Lower taxes
Republicans want to lower taxes, natch. And here they use numbers – three numbers, to be exact. They propose a “simple and fair tax code” with a 10% marginal tax rate on incomes up to $100,000 and 25% thereafter, with generous standard deductions and personal exemptions.
And what will be the revenue effects of this approach? They don’t say.
They propose to fix the AMT, reduce the capital gains tax, and “loosen restrictions on various savings vehicles”, presumably so that people wishing to double down on stupid can invest what’s left of their depleted retirement savings in the stock market.
Drill, baby, drill
Republicans want to keep energy and fuel cost low. They way to do that, they suggest, is to allow drilling offshore and in the Arctic Coastal Plain with a portion of federal royalties going to a Renewable Energy Trust Fund. They also want to short-circuit legal challenges to their energy development initiatives.
They plan to boost nuclear power generation and “promote the development of renewable and alternative energy.” One of the alternative energy sources they want to develop is oil shale, which they propose extracting from federal land.
End the bailouts; sayonara, CRA
Republicans want to end bailouts and reform the financial system. With eagle eyes they keenly observe that, “the best antidote for market turmoil is certainty and economic growth.” It’s hard to fool these guys; they know that certainty is the antidote for uncertainty. The reverse is probably true too.
Republicans would put insolvent financial institutions into “temporary receivership,” to be restructured by an RTC-type agency; and privatize GSEs like Fannie Mae and Freddie Mac.
That’s not all. Republicans want to modify any federal law – including CRA – that encourages lending to high-risk individuals, “to clarify that lending standards should not be compromised to meet political goals.” Apparently it is okay to compromise poor neighborhoods to meet political goals, though.
Bring back Reaganomics
Last, Republicans want to keep the cost of living low by encouraging the Fed to focus on “long-term price stability” rather than “short-term economic growth,” and by amending the Humphrey-Hawkins Full Employment Act. Think of it as Reaganomics Redux; if you liked supply-side economics, you will love this approach.
“The Republican Road to Recovery” says nothing about education, national security, immigration reform, the war on terror, foreign aid, international diplomacy, or many of the other topics that have dominated the national conversation for the last eight years. But maybe I expect too much: it’s only a budget.
Not only is “The Republican Road to Recovery” not a budget, it is not even a thoughtful or responsible starting point for discussing a budget. Instead, it is a sophomoric, thoughtless, and ultimately pointless response to the President’s challenge. It is rife with the same kinds of partisan platitudes, generalities, and non-solutions that created the present mess.
Smaller government … tax cuts … entitlement reforms … offshore and ANWR drilling … less regulation … a return to supply-side economics … those are among the Republicans’ fresh new ideas for the 21st century. “Old wine in new bottles.”
