Sunday, June 19, 2011

The Pawlenty Plan Part 1

Republicans talk about how the government is broke and we can't afford to continue to spend the way are spending. In the video Pawlenty sent to declare his candidacy he said "Are country is in big trouble we have far too much debt" (watch here). In Pawlenty economic and budget plan he stated that he would like to reduce taxes. Nothing new of course in the Republican Party, but Pawlenty is taking it to a whole new level. The Bush Tax cuts are worth about 3 Trillion over 10 years. Expensive enough, but Pawlenty thinks the Bush tax cuts don't go far enough. He would reduce income tax Corporate tax and

Under Pawlenty's plan, taxes on capital gains, interest income, dividends and estates would all be eliminated.

A non-partisan policy center said the Government would lose 7.6 Trillion in revenue over ten years. That is about 760 billion a year. The deficit this year will be 1.6 trillion. So how is reducing revenue going to balance the budget Pawlenty? His plan says that he would make up the difference in spending cuts, and economic growth.

Pawlenty's plan claims that the economy of the U.S will grow by 5% every year. And therefore he thinks he will increase revenue by 380 billion every year for ten years making up only half the difference. In Canada we have faced the recession relatively okay and we don't have 5% growth rate are growth rate is 3% roughly, and we went on a spending spree. If pawlenty cut all these taxes you think that it would increase the growth rate to 5%, but you haven't taken in to account the spending cuts.

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