As Republicans double down on the need to extend the Bush tax cuts for the wealthy, most have been unwilling to a offer a way to pay for the lost revenue they represent, while others have concocted a fantasy world where tax cuts pay for themselves.
In an interview with Bloomberg’s Al Hunt yesterday, Minnesota Gov. Tim Pawlenty (R) called for the extension of all the Bush tax cuts, and at least attempted to provide a way to pay for them — use unspent stimulus money to find $40 billion:
HUNT: Okay, alright. $40 billion is what those [Bush tax cuts for the wealthy] cost in one year. Where you take the $40 billion from?
PAWLENTY: That’s easy. You can start by going back and looking at the stimulus package, which is still half unspent, which is not a good package. That could be redesigned and redeployed. And number two, if you look at the growth in federal spending, whether it’s in the entitlement side or the mandatory outlay side or on the discretionary side, you could easily find $40 billion.
First of all, Pawlenty’s figure of $40 billion is pathetic. Renewing the Bush tax cuts for the top two percent of Americans alone would cost $830 billion over ten years, more than 20 times the amount Pawlenty thinks he can find in the stimulus.
But more importantly, Pawlenty is suggesting taking tax cuts away from the middle class in order to give them to the rich. Contrary to conservative talking points, the stimulus package actually cut taxes for 95 percent of working Americans, and there are still $55 billion in tax benefits that have yet to be expended. So removing funds from the stimulus to pay for tax cuts amounts to raising taxes on all of those people.
The tax benefits in the stimulus include the Making Work Pay Tax Credit, which will give up to $400 to working individuals and $800 for working married couples this year; the Additional Child Tax Credit, which makes more families eligible for tax credits; and the Earned Income Tax Credit, which increases tax credits to taxpayers with three or more children. Bottom line: Pawlenty’s proposal is to take money from the middle class and give it to the rich.