Wednesday, March 13, 2013

Yglesias vs. Ryan

Following the unveiling of Paul Ryan's latest budget, Matt Yglesias wasted little time reacting by rattling off a series of blog posts which provide a useful window into the leftist mindset. In his first post on the subject Yglesias accused Ryan of no less than "class war on behalf of the rich" and launching a "campaign of thoroughgoing class warfare aimed at Americans in the bottom half of the income distribution in order to protect the interests of a small, high-income minority." Well!

What prompts Yglesias to level such an accusation? Mostly the fact that Ryan would cut the top income tax bracket to 25 percent, implement tax reform that would probably result in higher taxes for those with incomes under $100,000 per year and cuts to some government programs. 

But so what? Let's recall the current state of play:

The rich are bearing a hugely disproportionate share of the income tax burden, and thus disproportionately fund the very government programs that Ryan has proposed be cut (mind you that overall federal spending will continue to grow at a 3.4 percent clip under Ryan's budget). In other words, under Ryan's budget those with higher incomes will be punished less and those with lower incomes will be given fewer government goodies while paying more for those they do receive. Unless Yglesias can produce evidence that Ryan's budget will produce a situation in which the rich will be consuming more government goodies than what they pay in, or even that their contributions will be less than their percentage of national income, the charge is baseless.

Furthermore, there is no moral equivalence between one person being forced to give up what they have earned and another person being given less of what was taken from others. 

In his subsequent post, Yglesias impugns the very motives behind Ryan's budget proposal:
Something that makes Paul Ryan an interesting figure in my view is that along with his passion for reducing the living standards of the poor in order to bolster the incomes of the wealthy, he maintains a sideline interest in monetary policy.
Notice how Yglesias refuses to entertain the possibility that Ryan's budget is aimed at bringing about prosperity that would ultimately help the poor (the budget's very name of "Path to Prosperity" would seem to suggest Ryan's intentions), but rather implicitly sees hurting the poor while helping the rich as a chief goal (Ryan's "passion"). Stay classy, Matt.

In his last post on the subject, Yglesias wonders about Ryan's tax cut tactics:
If you're going to be the party of tax cuts, then you have to have a tax-cut plan that cuts most people's taxes. Ryan's plan is going to lead to tax increases for a broad swathe of middle-class Americans and do absolutely nothing for low-wage workers.
Except -- and Yglesias is too well-informed not to know this -- well over 40 percent of Americans do not pay federal income tax. How can Ryan or anyone else cut taxes for those who don't pay income tax in the first place? One possible way, of course, would be to reduce the payroll taxes that help fund Medicare and Social Security. Given that one of the major questions before lawmakers is how to fund both programs in coming decades given their projected revenue shortfalls, this is unfeasible in the extreme. 

One almost has to applaud the left for their strategery on the tax issue. The tax code is now sufficiently progressive -- more so than what one finds in much of Europe, where heavy taxation is borne by a broad swathe of the population rather than a relative few -- that it is nearly impossible to offer a tax cut of any significance that is not overly tilted towards the rich given that they are the ones who pay so much of the tax. Mission accomplished.

No comments: