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Toomey: ‘It’s Not Clear’ That Extending Bush’s Tax Cuts Would Increase The Deficit

Some Republican Senate candidates have suggested that extending the Bush tax cuts — which are scheduled to expire at the end of the year — will actually be good for the country’s bottom line, as the economic growth that results will more than offset the trillions of dollars in lost revenue. “By extending tax cuts you pay down the deficit, you grow the economy by giving people more money,” said Colorado Republican Ken Buck.

Today, on Fox News Sunday, Pennsylvania’s Republican Senate nominee Pat Toomey joined this club, telling Fox’s Chris Wallace that “it’s not clear” that extending the Bush tax cuts — while also lowering the corporate tax rate — would increase the deficit:

WALLACE: If you extend all the Bush tax cuts, if you were to cut, not eliminate, but cut the corporate tax rate — although that would produce some economic growth and therefore some increased revenues — there no question that would add trillions of dollars to the deficit. The question becomes, what are you going to cut? What are you going to cut in spending, what are you going to cut in entitlements, and I’d ask you to be specific sir.

TOOMEY: Sure. But first of all, it’s not clear that that would add trillions to the deficit, because I really believe that if we expand the base of the economy, which we could do by selectively lowering some taxes, you have a broader base on which to apply the tax.

Watch it:

As American Action Forum president Douglas Holtz-Eakin, who was formerly the Congressional Budget Office director and an adviser to the McCain 2008 presidential campaign, said, “there is no serious research evidence to suggest” that tax cuts pay for themselves. Extending the Bush tax cuts costs more than $3 trillion over ten years, while extending the cuts just for the wealthiest two percent of Americans costs $830 billion over that period.

According to the Center on Budget and Policy Priorities, the Bush-era tax cuts are one of the largest drivers of the country’s long-term structural deficit. And, contrary to Toomey’s assertion, simply lowering taxes doesn’t broaden the tax base (which is accomplished by removing subsidies, loopholes, and giveaways in the tax code).

Toomey was also wrong to suggest that the Bush tax cuts increased revenue: in 2000, the government collected 10 percent of GDP in personal income taxes, a percentage that has never been collected since the Bush tax cuts. Plus, the historical record of the Bush tax cuts suggests that they won’t create the sort of economic growth that Toomey is counting on. In fact, following the Bush tax cuts, the country “registered the weakest jobs and income growth in the post-war period”:

Overall monthly job growth was the worst of any cycle since at least February 1945, and household income growth was negative for the first cycle since tracking began in 1967. Women reversed employment gains of previous cycles. And for African Americans, the worst job growth on record was matched by an unprecedented increase in poverty.

On a final note, Toomey never did identify anything he would cut from the budget to offset the cost of his budget-busting tax cuts.

LGBT

Frmr. Joint Chiefs Of Staff Chairman: ‘We Haven’t Lost’ To Nations With Open Gay Servicemembers

This morning, former Joint Chiefs of Staff Chairman Gen. Hugh Shelton suggested that openly gay servicemembers could undermine the U.S. military, telling ABC’s Christiane Amanpour that the United States has never lost a war to a foreign country that allows open service:

AMANPOUR: Would you support [ending don't ask, don't tell] if the Pentagon review says it’s time to get rid of it?

SHELTON: If the men and women in uniform at the fighting level, particularly the Marines and Army say, ‘no it doesn’t make any difference to us,’ and therefore it won’t break the readiness of our great armed forces…

AMANPOUR: Why do you think it would? I mean some of the great allies of the United States have. Whether it’s Canada, whether it’s Britain, France, Australia, even Israel allows openly gay men and women to serve in the military. And they have great armies, great militaries.

SHELTON: They have great militaries, great armies. But if you check the historical records, Christiane, as you know, we’ve never lost to any of them. We are the top of the pile. We are the best in the world. And we want to stay that way.

