Sadly, the myth that tax cuts for corporations and the rich creates economic growth is still the basis for Republican policy on pretty much everything.
Want better health care? Cut taxes for insurance companies and stop regulating them. Need new roads? Cut taxes for the rich so that they might be incentivized to build private roads. Public school system failing? Cut taxes so that people can afford to go to private schools.
This sounds great in principle -- give people their money back and they'll reinvest it into society. Except of course they don't, as the past 8 years have highlighted beyond any reasonable doubt as corporations hoarded trillions of dollars after the economic crash in 2008, and the government stepped in to kickstart the economy.
Of course Fox News hasn't gotten the memo about this, and continues to peddle right wing mythology as mainstream economic thought. This is not surprising given Fox is owned by Rupert Murdoch, a fanatical conservative who benefits from a tax system that disproportionately favors the ultra wealthy like him, but the mythology is getting harder and harder to maintain as the facts protrude into right wing fantasy land.
In a revealing segment on Fox News yesterday, Austan Goolsbee, a University of Chicago economics professor and former chairman of President Obama's Council of Economic Advisers, took down Fox Business host Stuart Varney in brutal fashion after Varney argued that the only way to reverse the relatively stagnant economy was to -- wait for it -- cut taxes for the rich.
Here is the crux of the exchange:
STUART VARNEY: Is there something wrong with lowering individual and corporate tax rates so that you give money back, and it gets right into private enterprise and stimulates the great engine of growth? I mean, what’s wrong with that?
AUSTAN GOOLSBEE: There's only one thing potentially wrong with that. Overall it doesn't -- it's not wrong, but if by doing so you choke off the money that you needed to make the investments that are critical to your future growing, then there is something majorly wrong with that. If you say, you know what let's do, let's cut spending on financial aid so people don't get education. We don't have money to spend on scientific research, we don't have money for infrastructure, then I think you've got problems.
VARNEY: Wait a second, what's wrong with cutting individual tax rates immediately and corporate tax rates immediately so you bring money into private enterprise immediately? I understand that you will probably raise the deficit in the very, very short run, but over the long run you would control it because you get growth in the economy and growth is the thing that we need more than anything else.
GOOLSBEE: You're sounding dangerously like you're coming back to the -- well these tax cuts are going to pay for themselves. Though, I like that you admitted that in the short run you know they would not pay for themselves.
Goolsbee, who for some reason is a regular guest on Fox News despite his track record of embarrassing the hosts, is an economist not to be messed with. His ability to recall the minutia of historical data, exceptional grasp of economic theory and ice cool demeanor makes him the perfect antidote to Fox News's hyperbolic nonsense. Of course Varney and his colleagues will continue to peddle their easily disprovable propaganda on a daily basis, but thankfully we have Austan Goolsbee to dismantle it.