One might think that the chair of the Federal Reserve Bank would have some fairly clear views on the degree to which borrowing should be used to permit tax cuts that mostly benefit the wealthy. Citizens for Tax Justice found some interesting hemming and hawing in recent testimony by Bernanke in the Senate. Senator Jack Reed seeks to pin Ben Bernanke down on his views regarding the "paygo" concept that requires tax cuts to be financed by spending reductions and spending increases to be financed by either spending cuts elsewhere or tax increases. Bernanke managed to answer the questions in very roundabout fashion, but essentially he seems to have said that while there are some exceptions, paygo is really the best way to go. Read the report here.
It is clear that the 2001-2004 tax cuts have not "paid for themselves" in revenue increases. Do we really want to continue borrowing from China, Japan and the UK to pay for tax cuts that primarily benefit big corporations and wealthy investors? It is time for the Congress to rethink the question of making those costly tax cuts permanent.
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