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Forum Post: Debunking the Seven Big Economic Lies of the GOP

Posted 12 years ago on Jan. 28, 2012, 6:40 p.m. EST by nucleus (3291)
This content is user submitted and not an official statement

Debunking the Seven Big Economic Lies of the GOP

Demagogues through history have known that big lies, repeated often enough, start being believed -- unless they're rebutted. These seven economic whoppers are just plain wrong. Make sure you know the truth -- and spread it on.

1. Tax cuts for the rich trickle down to everyone else. Baloney. Ronald Reagan and George W. Bush both sliced taxes on the rich and what happened? Most Americans' wages (measured by the real median wage) began flattening under Reagan and has dropped since George W. Bush. Trickle-down economics is a cruel joke.

2. Higher taxes on the rich would hurt the economy and slow job growth. False. From the end of World War II until 1981, the richest Americans faced a top marginal tax rate of 70 percent or above. Under Dwight Eisenhower it was 91 percent. Even after all deductions and credits, the top taxes on the very rich were far higher than they've been since. Yet the economy grew faster during those years than it has since. (Don't believe small businesses would be hurt by a higher marginal tax; fewer than 2 percent of small business owners are in the highest tax bracket.)

3. Shrinking government generates more jobs. Wrong again. It means fewer government workers -- everyone from teachers, fire fighters, police officers, and social workers at the state and local levels to safety inspectors and military personnel at the federal. And fewer government contractors, who would employ fewer private-sector workers. According to Moody's economist Mark Zandi (a campaign advisor to John McCain), the $61 billion in spending cuts proposed by the House GOP will cost the economy 700,000 jobs this year and next.

4. Cutting the budget deficit now is more important than boosting the economy. Untrue. With so many Americans out of work, budget cuts now will shrink the economy. They'll increase unemployment and reduce tax revenues. That will worsen the ratio of the debt to the total economy. The first priority must be getting jobs and growth back by boosting the economy. Only then, when jobs and growth are returning vigorously, should we turn to cutting the deficit.

5. Medicare and Medicaid are the major drivers of budget deficits. Wrong. Medicare and Medicaid spending is rising quickly, to be sure. But that's because the nation's health-care costs are rising so fast. One of the best ways of slowing these costs is to use Medicare and Medicaid's bargaining power over drug companies and hospitals to reduce costs, and to move from a fee-for-service system to a fee-for-healthy outcomes system. And since Medicare has far lower administrative costs than private health insurers, we should make Medicare available to everyone.

6. Social Security is a Ponzi scheme. Don't believe it. Social Security is solvent for the next 26 years. It could be solvent for the next century if we raised the ceiling on income subject to the Social Security payroll tax. That ceiling is now $106,800.

7. It's unfair that lower-income Americans don't pay income tax. Wrong. There's nothing unfair about it. Lower-income Americans pay out a larger share of their paychecks in payroll taxes, sales taxes, user fees, and tolls than everyone else.

Robert Reich - 7 Lies



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[-] 7 points by DKAtoday (33802) from Coon Rapids, MN 12 years ago

Thank you for this post.

Truth can be hard to see for all of the lies and twisted facts.

Common sense is not all that common. Support education.

Unite in common cause for "ALL".

[-] 6 points by beautifulworld (23771) 12 years ago

Big, big lies. Thank goodness for people like Robert Reich who can explain this stuff to the layperson.

[-] 5 points by UncomonSense (386) 12 years ago

The silence of the wingnuts on this topic is telling.

[-] 4 points by shoozTroll (17632) 12 years ago

The never posted in the ALEC thread either.

Certain truths are hard for them to accept.

[-] 3 points by nobnot (529) from Kapaa, HI 12 years ago


[+] -4 points by BonTon (57) 12 years ago

Not true: GirlFriday just weighed in.

[-] 4 points by UncomonSense (386) 12 years ago

Toasted wingnuts, anyone?

[-] 3 points by nucleus (3291) 12 years ago

As you said, the silence is deafening. You'd think deludedCapitalist freshOutOfTheSlammer and roboGalt would be all over this. Go figure ...

[-] 2 points by shoozTroll (17632) 12 years ago

I'd love some, if only they'd show up.

Too busy posting BS elsewhere, I suppose.

[-] 3 points by beautifulworld (23771) 8 years ago

This thread is timely, given the Goon Debate tonight.

[-] 2 points by beautifulworld (23771) 10 years ago

These 7 lies are still lies. Not much has changed. We have to keep fighting.

