Bruce Bartlett's blog
An earler version of this appeared in The Fiscal Times.
Republicans have a problem. The American people are concerned about the budget deficit and know enough basic arithmetic to understand that it can result from higher spending or lower revenues. Republicans, however, insist that taxes must not be increased by a single penny; indeed, they argue that the government doesn’t even have a deficit problem, just a spending problem. Therefore, the only deficit reduction measures they will consider in the Republican-controlled House of Representatives are spending cuts. So certain are Republicans that tax cuts have no impact on the deficit that they included another $3 trillion worth in the budget they passed on April 15.
Democrats all know that the Republican position is ridiculous, that the Bush tax cuts have added some $2 trillion to the national debt and constitute the largest component of projected deficits going forward.
Published in The Fiscal Times on May 6, 2011
On Monday, Treasury Secretary Tim Geithner notified Congress that the public debt limit will become binding within two weeks and Treasury will no longer be able to borrow additional funds. Nevertheless, Congress is taking its time on raising the debt limit, with some lawmakers still saying they will not vote for an increase under any circumstances.
The vast majority of those commenting on raising the federal debt limit are certain that Congress will act in time to forestall a debt default, which would occur if the Treasury lacked sufficient cash to pay interest due that day or to redeem maturing securities. The smart money says that Congress could not possibly be so stupid as to permit a default and will raise the debt limit just in time.
I disagree with this view. I think there are enough members of Congress who really are that stupid. Over the last several weeks, a number of Republican congressmen have said that they will not vote to raise the debt limit under any circumstances. Some Republican senators have promised a filibuster against a debt limit increase should it pass the House. And Tea Party spokesmen have promised strenuous primary opposition for any Republican voting for a debt limit increase.
Since people seem to be taking Donald Trump seriously as a presidential candidate, it's worth remembering what he said the last time he ran for president. Following is an article I published in the Wall Street Journal that to my knowledge he never responded to. BB
November 16, 1999
Can Anyone Trump This Goofy Tax Plan?
He's joking, right?
Donald Trump says that the gross federal debt, now about $5.7 trillion, could be eliminated by imposing a one-time 14.25% tax on the net wealth of every American with more than $10 million. His political adviser, longtime Washington lobbyist Roger Stone, says this is something Mr. Trump feels strongly about, even though it would cost him $725 million personally. Mr. Stone notes that Mr.