Watch it:

Shelton’s argument is confusing because “the historical records” also show that the United States has not engaged in armed conflict with these nations since they’ve allowed open service and their experiences actually reveal that open gay servicemembers don’t undermine military readiness or effectiveness. (H/T: @tcmassie)

Climate Progress

˜U.S. Chamber of Commerce pro-GOP, pro-pollution ad blitz is fueled by foreign oil

The United States Chamber of Commerce is running an unprecedented $75 million campaign to unseat progressives from Congress, in defense of a big-oil agenda.  The oil-fueled Chamber has hammered candidates who voted to limit our dependence on oil, falsely claiming they supported a “job-killing energy tax” (like Rep. Paul Hodes (D-NH), Rep Joe Sestak (D-PA), Rep. Betsy Markey (D-CO), Rep. Alan Grayson (D-FL), and Rep. Harry Teague (D-NM)).

As a ThinkProgress investigation has learned Chamber’s donors “” who send their checks to the same account from which the political campaign is run “” include multinational oil corporations, and even oil companies owned by the Kingdom of BahrainBrad Johnson has the story.

Read more

Security

Rubio And Crist Say The Iraq War Made America And The World ‘Safer And Better Off’

This morning, CNN hosted a debate with Republican, Democratic, and Independent candidates for Florida’s Senate seat, Marco Rubio, Rep. Kendrick Meek, and Gov. Charlie Crist. The three candidates debated a variety of current issues, and highlights included Crist and Rubio stating that they felt that all of the Bush tax cuts should be extended, even those for the wealthiest Americans.

At one point, a CNN moderator asked the candidates if “America is safer and better off for having gone to war in Iraq?” Rubio responded, “I think ultimately yes. First of all, the world is better off because Saddam Hussein is no longer in charge….The world is a safer place not to mention the Iraqi people are better off than they were under Saddam Hussein.”

Meek went next, saying that the “war was based on falsehoods and not on fact” and refused to give a “blanket yes” to the question of whether the world was safer thanks to the war. The congressman continued, “I think we would’ve been better off if we had looked at diplomatic solutions and hadn’t been lied to by the Bush administration.”

Crist then gave the last answer. “I think the world is a safer place because of the action we took in Iraq,” he concluded:

MODERATOR: Mr. Rubio, is America safer and better off for having gone to war in Iraq?

RUBIO: I think ultimately, yes. First of all, the world is better off because Saddam Hussein is no longer in charge. He is no longer in charge of that country. Let’s understand one thing. Right now we’re worrying about Iran possessing a nuclear weapon. If Saddam Hussein was still there you’d have a full-blown arms war the way you’ve seen between Pakistan and India. So the world is a safer place not to mention the Iraqi people are better off than they were under Saddam Hussein. [...]

MODERATOR: Mr. Meek, same question.

MEEK: Well I would tell you this. There was a no-fly zone prior to going to war in Iraq. It was a war based on falsehood and not on fact. And also there are a number of American lives that have been lost. Saying that, those sacrifices that have been made, it’s important to note that the international community needs to continued to be engaged in Iraq. The largest U.S. embassy in the world is in Iraq because of the Bush doctrine. I understand the situation as to the world being safer because we went into Iraq, I couldn’t give you an overall blanket yes on that.

MODERATOR: Do you think we would’ve been better off if we hadn’t gone in?

MEEK: I think we would’ve been better off if we would’ve looked at diplomatic solutions and wouldn’t have been lied to by the Bush administration. I think a number of American lives would’ve been saved and this would be a different world if we would’ve given diplomacy an opportunity.

CRIST: I think the world is a safer place because of the action we took in Iraq.

Watch it:

It is an oddity of American political life that, more than seven years after the Bush administration launched its illegal and disastrous war in Iraq that cost the lives of hundreds of thousands of people unnecessarily, that major political players are still debating whether or not the war made our country and the world “safer and better off.” Nevertheless, it is important to dismantle the claims put forward by Rubio and Crist.

Rubio displays a hefty ignorance history by claiming that an Iraq under Saddam Hussein would’ve engaged in an arms war like that between India and Pakistan. Ever since the Gulf War, Iraq was under draconian sanctions that reduced its military to levels where it was completely unable to threaten any of its neighbors — and, unfortunately, exacted an enormous human cost on its civilian population. There could have been no arms race because Iraq did not have access to the materials to make them.

Rubio and Crist both claim that the world is a safer place thanks to the war in Iraq. The facts tell very a different story. In 2007, terrorism experts and research fellows at Center on Law and Security at the New York University School of Law Peter Bergen and Paul Cruickshank conducted a survey of terrorism incidents worldwide since the Bush administration-led U.S. war in Iraq. Their study found that terrorism incidents worldwide increased by seven times, or six hundred percent, since the Bush administration invaded Iraq.

