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Higher Taxes Can’t Eliminate The Deficit

Somehow we almost missed this startling admission from the the radical left Tax Policy Center, from back in January:

Desperately Seeking Revenue

Author(s):  Rosanne Altshuler, Katherine Lim, Roberton Williams

January 29, 2010

Abstract

In August 2009, the Congressional Budget Office (CBO) projected that the federal budget deficit would total $7.1 trillion over the 2010-2019 decade-under current law. That outcome would require the 2001 and 2003 tax cuts to sunset as scheduled in 2011 and Congress to stop "patching" the alternative minimum tax to minimize its bite. If neither of those things happens, CBO says the cumulative deficit over the decade would jump to $11.1 trillion, more than doubling the national debt. Our economy cannot sustain that rate of debt increase. How can we reverse it?

This paper poses a simple question: could incremental reforms of the current tax system raise enough revenue to reduce the deficit to an average of 2 percent of GDP over the last five years of the budget window? We use the Urban-Brookings Tax Policy Center Tax Model to simulate several revenue-raising tax changes, including raising all income tax rates proportionally, hiking taxes only for high-income taxpayers, and either limiting or eliminating itemized deductions to broaden the tax base.

We conclude that politically feasible tax increases within the current tax structure cannot generate sufficient revenues to bring federal budget deficits under control

Roberton Williams is a senior fellow of the Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution. Rosanne Altshuler is the center’s director.

The full report is available here (a pdf file).

Elsewhere, the Tax Policy Center sums up their findings thusly:

Myth: Higher taxes could eliminate the federal deficit

Washington spends more than it takes in through tax revenues, resulting in a projected budget deficit of almost $1.35 trillion in 2010, or 9 percent of GDP, according to the Congressional Budget Office. Couldn’t we get rid of the deficit by raising taxes?

No. A study we conducted at the Tax Policy Center found that Washington would have to raise taxes by almost 40 percent to reduce — not eliminate, just reduce — the deficit to 3 percent of our GDP, the 2015 goal the Obama administration set in its 2011 budget. That tax boost would mean the lowest income tax rate would jump from 10 to nearly 14 percent, and the top rate from 35 to 48 percent.

What if we raised taxes only on families with couples making more than $250,000 a year and on individuals making more than $200,000? The top two income tax rates would have to more than double, with the top rate hitting almost 77 percent, to get the deficit down to 3 percent of GDP. Such dramatic tax increases are politically untenable and still wouldn’t come close to eliminating the deficit

And this isn’t from some fiscally conservative think tank. It is from the Democrats at the hard left Brookings Institute and the radical left Urban Institute.

From Discover The Networks:

Brookings Institution

Brookings has been involved with a variety of internationalist and state-sponsored programs, including the Global Governance Initiative, which aspires to facilitate the establishment of a U.N.-dominated world government, based in part on economic and Third World considerations. Brookings Fellows have also called for additional global collaboration on trade and banking; the expansion of the Kyoto Protocol; and nationalized health insurance for children. Nine Brookings economists signed a petition opposing President Bush’s tax cuts in 2003

And the Urban Institute is even more far left Democrat Party organ. Again from Discover The Networks:

Urban Institute

In 1980, UI called for socialized health care in the United States, and in 1982 began a running critique of the Reagan Administration under its Changing Domestic Priorities Project; the critique ran to 26 volumes, with research paid for by the Ford Foundation…

In 2001, UI and the Brookings Institution began collaboration on a Tax Policy Center (TPC) to discredit President George W. Bush’s tax cut plans, which UI claimed disproportionately and unjustly favored "the wealthy."

And, mind you, this TPC study was written even before Mr. Obama got his ‘healthcare reform.’ Which is the greatest entitlement increase since the start of the ‘Great Society.’

An entitlement that both Brookings and the Urban Institute propagandized for relentlessly.

This article was posted by Steve Gilbert on Tuesday, April 6th, 2010. Comments are currently closed.

13 Responses to “Higher Taxes Can’t Eliminate The Deficit”

  1. AcornsRNutz

    THis is coming from a “think tank?” Good Lord. What they are saying, if I am reading this right, is that if I am selling bread at 500 bucks to my most frequent customers and giving it away to others, and my business is failing, I can’t save my business by charging 1000? Hmm that is odd.

