPS also found that “of the 25 companies that paid their CEO more than Uncle Sam, 20 also spent more on lobbying lawmakers than they paid in corporate taxes. Eighteen gave more to the political campaigns of their favorite candidates than they paid to the IRS in taxes.”