More recently, researchers Robert Pape of the University of Chicago and James Feldman of Air Force Institute of Technology found that, “from 1980-2003, there were 350 suicide attacks in the world, only 15% of which were anti-American.” Yet after the Bush-led war in Iraq, “there have been 1,833 suicide attacks, 92% of which were anti-American.”

Whether is Iraq is “better off” is more of a subjective question, but the level of suffering borne by the Iraqi people suggests they are not. In 2004, a year after the toppling of Saddam Hussein and well-before the spike in levels of violence that started with the sectarian warfare in 2005, Iraqis were 58 times more likely to die a violent death than they were before the invasion. Sectarian tensions and a fragile political system led to Iraq breaking the world’s record for the longest time without a government. Damage to the country’s infrastructure limits Iraqis to an average of five hours of electricity a day, and a recent document dump by the whistleblower organization Wikileaks has uncovered tens of thousands of previously unreported civilian deaths and the widespread use of torture and other brutal military techniques by the Iraqi government. All of this is without noting that hundreds of thousands of Iraqis have lost their lives, entire generations of children have grown under occupation or in sectarian warfare, and millions fled the country. All for the cost of $4-$6 trillion dollars, according to Nobel Prize winning economist Joseph Stiglitz.

LGBT

Sullivan: Obama Raised Bar On DADT Discharges After Realizing He Couldn’t End Policy In Senate

This morning, the Atlantic’s Andrew Sullivan argued that the Pentagon’s decision to limit the number of people who can approve discharges under Don’t Ask, Don’t Tell was a result of President Obama’s own realization that the Senate will not be able to pass legislation ending the policy after the midterm elections. Appearing on NBC’s The Chris Matthews Show, Sullivan said that the new discharge rules signaled an end to the policy:

SULLIVAN: I think the president has realized that he’s not going to be able to end Don’t Ask, Don’t Tell in the lame duck session. So he’s done something very interesting. He has reserved the decision to fire openly gay servicemembers to just five senior Pentagon officials. They will have to approve every discharge and they will not. So this thing will die on the vine.

Watch it:

Advocates expect the number of discharges to decrease, since the policy will effectively be in the hands of Obama’s appointees. Defense Department officials, however, are publicly stressing that the new discharge rules do not represent any kind of moratorium of the policy. “I wouldn’t interpret that as a higher bar, a lower bar,” a defense official told reporters on Thursday. “That is not intended to be a substantive change in the decision-making. You should not interpret that as we are going to separate more people or less people. We are going to elevate these decisions to ensure uniformity and care in the enforcement of the law. It is what it is,” the official said.

Earlier this week, White House senior adviser Valerie Jarrett still insisted that the administration was committed to repealing the ban in the lame duck session. “We do fully intend to push forward…we are determined to get it done,” she said.

Climate Progress

The GOP flip flops on cap and trade

Cap and trade was conceived by Reagan, delivered by Bush Sr. and praised by Bush Jr. The GOP is now demagoguing it to death.

Opposition to “cap-and-trade” legislation to reduce global warming pollution is a common refrain among many Republican and a few Democratic officials this fall. The program is derided as a “cap and tax” that would drain voters’ wallets while bankrupting the nation.

But, ironically enough, the three most recent Republican presidents promoted cap and trade, including Ronald Reagan, as CAP’s Daniel J. Weiss explains in this cross-post.

Read more

Yglesias

The Back Catalog

Julian Sanchez writes that highbrow film is increasingly facing competition from its own back-catalog:

On the movie side, though, I don’t think it’s that movies as such are in decline as elite entertainment, but that technology has effectively forced new highbrow movies to compete with the cinema’s ample back catalog. Twenty years ago, if you wanted to have a “home entertainment center” that could serve as a decent substitute for the theatrical experience, you pretty much had to be willing to drop ten grand and devote a room of your house to it. Now a 50″ high-definition TV can be had for a few hundred dollars, and will fit against the wall of an apartment living room. It’s not a perfect substitute: If you want to get a big group of people together and make a social event of seeing a big flashy action movie with the latest special effects, the theater is still probably your best bet. But if you want to watch The Seventh Seal or Citizen Kane with a couple other people, it’s a viable alternative in a way that the smaller standard-def TV you’d find in an equivalent middle class home circa 1990 just wasn’t. Moreover, for the cost of a $10 monthly Netflix subscription, you’ve got an ample and growing library of both classic and recent movies available on demand. Once those costs are sunk, and once the audio-visual quality is high enough, a lot of people will actively prefer to watch a quieter or more thoughtful movie at home with a glass of wine.

