Author Topic: Sen. Al Franken shreds the Republican economic theory  (Read 1190 times)

Offline Reginald Hudlin

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Sen. Al Franken shreds the Republican economic theory
« on: July 18, 2011, 11:14:31 pm »

Sen. Al Franken shreds the Republican economic theory
Posted on July 14, 2011 by michaelshatz

Senator Al Franken, speaking to AFL-CIO on Monday, points out the glaringly contradictory schools of thought that define the Republican economic theory:
“So the idea that those at the very top, who now are richer than anybody has ever been; we now have people who are richer than any people have ever been in the history of the world; why they can’t pay a higher percentage of their income in taxes in crazy. Those of us in the Senate who are Democrats, we talk to people who are rich. I don’t know any of them I meet who don’t say ‘I’m willing to pay higher taxes’. I know the Republicans go to these same fundraisers and hear different things from their people, and I respect that.”

Franken goes on:
“But there is no evidence that that works. In 1993, when we had something called the Deficit Reduction Package, President Clinton said, ‘let’s raise the top two levels’ [a 2% tax increase for the top earning 1% of Americans]. Every Republican voted against it, every single one. It passed by one vote in the House and one vote in the Senate. Every Republican, well not every Republican, but every Republican who said anything said this will cause a recession.”

After taking a jab at Newt Gingrich, who said this would be the “Democrat recession”, Franken continues:
“It worked. We had the longest period of uninterrupted expansion of our economy in our history when we increased the marginal rate on the people at the top. So it worked. And not only that, but it turned a record deficit into a record surplus, which he took from one Bush, a record deficit, and turned it over to the next Bush, a record surplus.”

And then it gets interesting:
“Five days after George W. Bush became president, Alan Greenspan testified to the Senate Budget Committee, and said ‘we are in danger of paying off our national debt too fast. We have a projected $5 trillion surplus going into the next ten years and we very well may pay off the debt too fast, the federal government is in danger of having too much money.’ He said, what would happen as a result of that is, we will have to take our excess money and invest it into private equities and that could disrupt the market.”

Franken continues:
“Now I don’t get their economic theories. If you cut taxes it will automatically raise revenues. They always say that, you hear it all the time. Watch Fox sometimes, ‘every time we’ve cut taxes we’ve doubled revenues.’ That’s Sean Hannity, he says it everyday, just google it.”

Here comes the contradiction:
“Then they also tell us ‘you have to cut taxes so the government doesn’t have too much money to spend’. Reagan said it in 1981, ‘you can tell your kids all you want, not to fritter away their allowance, but the only way to do it is to cut their allowance’. He said this, you can look it up. So in other words, his thing was, you’ve got to cut taxes so you cut the revenue so their not going to spend the money. So understand, their theory is based on two mutually exclusive contradictory theories.”

So does cutting taxes double revenues or decrease them? Which is it? Franken explains:
“Every time you cut taxes, you increase revenues. And every time you cut taxes, you decrease revenues. That’s fun to hear. And then Bush of course came in and said, ‘we’re in danger of having too much money, and it’s your money so let’s cut taxes, because it’s your money. And we’re running a surplus, let’s cut taxes’.

So we cut taxes because we had “too much money”, because the economy was good. But what did Bush do when the economy soured?

“Then as soon as we started losing jobs and we’re in a recession, Bush said, ‘well we’re in a recession, we need to cut taxes because the economy’s bad.’ So in addition to ‘every time you cut taxes you increase revenue’ and ‘every time you cut taxes you decrease revenue’, there was also, ‘every time the economy’s doing well you have to cut taxes’, and ‘every time the economy is doing bad you have to cut taxes.’”

Are you starting to get the point? Because Franken has more:
“This is the most incomprehensible economic theory I’ve ever heard. And then, when it needed one more element to become absolutely dangerous, and Dick Cheney provided that. Cheney said, ‘Reagan proved that deficits don’t matter’. So Bush takes the biggest surplus in history and turns it into the biggest deficit in history, hands off a $1.2 trillion projected deficit to Obama, and an economy, here it is, I’ve done my job, we’re shedding 750,000 jobs a month.”

Franken continues:
“I can’t believe these people have actually paid any attention to anything, my colleagues. And so now we have all this money sitting on the sidelines. We did this after World War II. We invested in the right things. We invested in science and technology and education. I was a Sputnik kid. In 1957, when Sputnik was launched, I was six years-old and my brother was eleven. My parents were scared to death, because the Soviets were ahead of us in space, and they had nuclear weapons. My parents took us into our living and said, ‘boys, you are going to have to study math and science to beat the Soviets’. And I thought that was kind of a big burden to put on an eleven year-old and a six year-old. But we were obedient sons, so we studied math and science, and we beat the Soviets, my brother and me.”

Franken concludes his speech with this:
“Senate Republican leadership has said that their number one goal is to ensure that Obama is a one-term president. They didn’t say it’s to put people back to work, they didn’t say it is to get our kids educated. They didn’t even say it’s to balance the budget. They said it is to see that they win the next election. This was immediately after the last election. This is not what the American people want from us. They want us to work together. They want us to work to improve their lives. They want us to ensure that there are jobs.”

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