Arguing about taxes
One reason to have a blog is so you can follow up frustrating TV debates with facts that were abused in the segment. I was arguing with a couple of CEOs on Larry Kudlow鈥檚 show last night on CNBC about why the stock market tanked today. They said it was a failure of leadership, I said it was a failure of growth.
Neither side convinced the other (I鈥檒l get the link up tomorrow).
But here鈥檚 mistake they made: the CEOs argued that a) President Obama鈥檚 plan raised too much in tax revenue, and b) Bowles/Simpson plan was much better and Obama made a big mistake not adopting it.
What I kept trying to tell them鈥攁nd all three, including Larry the K got this wrong鈥攚as that Bowles/Simpson raises more revenue than Obama.
In fairness, it鈥檚 an easy mistake to make. As shown in their Table 3 , Bowles/Simpson raises about $1 trillion in new revenue. But that鈥檚 above the revenue you get from allowing the highend Bush tax cuts to sunset, which, unlike the President, they assume in their baseline. Adding those revenues back in, and updating to be comparable with the President鈥檚 proposal, gets B/S up to about $2 trillion, as shown in Table 4 from the Committee for a Responsible Budget.
The President鈥檚 plan counts the highend Bush revenues in its $1.5 trillion total. So B/S raise about half a trillion more in revenue than the President.
If you want to make sense, you can鈥檛 critique the President for both raising too much revenue in his plan and not enacting Bowles/Simpson. If you don鈥檛 want to make sense, well鈥hen you can say anything.