Here, again, if you’re in the mood for (say) a big flashy sci-fi action movie, improvements in filmmaking technology mean that the latest theatrical release is going to have enough of an advantage to be competitive with the back catalog. Whatever else you might say about it, Inception is visually a lot more impressive than most old action sci-fi movies. (There are exceptions—Blade Runner springs to mind—but not a ton.) But if you’re looking for a smart, artistically shot film with smart dialogue? Unless you’re a truly voracious film buff, there are probably a couple hundred Criterion Collection films you haven’t seen that are superior on those dimensions to anything made this year. Time and tech do a lot more at the margin to improve flicks than films.

This is logical to me although it doesn’t meet my life experience. I went to see It’s Kind of a Funny Story on Monday at the local Landmark Theater even though I could have watched The Big Sleep on Netflix streaming at home and almost certainly seen a better movie. To me, at least, the movie theater has become an unusual point of refuge from the ubiquitous connectivity of my laptop, smart phone, iPad, etc.—a place where social convention makes you shut up and watch in a way that’s hard to achieve at home.

But then again, I live in easy walking distance to two movie theaters. If going to catch something new weren’t a matter of a 5 minute jaunt to Gallery Place or a 15 minute stroll to E Street I might have a different attitude. Do you need to wait for the bus to go see a movie when you could just watch at home? Maybe not. And the calculus looks very different if you have kids and going to the movies versus just watching one after you’ve put them to bed involves adding the cost of a sitter, etc.

Update

After writing this I thought “why not just watch The Big Sleep“? So I did. Good movie. But I did find myself periodically distracted by email, twitter, etc.

Politics

Vast Stretches Of Oil Still Contaminate The Gulf

Six months ago, BP’s Deepwater Horizon rig exploded, killing eleven men and beginning an ecological catastrophe that flooded the Gulf of Mexico with approximately five million barrels of oil over the ensuing months. The effort to assess the damage continues, as does the tortuous claims process for the thousands of affected residents. Following news headlines that the oil had “largely disappeared” by August, nearly all of the Gulf waters closed to fishing have been reopened, and the Coast Guard has declared “very little recoverable oil” remains. However, the disaster is not over:

Just three days after the U.S. Coast Guard admiral in charge of the BP oil spill cleanup declared little recoverable surface oil remained in the Gulf of Mexico, Louisiana fishers Friday found miles-long strings of weathered oil floating toward fragile marshes on the Mississippi River delta.

New Orleans Times-Picayune photojournalist Matt Hinton confirmed the sightings in an overflight of Louisiana’s West Bay:

Because of the disaster, BP’s third quarter profit was only $4.6 billion.

Yglesias

The USA Is Not Very Import-Dependent

One response to my proposal to stimulate demand with a helicopter drop of money is the idea that the benefits will somehow all flow to Asia:

So, you give me an envelop full of cash, I go and buy a pair of shoes made in China, and a TV set made in Korea. That will certainly stimulate China and Korea; though it’s not quite clear to me what they are going to with that cash.

I think this reflects a widespread misunderstanding about the impact of trade on the United States economy. Not misunderstanding about the merits of trade even, just misunderstanding about the extent of trade. The United States is a very big country and consequently we’re actually a country that doesn’t trade all that much compared to most developed nations. You can see this if you look at imports as a share of GDP in the top ten economies (GDP calculated at market exchange rate levels here because we’re talking trade):

As you can see, we do less importing than ever country on this list except Japan and Brazil. Importing is an important part of American economic life, but it’s not that important. The vast majority of US demand for goods and services is met domestically and the United States is more reliant on the internal market to meet its demand than are China or Canada or Germany or what have you.

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