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KRUGMAN IS A HYSTERICAL SISSY

Paul Krugman, in his usual shrill teenage girl like manner, shreeks about Paul Ryan as being evil, a liar, and a threat to all humanity on the planet. Whenever I see ultra-liberal socialists like Krugman apopletic about someone on the Republican side of the aisle, you know that the person must have some good ideas. This is the classic liberal tactic of attacking the character and intelligence of anyone who proposes non-socialist methods for saving the country from fiscal disaster. The ultra-liberal Obamanistas resort to fear mongering and class warfare bullshit. They are the reason that our fiscal crisis will never be addressed. Rather than try to figure out a way to fix our situation, they will proopose a VAT on top of our existing 58,000 page tax code. Krugman is a lying hysterical pussy Democratic shill who prefers to throw bombs rather than have a dailogue about fiscal policy. He cites the Tax Policy Center to back up all of his hissy-fit accusations. Below is the Tax Policy Center response to his tirade. They certainly do appear to be non-partisan and willing to work with both sides on a solution. I put Krugman's screeching op-ed afterward so you can see who the serious parties are in this debate.

As an added benefit, I've added quotes from Krugman regarding the deficit during the Bush administration and during the Obama administration. Who is intellectually dishonest and morally bankrupt?

TAX POLICY INSTITUTE RESPONSE:

In Defense of Congressman Paul Ryan by Ted Gayer on Fri 06 Aug 2010 01:39 PM EDT  |  Permanent Link

Given that columnist Paul Krugman relied on Tax Policy Center estimates to level claims that Congressman Paul Ryan is a “flimflam man” and that Ryan’s plan to address our fiscal problems is a “fraud,” I think a defense of the Congressman is in order.  

 

First, it is worth citing budget estimates from the Congressional Budget Office (CBO).  According to CBO, Congressman Ryan’s Roadmap for America’s Future Act would dramatically reduce the build up of America’s debt.  CBO estimates that his plan would result in a debt to gross domestic product ratio (NYSEMKT:GDP) of 69 percent in 2020, rising to 99 percent in 2040, and then decreasing to 77 percent in 2060.  This is in contrast to CBO’s estimates for its alternative fiscal scenario (which assumes a continuation of current policy) where the debt-to-GDP ratio is 87 percent in 2020, and then rises sharply to 223 percent in 2040 and 433 (!) percent in 2060. 

 

On the spending side, Congressman Ryan’s plan achieves these substantial reductions in our long-term debt through such things as progressive reductions in Social Security benefits, increases in the eligibility age for Medicare, and the replacement of Medicare benefits with a voucher starting in 2021 (with an average initial voucher value for 65-year-olds of $5,900 in 2010 dollars).

 

On the revenue side, Ryan has proposed creating an alternative income tax system that has two marginal tax rates, eliminates most deductions and credits, and exempts all interest, dividends, and capital gains from the individual income tax.  Filers would get to choose between the existing income tax and the new system.  Ryan would also replace the corporate income tax with a business consumption tax (essentially a value-added tax).

 

Krugman alleges fraud because CBO did not score the revenue side of the Congressman’s plan.  (This is correct as the Joint Committee on Taxation is responsible for providing the official revenue score of tax legislation.)  Instead, CBO assumed that total federal tax revenues will be equal to “those under CBO’s alternative fiscal scenario … until they reach 19 percent of gross domestic product in 2030, and to remain at that share of GDP thereafter.”  Contrary to Krugman’s claims, this assumption is not unjustified.  Ryan has explicitly stated that he is willing to work with the Treasury department to adjust the rates on his tax reform plan to “maintain approximately our historic levels of revenue as a share of GDP.”  Since 1980 the federal tax revenue has been about 18 percent of GDP.

 

TPC did analyze Ryan’s tax-specific proposals and found they would fall short of this revenue goal.  For example, Ryan’s proposal would lead to federal tax revenue of approximately 16 percent of GDP, which amounts to a $4 trillion revenue shortfall over ten years compared to the alternative fiscal scenario.  But that doesn’t mean that Ryan’s plan is a fraud. Instead, it shows that Ryan’s vision of broad-based tax reform, which essentially would shift us toward a consumption tax, needs to be adjusted in order to meet his stated goal of matching historical levels of revenue as a proportion of GDP.  This indeed poses a challenge to Congressman Ryan to make specific changes to his tax reform plan in order to meet his revenue goal.  Reasonable people can disagree about whether we should close our long-term fiscal gap primarily through spending reductions or tax increases, but Congressman Ryan’s proposal makes a useful contribution to this debate.

 

The Flimflam Man
By PAUL KRUGMAN
Published: August 5, 2010

One depressing aspect of American politics is the susceptibility of the political and media establishment to charlatans. You might have thought, given past experience, that D.C. insiders would be on their guard against conservatives with grandiose plans. But no: as long as someone on the right claims to have bold new proposals, he’s hailed as an innovative thinker. And nobody checks his arithmetic.

 

Which brings me to the innovative thinker du jour: Representative Paul Ryan of Wisconsin.

