Tax Cuts the Deficit and Republican Ideology

On Tuesday CBO released its latest round of number crunching. Their figures showed the 2011 deficit will most likely reach $1.5 trillion. That's a staggering number no doubt. The confusing part for Republicans, however, is that last year CBO projected the 2011 deficit would be slightly over $1 trillion.

Genius Republicans are reading this a couple different ways. One, they are insisting CBO's numbers were so off last year because CBO is prone to mistakes. And/or Obama's out of control spending has increased the deficit nearly $500 billion in one year. Both are ridiculous.

The $500 billion difference comes from the tax cuts that were passed in December 2010.

The Bush tax cuts were set to expire on Dec. 31st, 2010.  So last year when CBO was doing its projections for 2011 they figured in the expiration of those cuts, which was the one trillion number.  But since the tax cuts were extended for another two years with other cuts added onto them, CBO had to revise its numbers to reflect the new round of cuts.  That gives us the new $1.5 trillion deficit.

For those who are not genius Republicans, that means tax cuts added $500 billion to the deficit, or $442 billion to be exact.

Now something like this flies in the face of Republican thought.  They purport to believe tax cuts do not add to the deficit and that they do not have to be offset by spending cuts.  But tax cuts do indeed add to the deficit if they are not paid for with spending cuts.  In fact, this latest round of tax cuts increased the budget deficit by 50%.