Yes, you read that right. The non-partisan Tax Policy Center has done its analysis of the Pawlenty economic plan and concluded that would be the ten-year cost of the Pawlenty tax cuts, as compared to current law. If you assume that all the Bush tax cuts and other policies stay in place, the cost, according to the TPC estimates, would be a mere $7.6 trillion. To think of it another way, Pawlenty is proposing tax cuts that are the equivalent of taking the existing Bush tax cuts and tripling them over the next decade. In 2021 alone, the cuts would exceed $1.6 trillion compared to current law (that is, letting the Bush tax cuts expire), or $1 trillion compared to current policy (extending all the tax cuts and the accompanying patches to the alternative minimum tax.)
By the way, the Pawlenty campaign doesn’t dispute that its tax cuts would be costly — it just differs from TPC about the magnitude. According to the Pawlenty campaign’s estimates, the net cost of the tax cuts — assuming they produce the 5 percent economic growth that Pawlenty anticipates — would be $2 trillion. If economic growth stays at the same level as currently projected, the campaign says the cost would be $5.8 trillion compared to current law.
As I said in my Friday column, this is the very definition of fiscal insanity. Trillions of dollars in additional tax cuts are the last thing the country needs. But not just insanity — unfairness, as well. Take aa look at TPC’s distributional tables. Compared to leaving the Bush tax cuts in place (which I assume would be the former Minnesota governor’s second choice), the tax cuts would give those with incomes of more than $1 million a nearly $500,000 tax cut ($489,956, to be precise.) These million-dollar earners would get 38.6 percent of the total benefit of the tax change. Those in the middle fifth of earners would get an average cut of $955, or 4.6 percent of the total benefit.
And you thought he was a Sam’s Club Republican?