Mr. Ryan has become the Republican Party’s poster child for new ideas thanks to his “Roadmap for America’s Future,” a plan for a major overhaul of federal spending and taxes. News media coverage has been overwhelmingly favorable; on Monday, The Washington Post put a glowing profile of Mr. Ryan on its front page, portraying him as the G.O.P.’s fiscal conscience. He’s often described with phrases like “intellectually audacious.”

But it’s the audacity of dopes. Mr. Ryan isn’t offering fresh food for thought; he’s serving up leftovers from the 1990s, drenched in flimflam sauce.

Mr. Ryan’s plan calls for steep cuts in both spending and taxes. He’d have you believe that the combined effect would be much lower budget deficits, and, according to that Washington Post report, he speaks about deficits “in apocalyptic terms.” And The Post also tells us that his plan would, indeed, sharply reduce the flow of red ink: “The Congressional Budget Office has estimated that Rep. Paul Ryan’s plan would cut the budget deficit in half by 2020.”

But the budget office has done no such thing. At Mr. Ryan’s request, it produced an estimate of the budget effects of his proposed spending cuts — period. It didn’t address the revenue losses from his tax cuts.

The nonpartisan Tax Policy Center has, however, stepped into the breach. Its numbers indicate that the Ryan plan would reduce revenue by almost $4 trillion over the next decade. If you add these revenue losses to the numbers The Post cites, you get a much larger deficit in 2020, roughly $1.3 trillion.

And that’s about the same as the budget office’s estimate of the 2020 deficit under the Obama administration’s plans. That is, Mr. Ryan may speak about the deficit in apocalyptic terms, but even if you believe that his proposed spending cuts are feasible — which you shouldn’t — the Roadmap wouldn’t reduce the deficit. All it would do is cut benefits for the middle class while slashing taxes on the rich.

And I do mean slash. The Tax Policy Center finds that the Ryan plan would cut taxes on the richest 1 percent of the population in half, giving them 117 percent of the plan’s total tax cuts. That’s not a misprint. Even as it slashed taxes at the top, the plan would raise taxes for 95 percent of the population.

Finally, let’s talk about those spending cuts. In its first decade, most of the alleged savings in the Ryan plan come from assuming zero dollar growth in domestic discretionary spending, which includes everything from energy policy to education to the court system. This would amount to a 25 percent cut once you adjust for inflation and population growth. How would such a severe cut be achieved? What specific programs would be slashed? Mr. Ryan doesn’t say.

After 2020, the main alleged saving would come from sharp cuts in Medicare, achieved by dismantling Medicare as we know it, and instead giving seniors vouchers and telling them to buy their own insurance. Does this sound familiar? It should. It’s the same plan Newt Gingrich tried to sell in 1995.

And we already know, from experience with the Medicare Advantage program, that a voucher system would have higher, not lower, costs than our current system. The only way the Ryan plan could save money would be by making those vouchers too small to pay for adequate coverage. Wealthy older Americans would be able to supplement their vouchers, and get the care they need; everyone else would be out in the cold.

In practice, that probably wouldn’t happen: older Americans would be outraged — and they vote. But this means that the supposed budget savings from the Ryan plan are a sham.

So why have so many in Washington, especially in the news media, been taken in by this flimflam? It’s not just inability to do the math, although that’s part of it. There’s also the unwillingness of self-styled centrists to face up to the realities of the modern Republican Party; they want to pretend, in the teeth of overwhelming evidence, that there are still people in the G.O.P. making sense. And last but not least, there’s deference to power — the G.O.P. is a resurgent political force, so one mustn’t point out that its intellectual heroes have no clothes.

But they don’t. The Ryan plan is a fraud that makes no useful contribution to the debate over America’s fiscal future.

 

KRUGMAN - THE INTELLECTUALLY DISHONEST, MORALLY BANKRUPT, SNIVELING PUSSY:

“We have a world-class budget deficit,” he said, “not just as in absolute terms, of course — it’s the biggest budget deficit in the history of the world — but it’s a budget deficit that, as a share of GDP, is right up there. Krugman called the deficit “comparable to the worst we’ve ever seen in this country. … The only time postwar that the United States has had anything like these deficits is the middle Reagan years, and that was with unemployment close to 10 percent.” Take away the Social Security surplus spent by the government, he said, and “we’re running at a deficit of more than 6 percent of GDP, and that is unprecedented.” “We have the huge bulge in the population that starts to collect benefits. … If there isn’t a clear path towards fiscal sanity well before (the next decade), then I think the financial markets are going to say, ‘Well, gee, where is this going?’” If we don’t get our “financial house in order,” he said, “I think we’re looking for a collapse of confidence some time in the not-too-distant future.”

THE GREAT KRUGMAN – NOVEMBER 2004 (Deficit of $400 billion – 3.5% of GDP)

“These days it’s hard to pick up a newspaper or turn on a news program without encountering stern warnings about the federal budget deficit. The deficit threatens economic recovery, we’re told; it puts American economic stability at risk; it will undermine our influence in the world. These claims generally aren’t stated as opinions, as views held by some analysts but disputed by others. Instead, they’re reported as if they were facts, plain and simple.” He continues, “And fear-mongering on the deficit may end up doing as much harm as the fear-mongering on weapons of mass destruction.” “There’s no reason to panic about budget prospects for the next few years, or even for the next decade.”

THE GREAT DOUCHEBAG – 2010