Reports released by the Congressional Budget Office (CBO) and Moebs Services last week didn’t get nearly the level of attention of the ongoing allegations of sexual harassment/assault against GOP presidential candidate Herman Cain or Rick Perry’s mega-gaffe. Yet they are far more significant to America’s economic future because they again offer solid data kneecapping two of the key economic arguments congressional Republicans have used in their efforts to hold our economy hostage in the deficit and budget discussions.
Despite increasing evidence to the contrary, for months congressional Republicans have repeated the mantra that: 1) America has a spending problem, not a revenue problem; and 2) “regulatory uncertainty” has made American companies just too scared to create new jobs.
A report from the economic research firm Moebs Services suggests that it’s financial unease on the part of consumers and small businesses whose concerns about potential difficulty accessing their money, combined with real-time money issues, are driving economic anxiety — not government regulations or taxes on millionaires, as the GOP likes to claim. Moebs found that since the end of 2007, consumers have been moving their money out of longer-term, higher-yield interest accounts like CDs into money market and checking accounts, which are lower-yield, but allow quicker, easier access to cash. They also found that over the same period of time, the total balance in CDs has decreased by about $350 billion, while checking accounts have increased approximately $340 billion.
Now, you might think that it’s the repeated debunking of their rhetoric, combined with sinking poll numbers and an increasing lack of confidence from the American people that’s motivating the recent shift in GOP talking points on everything from Grover Norquist to revenue increases in the deficit negotiations.
Highly unlikely; in fact, I’d say the odds are less than 1 percent.
Why? Because the “proposal” congressional Republicans put forward last week continues to ignore these facts. It might sound like a step in the revenue direction, but a closer look at the details reveals a plan more likely to appease Norquist by spinning revenue raisers or “tax increases” as a reduction in itemized tax deductions, or “tax reform” without truly increasing revenues in the long run.
While they push for more cuts in social insurance programs that we pay for with our taxes — like Medicare, Medicaid and Social Security — their “revenue” is based on the condition that the Bush tax cuts are permanent. And despite the claim of decreasing overall tax rates, it actually comes at the expense of a decrease in tax rates for millionaires and billionaires, which combined with the Bush tax cuts, would actually decrease total revenue in the long run.
So once again, the data is there and the proof is in the pudding: It’s time to stop letting the GOP get away with their economic lies.
Karen Finney is a political analyst for MSNBC and Democratic consultant.