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Ezra Klein and Paul Ryan
|Ryan and the Republicans, of course, aren’t likely to find that logic persuasive. They don’t want more tax revenue because, well, they don’t want more tax revenue. That’s the “principle” behind their approach. So that was my question for Ryan.|
“What is the evidence,” I asked, “be it historical or academic, underneath the idea that bringing another $600 billion or $700 billion out of tax expenditures — which some Republicans, like Alan Greenspan, think is properly classified as spending anyway — what is the evidence that makes you convinced that would have such a deleterious effect on the economy that it wouldn’t be worth taking it to get the debt deal?”
“I think rates matter,” Ryan replied. “I think the statutory rate matters at the end of the day.”
“But you could have the same or lower rate there,” I said. After all, if you’re closing loopholes, the top marginal tax rate doesn’t change.
“I don’t know about that,” said Ryan. “Remember, we have to write these things statically. We don’t use macroeconomic feedback on the Joint Tax Committee.”
“But if you capped deductions at $15,000,” I pressed, “that wouldn’t change rates.”
Ryan didn’t budge. “You have to decide where you want to cap deduction or which deductions stay or go, what will pass, and what the resulting rates will be. The other problem I’ve noticed — and this is just experience from my 15 years in Congress — every time you give a little revenue, it just goes to spending. The spending cuts are always later and the revenue gets pocketed. It’s one of those fool me once, shame on you, fool me twice, shame on me.”
“The revenues — they’ve already gotten revenues. We still have not done what we need to do to get this debt and deficit under control. You cannot fix this problem through revenues. You have to fix it through real entitlement reforms. And, yes, actual spending cuts. And that stuff, Ezra, when you hear the rhetoric and see the lack of effort to tackle these things from the other side, why should we think they’ll actually put this up when all they want to do is pocket revenues and not cut spending and reform entitlements. And by the way, I think that revenue level is way too high, I don’t see how you get there.”
There's a ton more in the link.