Monday, as the House and Senate groped toward reconciling their terrible tax cuts for the super-rich and corporations, MSNBC’s Ali Velshi and Stephanie Ruhle did some excellent taxsplaining on the perfectly dishonest economic assumptions behind the plan. First, Ali Velshi offered a brief review of the research on a central basic question: Do tax cuts for the rich stimulate economic growth? Heck no!
There have been huge changes made to our tax code throughout US history, yet we’ve seen no observable shift to long-term growth rates in the last 150 years, which have hovered at an average rate of between 1.8 and two percent growth per year.
He also called attention to a recent survey by the University of Chicago’s Booth School of Business — hardly the home of a bunch of wild-eyed Marxists — in which not a single one of 42 top economists thought the GOP tax bill would result in higher growth over the next decade. (They did agree — with high certainty — that we’d end up with a much higher debt-to-GDP ratio.) On top of that, Velshi noted that Goldman Sachs — again, folks who are totally into big profits — just released an analysis predicting only a short-term uptick in economic growth, a whopping three-tenths of a percent rise, followed by a leveling off after two years, and by 2020, flat or even declining growth. Sorry, the jobs won’t all come back from China. But investors will be happy to reap the (extra, extra) profits, hooray!
Velshi wasn’t having it, pointing out the four studies he’d just cited from think tanks saying, no, this is not going to create an explosion of growth. Stewart tried to accuse Velshi of cherry-picking his analyses, but Velshi just asked, “Goldman Sachs? The Tax Foundation, the Wharton School…?” All nice choices, especially given the “president’s” unrequited love for his alma mater.as we’ve noted, this tax bill is the least popular in 40 years.
By the end of the interview, Stewart was reduced to trying to defend “trickle-down” economics, which didn’t go well at all. When Ruhle and Velshi pointed out that corporate America is not having any problems with investments and profits, and that the tax savings wouldn’t go into creating jobs (which come from consumer demand, not from having another sack of money), Stewart grasped blindly for the idea that even if the tax cuts mostly go to dividends for stock shareholders, then that will somehow create jobs, because those higher dividends will go to ordinary folks. Who, unfortunately for Stewart’s argument, don’t actually own stock. That’s a rich kids’ game.
This is how an interview should be conducted: Ruhle and Velshi don’t badger Stewart with slogans or insults; they’ve done their homework and hit him right in the fact-bag. Now, if only more cable news people actually had the smarts and motivation to do that homework. And Yr Dok Zoom has some homework for you, Wonkers: Inform your own discussions of supply-side fakery with this excellent 2012 Congressional Research Service analysis which found that since 1945, there’s little evidence to suggest that lower taxes on the top income brackets result in better economic growth. Get wonking, you.