Biased Arguments And The Tax Policy Center

Established in 2002, by tax policy experts from Reagan (GOP), Bush I (GOP), and Clinton (DEM) administrations, the Tax Policy Center is now under fire by conservatives as biased.  Here's why:

"Our major conclusion (Tax Policy Center) is that a revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed - including reducing marginal tax rates substantially, eliminating the individual alternative minimum tax (AMT) and maintaining all tax breaks for saving and investment - would provide large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers."

God forbid they crunch Romney's purposefully vague budget plan!  There is a litany of conservatives who are bashing TPC as "biased"... Bill O'Really, WSJ, and Washington Post editors have all piled on the "Tax Policy Center is Biased" bandwagon.  Contradicting previous statements that TPC was non biased.

To further illustrate the point that the Tax Policy Center is NOT biased look to it's director.  Donald Marron served on George W. Bush's Council of Economic Advisers.  Right???

Paul Ryan's budget plan is basically Romney's budget plan... no matter how much Romney wishes to withhold details.

Here is what you can expect.

In many cases, low-income households would see a tax increase of $100 or less, but some would be hit harder. Among households earning between $10,000 and $20,000 a year, about 1 in 5 would get a tax increase averaging over $1,000, the Tax Policy Center analysis showed. Households earning more than $1 million a year would get nearly 40% of the benefits of the plan, with a cut averaging about $265,000.

In 2010, Ryan pushed a plan forward that would entirely eliminating taxes on capital gains, interest and dividends.  Though the plan didn't get traction, Ryan hasn't retracted the "no taxes for billionaires plan".

As a stated Catholic, Paul Ryan's budget was so draconian, the U.S. Conference of Catholic Bishops condemned it "unjustified and wrong" and void of social justice.

They join a bevy of other religious groups condemning Paul Ryan's budget:

• NETWORK:  "We agree with Catholic Bishops that Paul Ryan's budget fails the test of Catholic Social Teaching since it deliberately harms people at the economic margins. It is also unpatriotic because it says that we are an individualistic, selfish nation. This is emphatically not who we are. Both our Constitution and our faith teach us that "We the People" are called to care for one another, to have responsibility for each other. This year's election will present us with a critical choice. Do we want to favor the rich on the backs of people in need? Is that who we want to be?"
• Lisa Sharon Harper from Sojourners: "It is simply unconscionable to balance the budget on the backs of struggling Americans while protecting tax breaks for millionaires. Churches and faith-based nonprofits are already fighting an uphill battle to meet the needs of their communities. They don't need politicians making their work even harder because Congress is dead set on politicizing a simple duty of common sense governance."
• Rabbi Jack Moline of the Rabbinical Assembly: "The poor are not statistics ... it is unimaginable to look in the face of a child who would go hungry without government assistance and say, 'Sorry -- we need to reduce the deficit.'"
• Rev. Gabriele Salguero of the National Latino Evangelical coalition: "Budgets reflect our deepest moral commitments. Politicians ought to remember that protecting vulnerable families and children is at the center of the biblical command to care for the poor.

Not to worry!  In order to contradict the growing economic, religious, and political voices standing up against these policies, radical conservatives are using the video instructions below as ammunition...

  Argument Rules For R & R Ticket

"The Sky is Falling" A Garry Shilling Makes For A Different Stock Predictor

Garry Shilling, predict-O-matic 'get-off-my-lawn' econowonk, recently hinted to Tech Ticker that Paul Ryan/Romney's Austerity, rape-the-poor-and-middle-class budget plans would give confidence to the marketplace and essentially increase GDP.  

Actual data examining debt yields from countries like the UK and US point destroy these austerian mythologies.  See IMF study at bottom.

 The takeaway?  ..."fiscal indicators such as deficit and debt levels appear to be weakly related to government bond yields for advanced economies with monetary independence."

There is no data to support the "market faith" theory austerians use to justify creating further market downturns through cutting government spending. 

Shilling's Market Predictions Are Telling 

When not missing economic predictions, Shilling peddles stock newsletters.  You can buy one for $275.  In, 2010 Investment Strategies: Six Areas To Buy, 11 Areas To Sell, Shilling said, "7. Sell U.S. Stocks in General."  He went on to peddle buying bonds, which was a losing proposition, along with income securities in general. 

Stock Market Climbed 9.4% In 2010!

The DOW increased 977 points for the 2010 calendar year.    Mr Shilling did say to SELL stock!  I wonder if there is a fund that takes the opposite position of stock newsletters picks?  To be considered a stock forecaster or predictor, you MUST be mostly right inside of the time frame given!

Too negative?  He is correct in saying there needs to be time for the public to de leverage from all the debt incurred the last several decades.  Without govt spending, consumers and business are paying down debt, there are no other consumers in the economy.  

De facto these right wing econowonks are creating lower GDP and lower tax revenues by cutting government spending.  This leads to more supply of labor and less demand for consumption.  Just like in Ireland debt to GDP then increases along with higher unemployment.

In short, Shilling has been calling for a double dip recession since right after the first recession.  He also is a big fan of cutting government spending KNOWING consumers are deleveraging and not fueling the economy!!!  Talk about a self fulfilling prophesy...

Resources:

The IMF [IMF Country Report No. 12/190 - Staff Report] has researched above hysterical and mythological claims about investor confidence fueling low demand economies and has another idea.  See paragraph 43. below.

43. Further slowing consolidation would likely entail the government reneging on its net debt mandate. Would this trigger an adverse market reaction? Such hypotheticals are impossible to answer definitively, but there is little evidence that it would. In particular, fiscal indicators such as deficit and debt levels appear to be weakly related to government bond yields for advanced economies with monetary independence. 

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