President Obama on the Economy

The President on the state of the economy, with some hard shots at the Republicans. Obviously there are pretty severe disagreements, but lets look at some of the key points.

1) Should there be tax breaks for companies that ship jobs overseas?

2) Should the Bush era tax cuts be extended? If so should the top wage brackets be included? If yes please explain the impact on the deficit.

The attack on the Republican Pledge comes from the right as well. From Erik Erikson over at the “Red State” blog.

The plan wants to put “government on the path to a balanced budget” without doing anything substantive. There is a promise to “immediately reduce spending” by cutting off stimulus funds. Wow. Exciting.

There is a plan to cut Congress’s budget, which is pretty much what was promised in 1994. Seriously? In 4 years did the Democrats really blow up the Congressional budget? No — the GOP did that too.

There is no call for a Spending Limitation Amendment or a Balanced Budget Amendment. It is just meaningless stuff the Democrats can easily undo and that ultimately the Senate GOP will even turn its nose up at.

My earlier post only dealt with the deficit as an issue with the Republican Pledge, and I continue on that track here. Erikson states the obvious. The Republican “Pledge” speaks in platitudes on the deficit, but offers nothing that would actually reduce the deficit. The Tea Party folks know Republican nonsense when they hear it, and the Pledge, in terms of deficit reduction, is hokey. The Republican leadership in Washington, in their heart of hearts, believes the same thing that Dick Cheney believes. Deficits don’t matter! Especially when it comes to tax cuts.

Richard Nixon famously said that “We are all Keynesians now.” And the Republican plans are based on priming the pump through deficit spending via the tax cut model. I like to highlight their hypocrisy on the deficit because the Washington Republicans have been so vocal in their criticism of the Obama Administration for priming the pump through the stimulus program. But their economic model, while vastly different in key respects, is really the same when it comes to the deficit. Which really makes their criticism on deficits nonsensical.

Democrats have their own issues on this subject, and they too will run from the necessary reforms once the Presidential Deficit Commission reports its findings. But for now it is the Republicans making bold claims without being able to even slightly back them up.

Read the Erikson blog post here.

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