I suppose with all the wars Republicans have going on, such as the war on terror, war on drugs, war on illegal immigration, war on crime, war on gay marriage, war on abortion, war on the environment, war on science, war on education, war on health care, and many others, it should come as no surprise they have been fighting a war on economics since the Reagan era. As successful as Reaganomics has been in widening the gap between rich and poor, skewing the distribution of wealth further into the hands of the few, putting increased burden on the middle class while expecting them to go into debt to consume even more to hold up the economy, stacking up nearly insurmountable federal debt, mortgaging the country with tax cuts for the rich that are eventually paid for by everyone else, making more and more corporate welfare available to poorly run businesses, and making sure that those who have benefited most from the commonwealth don’t have to give anything back so they can pass it on to their spoiled brat
children who don’t need it in the first place, there isn’t any reason to stop now!
So, you ask, “what exactly is this war on economics you’re taking about and how do I join the fight?” Well, a perfect, timely example of this is John McCain‘s proposed fuel “tax holiday” with the presumed goal of stimulating the economy while taking some of the bite out of high gas prices. Right. Let’s take a closer look at this proposed legislation, shall we?
The idea is this: we’ve got this giant sucking sound out of people’s wallets with $4 per gallon gasoline, particularly hurting the average, red blooded, good, hard working, god-fearing ‘murican who is driving a 4 ton land yacht. Compounding the issue for this good, middle class ‘murican, is that he (she of course is a stay at home mom, cleaning the floors and putting dinner on the table) lives three states away from work and has to commute for 4 hours each way, giving him even more time to listen to angry, sex-deprived, white men like himself rant on “talk” radio about the fact that it takes so much money to fill up their land yachts and how it’s all the fault of illegal immigrants and communist liberals (especially given the audacity of said latte drinkers to demand things like safety belts, catalytic converters, and bumpers!). They want relief damn it (I’m not talking about from their enlarged prostate here either)!! So, what better than to put a moratorium on federal taxes on gasoline, which amounts to $0.184 per gallon for passenger vehicles and $0.24 per gallon for trucks (the real kind that hauls freight, not your neighbor’s gilded Cataract Escapade).
To see the wisdom of this wonderful idea, let’s first determine what useless entitlements these federal taxes fund. The proceeds go into the highway trust fund to fund infrastructure such as highways, levees, and bridges, which we all know are in completely perfect shape; perfectly omnipotent market forces or the sins of residents of course explain things like Katrina and the Minneapolis bridge collapse, so why waste money on those things? Since we’re in agreement that the US Government has no business interfering in free markets by working on roads and the like, let’s go ahead and see what economic benefits are derived from this wonderful tax holiday.
The first awesome benefit to be derived from the tax holiday is to make refiners and oil companies richer! This is perfect and in accordance with Reaganomics (who undoubtedly is looking down from Peter’s right shoulder and uttering, “it is good.”). How does this ingenious plan accomplish this, you ask. In several ways. First, Americans drive more during the period in which the holiday would be in effect (i.e., summer), creating more demand. Refining capacity is a constant, constricting supply, resulting in increased prices at the pump. Second, a tax holiday may in fact spur good, flag lapel pin wearing ‘muricans into patriotically driving their land yachts rather than other means of travel (or staying home). This increases the demand for gasoline even more, escalating prices. So the net effect is that in all likelihood has prices at the pump would climb back to what they were pre-tax holiday, and adding the difference straight to oil refinery‘s profits. Brilliant!
The next economic benefit is to further mortgage the country since the revenue lost from the tax (not to fund silly entitlements like highway improvements, construction jobs or clean air, but more important things like invading more sovereign nations not run by angry white Christian men) would have to be added to the deficit, likely resulting in the shortfall being borrowed from foreign investors. We can just add this to shortfalls from things like the sub-prime mortgage success, which resulting from eliminating pesky government interference of predatory lending practices (a perfectly moral thing in a free market, right?).
“Wait a minute!” you say. “What about a windfall profit tax excised on oil companies to make up the shortfall?” This was proposed by Hillary Clinton (McBush presumably taking money instead from welfare earmarks such as education and healthcare). This is a great idea! In fact, it falls in perfectly with the other economic benefits listed above. Ronald Reagan, if alive, might leap for joy and secretly vote for Hillary in fact. Companies who will derive no marginal benefit from increased sales due to a windfall tax will of course further restrict supply to result in the optimum mix of revenue/profits such that they would yield the same profits by selling less gasoline. This reduced supply fits in perfect with the above formulas in pushing up prices, yielding no revenue benefit for the government, forcing it again to look elsewhere to make up the shortfall.
So, we continue in good King George Bush fashion with this plan, by decreeing the laws of nature and to hell with nonsensical things such as facts. This is perfectly in alignment with other brilliant Republican strategies, including but not limited to, privatizing Social Security, boundless free trade agreements, pushing abstinence as the sole means to address teen pregnancy, eliminating terrorism by pissing off as many people in the world as possible, and preaching good wholesome science like intelligent design in the classroom.
And my eyes were already welling up with tears from the loss of Premier W. It is good to see that we still have ‘publicans willing to fight the good fight for the constitutional right to have a moron for President. It also shows once again that Senator Obama seems to be the only candidate with the “temerity” to actually critically think complex things (like reality) through rather than take every opportunity to pander to voters.