[-] 1 points by MattLHolck (16833) from San Diego, CA 10 years ago

we're saving war is peace for later ?

or is that a non-partisan lie

[-] 1 points by Ache4Change (3340) 10 years ago

'Social Security is a Ponzi scheme. Don't believe it.' Absolutely! This is a great OP! In support: http://www.nationofchange.org/don-t-get-complacent-about-social-security-they-still-want-cut-it-1377005520 Never Give Up Exposing The Greedy 1% Plutocrats! Occupy All Streets! Solidarity.

[-] 2 points by shoozTroll (17632) 10 years ago

Silly folks.

WallStreet is THE ponzi scheme.

Perhaps a slight return?


[-] 3 points by Ache4Change (3340) 10 years ago

Wall Street IS The Ponzi Scheme! Correct! Return? How about this important link in compliment - http://www.nationofchange.org/matt-taibbi-us-student-loan-bubble-saddles-generation-debt-and-threatens-economy-1377091311 Never Give Up Exposing The Venal Plutocrats! Occupy Democracy!

[-] 2 points by shoozTroll (17632) 10 years ago

With fall, fast approaching, student debt should once again return to the forefront.

I fear for my daughter.

[-] 3 points by MattLHolck (16833) from San Diego, CA 10 years ago

education should be free

[-] 2 points by shoozTroll (17632) 10 years ago

I wholeheartedly agree..................:)

I rue the day Reagan forced us to step in the other direction.

That day, education became about profit, and it's overall quality has fallen far ever since.

[-] 2 points by MattLHolck (16833) from San Diego, CA 10 years ago

education is probably improving with extended media

[-] 1 points by shoozTroll (17632) 10 years ago

Time will tell on that account, it's still in it's infancy.

They will likely start charging an arm and a leg or two, for the most effective lessons.

[-] 1 points by MattLHolck (16833) from San Diego, CA 10 years ago

it's beyond infancy

teachers should be paid for through taxation

[-] 1 points by shoozTroll (17632) 10 years ago

The tech involved in extended media, is what I suggest is in it's infancy.

Soon it will be about enhancing the ability to learn.

As far as pay?

Are you referring to higher education, as K-12 is paid through tax dollars now, although I feel they need their right to collective bargaining should be returned to them in full.

[-] 1 points by shoozTroll (17632) 12 years ago

The coals are ready, where are the wingnuts?

Or are they lugnuts?

[-] 1 points by shoozTroll (17632) 12 years ago

You should have put FAKESnews in the title to get their attention.


[-] -1 points by iwantfreemoneynow (58) 12 years ago

It's so blindingly stupid I believe most conservatives are stunned into silence by the sheer hubris of it all. :)

[-] -2 points by asauti (-113) from Port Orchard, WA 12 years ago

Funds for Social Security are extracted from an employee's paycheck. The government takes a portion of these funds for administrative costs and holds the rest in "savings". These savings are then given back to the worker, in the form of monthly payments, after they hit retirement age.

Do I have anything wrong, so far?

[-] 0 points by Kirby (104) 12 years ago

Yes you do. They spend the money, instead of putting it in a "lockbox". When the program was started under FDR, their were 27 workers to a person collecting, today it is 3:1.


[-] -3 points by stenchy (-3) 10 years ago

Yea...pay not attention to the 16 trillion dollar debt. It's meaningless. Just look at Greece, Spain and Italy, . They are doing just fine while running up debt, and going broke. Other than those riots, and 40% unemployment.

Fucking economic ignorant communist morons on this board. All you understand is one fact. "GIVE ME MORE FREE STUFF. And you people that have jobs...PAY FOR IT!."

[-] -3 points by hoot (313) 12 years ago

I wont defend Bush but within 2 years of Reagan's 8 year term the unemployment rate dropped from 10.4% to 7.5% reaching as low as 5.4%

We will always have a need for teachers, firemen, police etc but they don't have to be government run jobs. plus the above mentioned jobs are more or less paid by each individual state, i believe youre talking about shrinking the federal gov.

Medicare and Medicaide are horrible health insurance systems that provide for very poor results. And they are major budget deficits, along with our military.

A Ponzi scheme is an economic arrangement where the money paid into the system by later entrants is paid right back out as benefits to earlier entrants. That is exactly what social security is.

This mentality encourages people to be poor, plus how do thy pay more sales tax user fees and tolls than everyone else?

[-] 3 points by nucleus (3291) 12 years ago

Deficit spending created those jobs. Don't forget that Reagan tripled the national debt during his two terms and raised taxes 11 times. It used to be that deficit spending created jobs, mostly in the private sector with government contracts. Now government spending is used to prop up profits at the corporate banks that have bankrupted the country.

Medicare and Medicaid (and the VA) provide health insurance to over 100,000,000 people. These are not horrible programs, and their results are not poor, especially compared to private insurance that costs more and denies care.