  2. proreason

    It had to come to this. Why God gave us Barack Obama.

    We are in the midst of the third seminal event in US history. First came the American Revolution and then the Civil War. They created our country. The third will re-create it for another hundred years.

    Even before the appearance of the cartoonish Barack Obama, this country was on the road to doom. Republicans had long ago repudiated Ronald Reagan and given in to creeping socialism. Everyone knew that entitlements were bankrupting the country and sapping its creative energies. The dependent class grew unchecked. But the feeble Republican response to the grasping Leftists was more massive entitlement programs, supposedly using free market principles, as debt piled on debt. It was as if the 7th graders were running in lockstep to the auditorium doors to show the 4th graders that their mad dash was undignified.

    Doom was 20 years, 10 years, 5 years away. Take your pick. The lobster was boiling and it was us.

    But God gave us Barack Obama.

    He is a caricature of everything this country opposes. A smirking Marxist, boastful of his ignorance of our traditions, childishly determined to cram failed European socialism down the throats of the country, no matter the opposition to it. His allies are Dick Tracy cutouts. A mob of mumbling racists conjecturing hate crimes from thin air; spending our children’s inheritances as they run to roulette wheels to stuff their pockets with our money; their preening press sycophants sneering at adults who ask why, no distortions too grotesque to be foisted as truth; their low-IQ leaders reveling in their power, openly contemptuous of the people who oppose them, openly abandoning the subterfuges of the past.

    So now we know. We are awake. Another ten years of boiling water would have been enough, but now we can see it. We do see it.

    The die is set. The cartoon Marxists are doomed. America will be rebuilt.

    Barack Obama, the reverse George Washington, is saving us.

    To the polls in November.

    • BillK

      OK, take a look around the country.

      What, precisely, of what you see makes you believe that the people will “rise up” and take action in November?

      The coasts and media outlets continue to believe Barry isn’t doing enough and his canonization continues.

      The characterization of anyone to the right of Chairman Mao as somehow dangerous who must be watched continues.

      Meanwhile, Americans want their Free Candy and aren’t going to vote out someone who gives it to them.

      Note that even were Republicans to sweep both houses somehow, they would never have the guts to actually act. Not when they were portrayed as racist haters. We’ve seen that time and time again.

      Not like it would make a difference when Barry would continue to act by dictat and tell our enemies they need not worry about retaliation from the U.S. even if they cover the country with nerve gas.

      No, there’s no route out of this one, like it or not, at least until 2012, and let’s face it, likely not even then.

      We’re upset, but most of the American electorate cares more about the latest in Sandra Bullock’s potential divorce than about anything Barry or Congress say or do.

    • proreason

      There’s no hope BillK.

      You should probably commit suicide.

      By the way, how did that Scott Brown prediction of yours pan out. You said there was no way he would win. Somehow, the dems would steal the election.

    • BillK

      But what did Brown’s winning change?

      The Democrats no longer have a supermajority but what difference did it make regarding Health Care?

      It’s far too naive to believe that November will make a difference at this point, especially given how far away it still is.

      Not to mention that even if every Democrat lost, Obama would still be President, the Democrats would still hold a majority in the Senate, and Republicans would actually have to show the willingness to cut spending and otherwise stand by their principles.

      That’s a lot of ifs where if the MSM continues their brainwashing the public will be convinced that Obama “fixed the economy” by then.

      If not having a rational Government in place made me suicidal, I would have pulled the trigger as soon as Republicans started to throw away their standards back in 1995.

    • proreason

      Oh I see.

      You weren’t wrong in that pessimistic prediction.

      The sun didn’t pop out and shine forever, so your gloom and doom prediction was correct.

      Others might say that the election of Scott Brown was a great victory and a powerful indication that the mood of the country has changed significantly since Nov 2008. But you are sticking to gloom, no matter what.

      On this matter, you remind me of liberals, BillK. You’ve got the answer and you’re sticking with it.

      Of course, I agree with you much of the time and I think you are a clever and entertaining poster, but you are doing youself a disservice by refusting to acknowlege the positive signs in the surge of the Tea Party activists.

