Wednesday, March 13, 2013

Two More Notes on Imaginary Numbers

Two more quick notes on the Ryan budget's tax numbers:

1. I said yesterday that what's real about the budget as a whole is that it's an opening bid for further negotiations. That might be wrong. The other possibility, as Ed Kilgore says, is that it's simply a gift to the crazies in exchange for not blocking the debt limit increase last time around -- and perhaps the next time, too.  Could be!

2. The implausibility of the tax numbers is drawing a lot of attention. But on second thought, I'm not sure that's fair, or at least necessary. This is a budget, not a tax reform plan. As long as the tax cuts proposed in the budget are only intended -- and will only be implemented -- as part of revenue-neutral comprehensive tax reform, then who cares (from a budget point of view) whether it's going to be possible to come up with enough offsets to make it work? If it doesn't, then (presumably) tax policy just reverts to the status quo.

So perhaps what people need to know about Ryan and the House Republicans is (1) whether they'll use real numbers in their projections -- which it appears so far that they are -- and (2) are all the tax cuts mentioned in the budget contingent on revenue-neutral tax reform, or only the tax rate cuts? As long as the answers tell us that we can trust that their plans should get to the overall revenue estimates, then I'm not sure how much it matters that what they're promising for tax reform is entirely implausible.


  1. Or one can just look at what has happened in the past 32 years and safely assume tax rate cuts will not be offset by Republicans.

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