Sunday, February 19, 2006
The Mother of All Assumptions - $1.35 Trillion in the Bush Budget
Smoke and Mirrors With Our Money
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Of Course, El Jefe will be gone in three and half years and playing golf or killing rattle snakes in Crawford,TX, or whatever that turns him on. But our children and grand children will be paying through their nose for the parting gift for his friends that he has sneaked into his budget. The subservient Republicans in the House are likely to approve it. In the Senate it might run into some opposition. David Broder's column Trillion-Dollar Gimmick in the Post reveals the dirty ploy. It will make you weep unless you happen to be in the top 1% of the tax bracket--the targeted group that reaped most of the benefits.
- In fact, this analysis says, "The administration's proposal, by changing the rules after the 2001 and 2003 tax cuts were enacted but before they are extended, would ensure that the cost of continuing the tax cuts in the years after the current sunset dates would never be counted. The costs in those years were not counted when the tax cuts were first enacted. . . . Now, the administration is proposing that the tax cuts for those years also be ignored when the tax cuts are extended. To fail ever to count the cost of the tax cuts in the years after the sunset dates . . . would represent one of the largest and most flagrant budget gimmicks in recent memory."
- How large? The Congressional Budget Office scores the cost of making these tax cuts permanent at $1.6 trillion over the next decade. The administration's estimate is somewhat less -- $1.35 trillion.
- But, the folks at the OMB told me, it's wrong to claim that they are hiding that cost. They told me to get out my copy of the budget, and they told me right where to look. And sure enough on Column 8, Line 11 of Table S-7 on Page 324 of the green-bordered book, I found the very figure they had cited -- $1.35 trillion.
- The heading on the chart of Effects of Proposals on Receipts reads: "Make Permanent Certain Tax Cuts Enacted in 2001 and 2003 (assumed in the baseline)." Those last four words conceal more than a trillion dollars worth of lost revenue.