  3. bousquem

    “The top two income tax rates would have to more than double, with the top rate hitting almost 77 percent, to get the deficit down to 3 percent of GDP. Such dramatic tax increases are politically untenable and still wouldn’t come close to eliminating the deficit…”

    It will be politically done with the left just steamrolling laws that give them complete control forever and making the USSA. Then all money over a set amount will belong to the goverment unless you are part of the chosen group in the cabal that have all your taxes waived but donate nothing to charity.

  4. canary

    Obama, himself wrote in 2006 that there was NO money to implement a national or universal health care plan, because Bush spent so much on war and reduced taxes. Furthermore he wrote he did NOT have the answers on a health care plan, just some ideas. Even Hillary Clinton knew we couldn’t afford the health care plan, but had to play the game to win voters. No one then, Repubican or Democrat, least of all the media that controls the world,
    called Obama on the carpet. During the heated health care bill, no one brought this up.
    Half the country who didn’t take time to actually listen to Obama, yet alone how clear he made it in his inaugural Universal health care for all, did not mean free health care for all. But, half the country really believe he meant free.
    And already Obama is defending & laughing at Americans in his speeches with his “it’s only been passed for 1 week, now. folks. It’s just been 1 week, give it some time.
    At a speech the other day Obama had a question why he would raise taxes during such a terrible time with people losing jobs. Obama took 17 minutes!
    to duh, ah, uh..answer the question, interrupting his ownself several times to apologize to the people for taking so long to answer the question, and the only words that stuck to my mind was when he said National health care will be like Walmart stores! Everyone shops at Walmart to save, and everyone will want national health care instead of other insurance plans. But, I don’t think the people understood even that. But, having heard rumors a few years ago, from a Walmart worker they were going to have medical clinics. It’s been years and so far it hasn’t happened.

    People can say all they want that the tea-parties aren’t effective. The media has intentionally downsized the number who attend. The media has intentionally lied that these are radical & scary people, even the tea parties that are so peaceful you don’t see a police-officers standing by in crowds of thousands.
    What you don’t see are the millions & millions that support the tea parties, but don’t go. Transportation, work, health, for whatever reasons.
    Can you imagine if people had the financial means to attend that Washington D.C. tea-party it would have been the largest crowd ever in U.S. history.
    It’s possible some hostility might start creeping in, and the liberals are going to do everything to goat, and stir anger from the conservatives so they can pass more laws. Obama wrote sometimes the liberals need to “let off steam”, but we know that right only belongs to a minority of the Obama regime.

    Obama is working no different than how Hitler worked. Just not as free to order all the old people be gassed and cremated. Then order all the Christians into work camps til they drop dead.

    And the bible doesn’t say the earth will end. It just says things will get very bad as we are seeing. But, in the end God will restore the earth, so there is a great future ahead. The bible says during this tribulation people will be saved from every nation. Man was given free will. And while we are at our weakest God can become the strongest. I think He wants people to understand how strong he is, and that men such as Obama are simply powerless, next to Him.

  5. U NO HOO

    Someone said that to take over 16 percent of the economy is equivalent to a 16 percent tax rate on income.

    If half don’t pay income tax that is 32 percent on the rest. If the tax is linearly progressive that is 64 percent on the rich. Just for health care.

    Anyone with a brain think that will work? It means we are back to pre Reagan. And i dont got no economics degree.

  6. Mithrandir

    Do you know that the federal obligations to health care, retirement benefits, and other liabilities is in the 100s of TRILLIONS of dollars?

    Do you know the real cost of the loss of the great recession with poor investing, derivatives market is over A QUADRILLION dollars

    Don’t worry, we are BEYOND bankrupt, and no amount of tax money will fix it. We will have to pretend it is not this way, to preserve the fabric of society as long as possible. But we are hopelessly broke ~ don’t kid yourself. ….And keep an eye on those FEMA detention camps, they weren’t built just to beautify the scenery.

  7. Reality Bytes

    Even a box of rocks knows you can’t get blood from a stone.

  8. FlakMusic

    Hey the “Elsewhere” link no longer works: http://tinyurl.com/yccfwzt

    Can anyone else find the page at TPC where that summary is quoted?




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