Big Tax Cuts Will Lead to More Big Deficits

I’d favor an extension of all of Bush’s tax cuts for two years and then I’d like to see them disappear.

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Human nature being what it is, the best chance for a significant compromise between President Obama and congressional Republicans this year is over tax cuts: When asked to choose between higher taxes or fewer services and lower taxes/same services, the latter is going to win every time.

Republicans such as Sen. Jon Kyl believe, with quasireligious certitude, that tax cuts are always and everywhere the right policy. They don’t need to be “paid for”; money collected by the government belongs to the people, and any time it’s refunded, a moral good has occurred.

[See where Kyl gets his campaign money.]

Other, saner Republicans, like New Jersey Gov. Chris Christie, simply think it’s a bad idea to raise taxes before the economy has fully recovered.

I think Christie’s reasoning is sound. I’d favor an extension of all of the Bush tax cuts for two years—and then, deficit hawk that I am, I’d like to see them all disappear.

[Read the U.S. News op-ed debate: Should All the Bush-Era Tax Cuts Be Extended?]  

Make no mistake about what this means: Extending the Bush tax cuts will increase the deficit in the short term. To do so would mean that Republicans are committed, indirectly, to—gasp!—deficit spending.

Yes, darling. We are all—still—Keynesians.

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