Social Security is a Ponzi Scheme? LOL. This has been debunked so many times it's funny that some people are still trotting around this bag of crap. SS is a pay as you go system.

The poor pay more sales taxes and uses fees as a proportion of their income. Just like the rich pay a smaller proportion of their income in taxes (Romney 13.9%).

[+] -4 points by pedro01 (1) 12 years ago

note that the rich do pay more income taxes, its a progressive tax, you should should know that. You are thinking of taxation of investments that is at 15%.


[-] -3 points by ZenDogTroll (13032) from South Burlington, VT 12 years ago
[-] 3 points by beautifulworld (23771) 12 years ago

Nice work, ZenDog.

[+] -5 points by ZenDogTroll (13032) from South Burlington, VT 12 years ago

why thanks

Lets see if this works:

I think that'll tweet - if I formatted it right

and it does!

[-] 2 points by beautifulworld (23771) 12 years ago

Sorry, I don't tweet!

[+] -5 points by ZenDogTroll (13032) from South Burlington, VT 12 years ago

It is kinda boring

I only tweet because they have tracking data to identify trends - and if enough of us all tweet

  • corporations do not have tongues

I think someone will shit their pants

[-] 2 points by beautifulworld (23771) 12 years ago

No you keep tweeting, especially at that group you listed.

[+] -5 points by ZenDogTroll (13032) from South Burlington, VT 12 years ago


I'm hoping it'll catch on.

; D

[-] -3 points by GirlFriday (17435) 12 years ago

Great post.

[+] -4 points by pedro01 (1) 12 years ago

Robert Reich is a partisan hack and therefore biased-- so he could be wrong on some of these 'lies'? My favorite 'lie' is that shrinking government generates more jobs'. Of course it's not a lie; and i'm not talking about government jobs such asteachers, police, firemen (liberals always use taking their jobs away as a scare tactic), i'm talking about the large Fed and state bureaucracies. The money they use up, is money taken away from the private sector for investments and new private sector jobs. Government jobs do not add value, they do not directly grow the economy.

[-] 2 points by nucleus (3291) 12 years ago

Don't like the message, attack the messenger. Typical partisan hack response.

The bailout didn't go to creating jobs, it went to shoring up the profits of the corporate bankers. Where it was used to create private sector jobs (GM), it was a resounding success. If the GOP could somehow agree to fund rebuilding the crumbling civil infrastructure, that would be millions of private sector jobs created with public spending.

Size of government is irrelevant. It should be whatever size is necessary to successfully accomplish its responsibilities. The corporate plan is to make government dysfunctional in order to "justify" less government (really less effective government), less regulation of business (a primary responsibility) and more outsourcing of what were non-profit government services to for-profit corporations: essentially to use the government as a vehicle to collect public revenue and deliver it directly into corporate hands.

The one thing that remains crystal clear is that you are absolutely clueless, as well as ignorant of history and oblivious in regard to cause and effect.

[+] -4 points by pedro01 (1) 12 years ago

Hey i'm willing to debate, did you even read 'Lie' #3? Let's say there are 10 people. 5 work for a company making chairs, they pay taxes to support the other 5 working in the government, everyone is somewhat happy. Now change the ratio to 3 people working for the company and 7 for the government. The 3 now will have to pay more taxes to support those 7 governments workers. No one is better off and eventually we run out of money, sounds like the U.S. today, you can't tax your way to prosperity. Now if you had 3 government workers and 7 people making chairs they would have to pay less taxes(only 3 government employees to support) and they could keep more of their money.

[-] 4 points by nucleus (3291) 12 years ago

Yep, it's a lie.

Government workers pay taxes. Government buys chairs, too. Government is essentially a non-profit corporation providing services to the public. Or it would be if it wasn't run by corporations ...

[-] -2 points by Kirby (104) 12 years ago

The problem nucleus is government does not create income, it sucks it out of the citizenry, leaving the individual with less freedom. We need government for many things, but it has reached the tipping point and has gotten too big. More government=less freedom. Less government=more freedom. I don't see how 535 creeps in Washington think they know what is best for 310 million people. And it is even harder for me to understand how people with brains want more government control in their lives.

[-] 2 points by nucleus (3291) 12 years ago

Do you not understand who the creeps in Washington work for?

[-] -1 points by Kirby (104) 12 years ago

Everyone knows they are on the take. I should have said 536 to include king Obama.

[+] -4 points by pedro01 (1) 12 years ago

but government doesn't create dollar value and relies on forced taxation for revenue. Your model sounds like communism where government even owns the means of production, and we know how well that works.

[-] 2 points by nucleus (3291) 12 years ago

Sounds like deludedCapitalist ...