Save the Bush Tax Cuts
Do you want to know what a win-win is in politics? It’s when good policy and good politics meet up. The Bush tax rate cuts, scheduled to lapse in January, are a prime example of an excellent meet-up for GOP candidates. Do Republicans have the smarts to campaign for the extension of the Bush tax rates? Or do the frequently tone-deaf and lily-livered Republicans not get how powerful it is to stump for an extension, especially with a teetering economy? Let’s help stiffen GOP spines with reasons to push tax rate cut extensions.
But let’s first dispel a fear. An outgrowth of that fear is “W” aversion. And, no, that’s not just some Sesame Street-induced aversion to the letter “W,” but an aversion to the man the letter represents. Associating George W. Bush’s name with anything -- from bonbons to tax cuts -- makes gullible Republicans believe it is a certain kiss-of-death with independent voters and persuadable Democrats (a rare breed these days, for sure).
Because the Bush brand is a bit tarnished, Republicans are particularly afraid to invoke the Bush name since Democrats will use it to batter them silly -- even over the always popular issue of tax cuts.
Yet, reality, like time, marches on. The conventional wisdom -- as is often the case -- lags behind changing perceptions. In light of Barack Obama’s abysmal performance, Mr. Bush is experiencing something of a revival in voters’ minds. A poll back in April indicates that Mr. Bush might just give America’s first adolescent president a run for his money in an election. Chances are, given the ensuing Gulf fiasco, among other fiascoes, a Bush-Obama horse race today might even tilt decidedly in W’s favor.
Whatever voters think of Mr. Bush, they think much more of their bank accounts and checkbook balances. Taxpayers are never, ever against keeping more of their hard-earned cash. And with the economy experiencing a tepid recovery, with job reports showing no real growth in private sector employment, and with Greece as the canary in the coal mine twittering about an impending debt and deficit crisis here at home, voters aren’t going to pooh-pooh more money in their pockets.
But skittish Republicans fear two other assaults from Democrats related to making a push for renewing the Bush tax cuts. First, Democratic demagogues will blast Republicans for wanting to keep tax rates that favor the rich. But as any semi-savvy American has learned, the Democrats’ definition of who’s rich has become pretty elastic. Vampirish Democrats, always on the prowl for more dough, claim that income earners who benefit from the lower tax rates are Thurston Howell III and Lovey rich. No small point: those “high” income earners include scads of small businessmen -- and women.
Here, again, voters’ understandings are more sophisticated than condescending and exploitive Democrats allow, especially when voters get clear and direct explanations of who the Democrats think are rich. For instance, the guy who owns the small widgets shop that employs fifteen people -- including your cousin Edith -- who gives generously to the church, and who helps sponsor the local little league, isn’t rich; he’s a friend, neighbor, and employer. He’s one of the standup guys and gals who keep Elmsville from becoming Alms-ville. Or as Democrats would prefer, Government-Handout-ville.
Thus, usually verbally challenged Republicans need to find simple words to make simple but powerful explanations to busy voters about the Democrats’ rich people tall tale. More often than not, commonsense voters will get the argument in favor of lowering taxes or keeping them low over wanting to kick and gut-punch the nation’s producers -- many of whom operate on Main Street near their neighborhoods.
One other important consideration for the GOP is that this year’s election is an off-year affair, which means the party of the president usually loses seats (that means Democrats, to connect the dots for RINOs).
Given the shape of the nation, this off-year election is showing all the signs of being a whopper of an opportunity for Republicans to rack up impressive gains in Congress, particularly in the House. State primary turnout results thus far indicate that the Democratic base is mighty depressed (see Indiana, Ohio, and North Carolina). In other words, flocks of liberal-loving Democrats may choose not to visit the polls the first Tuesday in November.
The key for Republicans isn’t to fear Democratic turnout but to rev-up their base voters and persuade disillusioned independents to touch screens for GOP candidates. Pushing retention of the Bush tax rates is one critical way of doing so.
The other fear that Republicans harbor is that aggressive talk about keeping Mr. Bush’s tax rates -- or pushing for even broader tax cuts -- will open the door to Democrats’ claims that high debts and deficits mean Washington can’t afford a drop in revenues. Time to balance ledgers and clean up the nation’s messy finances, Democrats will argue -- this as President Obama calls for another $50 billion in “stimulus” spending (aka, pork barrel spending to boost Democrats’ election hopes).
Call this argument for fiscal sanity by Democrats the Audacity of the Big Lie, the formula of which Democrats happily apply to just about anything of consequence. Even those of us riding in the backs of turnip trucks know that the Democrats have shot the nation’s debt and deficits so full of steroids as to make the GOP debt and deficits of the middle decade look scrawny by comparison. Given Mr. Obama’s and congressional Democrats’ spending rampage, any Democrat who makes an argument for fiscal responsibility should be mocked and hooted -- by his or her GOP opponent, for starters.
Having said that, otherwise wobbly Republicans need to brush up on the fact-based teachings of the esteemed Arthur Laffer and the superior results of the Reagan and Bush tax rate reductions (keeping a Reagan talisman in GOP candidates’ pockets might help bolster their resolve).
For slow-on-the-uptake Republicans, let’s quickly revisit the facts about tax rate cuts. Regardless of the Democrats’ propaganda, the problem with the national government -- and too many state and local governments -- hasn’t been too little tax revenue; it’s been too much spending. That’s as true for the first decade of the 21st century as it was for 1980s. Year in and year out, tax rate cuts have proven a bonanza to government coffers -- that’s not an opinion, but cold, hard fact.
As Professor Laffer points out frequently, tax rates that are too high reduce government revenues, just as tax rates that are too low fail to generate needed revenue. In terms of Washington, the sweet-spot for tax rate levels are most certainly lower than is currently the case. Keeping the Bush tax rates are only modest steps in the right direction.
But under any circumstance, tax revenues simply aren’t going to keep pace with the Democrats Gone Wild spending and debt accumulation happening in Washington. For Republicans, it’s critical to push less taxes and furiously fight for less spending. The GOP needs to press for a fiscal diet that would astonish Jenny Craig.
So, Republican candidates, repeat after me: “Extend the Bush tax rate cuts!” The more you say it, the easier it becomes -- and the more you say it, the more votes you’ll win in November.