On NBC’s Meet the Press today, Republican Budget Chairman Paul Ryan falsely claimed that the payroll tax cut doesn’t work. Ryan said:
I don’t think this works to grow our economy” and compared the payroll tax cut to “sugar-high economics.
In reality, independent economists like former John McCain economic advisor Mark Zandi said blocking the payroll tax cut for 160 million middle income Americans would trigger an economic recession and could cost nearly 1 million American jobs. The non-partisan Congressional Budget Office found that extending the payroll tax cut is more cost effective to promote economic growth and employment than the tax breaks for the ultra wealthy that Ryan and House Republicans support.
Mark Zandi's chart: note the payroll tax holiday returns $1.29
FACT CHECK
Mark Zandi: Payroll Tax Cut Needed to Avoid Recession. “Failure to extend a payroll tax holiday into 2012 could trigger another recession, noted U.S. economist Mark Zandi said on Thursday, as Democrats called the extension a top priority needing quick action.” [Reuters,
10/6/11]
Reducing Payroll Taxes on Firms Creates More Jobs Than Tax Cuts for the Wealthy. In January 2010, the non-partisan Congressional Budget Office wrote that reducing payroll taxes for firms was among the policies “that would have the largest effect on output and employment per dollar on budgetary cost in 2010 and 2011. By contrast, policies that would temporarily increase the after-tax income of people with relatively high income, such as an across-the-board reduction in income taxes […] would have a smaller effects because such tax cuts would probably not affect the recipients’ spending significantly.” [Congressional Budget Office,
1/10]
T
Congressional Budget Office: Reducing Employers’ Payroll Taxes, Increasing Unemployment Aid Will Have Bigger Impact on Employment Than Other Proposals. “Policies that would have the largest effects on output and employment per dollar of budgetary cost in 2012 and 2013 are ones that would reduce the marginal cost to businesses of adding employees or that would be targeted toward people who would be most likely to spend the additional income. Such policies include reducing employers’ payroll taxes (especially if limited to firms that increase their payroll), increasing aid to the unemployed, and providing additional refundable tax credits in 2012 for lower- and middle-income households.” [Congressional Budget Office,
11/15/11]
National Federation of Independent Business: Payroll Tax Holiday Can Create Jobs. The National Federation of Independent Business has said that a payroll tax holiday for small businesses would help “struggling businesses reduce costs” and “can reduce unemployment and keep people working during a period of slowed economic growth.” [NFIB, accessed
9/16/11]
Republican Budget Chairman Paul Ryan Called Extending the Payroll Tax Cut “Sugar-High” Economics.House Budget Committee Chairman Ryan “rejected the idea of making further short-term changes to the payroll tax” and called payroll tax cuts “sugar-high economics.” [The Hill,
6/16/11]
Rightardia considers Paul Ryan a clueless frat boy who will say what the Establishment Republicans tell him to say. Curiously, his name is being as one of the "stand in nominees" if Mittens doesn't make the cut by convention time in Tampa.
Jeb Bush and Chris Christie's names are also on that list.
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