2012 Election, Economics, Historically, History, Politics

Dismantling Biden’s VP Debate Talking Points

Where to begin?

Health care and religious freedom.  VP Joe Biden stated, “With regard to the assault on the Catholic Church, let me make it absolutely clear. No religious institution—Catholic or otherwise, including Catholic social services, Georgetown hospital, Mercy hospital, any hospital—none has to either refer contraception, none has to pay for contraception, none has to be a vehicle to get contraception in any insurance policy they provide. That is a fact. That is a fact.”

Actually, the United States Conference of Catholic Bishops begs to differ saying “This is not a fact. The HHS mandate contains a narrow, four-part exemption for certain ‘religious employers.’ That exemption was made final in February and does not extend to ‘Catholic social services, Georgetown hospital, Mercy hospital, any hospital,’ or any other religious charity that offers its services to all, regardless of the faith of those served.”

On the economy and the Romney/Ryan economic plan.  Regardless that everyone acknowledges that cutting out tax loopholes will make up some of the taxes cut by the Romney/Ryan plan, including Stephanie Cutter, there are simple reasons how cutting taxes increases tax revenues.  Biden seemed to have difficulty understanding how this works.

Historically, tax revenues in American tend to remain a constant percentage of the GDP regardless of tax rates.  In 1954, the marginal tax rate for the wealthiest Americans was 90%.  During the 1960’s, it began to lower, but never dropped below 50% until 1986.  Dr. Antony Davies, Associate Professor of Economics at the Palumbo Donahue School of Business for Duquesne University states, “Throughout this period, the government’s revenue was almost 17% of GDP.”  From 1987, the top marginal tax rate ranged from 40% to 28% and the tax revenues for the government were just under 18% of GDP.

Obviously, 18% of a larger GDP generates more revenue than 18% of a smaller GDP.  So the question is, how do you grow the GDP?  The Gross Domestic Product is the overlap of the three sides of the economy:  expenditures, output, and income.  Simply put, the best way to increase these three areas is to lower taxes (lower the risk for individuals and businesses to invest their resources) and to lessen the burden of regulations so that it is easier to do business.

Dr. Jeff Miron, Senior Lecturer and Director of Undergraduate Studies at Harvard University’s Department of Economics, states “Raising taxes slows the economy down.  That means less tax revenue.”  Growth leads to additional growth.  As more businesses invest money in either expansion or capital improvements, that generates revenue for other businesses and individuals.  Government can not adequately perform this role for multiple reasons.  One, it leads to government cronyism such as Solyndra and Chevy Volts.  Second, as Dr. Miron explains that government spending is bad because that is spending that “could have been in the private sector.  It is spending that could have been done by a private business or an individual on something that they thought was productive, useful, or valuable.  So, we’re making decisions on that spending in Washington instead of out there in the country by individuals.”

Miron continues, “In addition, that spending is distorting all of the ways that resources are allocated.  By spending money to subsidize health insurance, we’re encouraging people to purchase too much health care.  That is really bad for the efficiency of the health care system.  By spending money by trying to enforce drug prohibition, we’re creating crime and corruption.  That is really bad for the economy.  And the list goes on and on with few exceptions such as say, some for national defense.  [Government] spending causes tons of problems because it interferes with the workings of private markets.”

One example of lowering tax rates increasing tax revenues is when in 1996, when House Republicans and President Bill Clinton agreed to drop capital gains tax rates, capital gains tax revenues spiked upwards.

On the cost of the wars in Iraq and Afghanistan.  Biden claims the reason for the current deficit is due to the wars.  In 2011, our federal government spent $3.7 trillion.  We had to borrow about a trillion dollars of the money to cover all of that spending.  The money we borrow is what comprises the deficit.  So how much of the $3.7 trillion was for the OCO (Overseas Contingency Operations aka the wars in Iraq and Afghanistan)?  It was a whopping 4.3% of the entire budget.  That amounts to a lot less than the annual deficit.  The totality of Defense spending in addition to that was only another 14.4%.

On foreign policy, where the debate most often centered, Biden referred to the terrorists attacks on an American consulate in Benghazi killing four Americans saying, “We weren’t told they wanted more security. We did not know they wanted more security there.”

In the words of Hillary Clinton, “I think that the reports that you provide to us really require a willing suspension of disbelief.”  Joe Biden is “supposedly an expert on foreign policy“, but he was unaware of the repeated requests for more security that the State Department admits to at this location despite the litany of evidence it was needed?

This is either a lie, or a show of incompetence.  Were we not told that President Obama didn’t require to be briefed on security by the security experts because he received his security briefs in written form?  Remember when Obama said:

I know more about policies on any particular issue than my policy directors.

Disgraceful.

During the debate, Biden also stated why the White House mistakenly believed the attacks were spontaneously spurred by a Youtube video, “‘The intelligence community told us that.  As they learned more facts about exactly what happened, they changed their assessment.”  This has brought the rebuke of those affiliated with the intelligence community.  A joint statement was issued by Michael Hayden, former CIA director, and Michael Chertoff, who served as Homeland Security chief, saying:

During the Vice Presidential debate, we were disappointed to see Vice President Biden blame the intelligence community for the inconsistent and shifting response of the Obama Administration to the terrorist attacks in Benghazi.

Given what has emerged publicly about the intelligence available before, during, and after the September 11 attack, it is clear that any failure was not on the part of the intelligence community, but on the part of White House decision-makers who should have listened to, and acted on, available intelligence. Blaming those who put their lives on the line is not the kind of leadership this country needs.

When one reviews the entire timeline following all the information that came forth following the attacks, it is clear that either this Administration is dishonest or incompetent.

Then Biden followed up his trashing of our intelligence community on Benghazi by assuring us that we could rely on our intelligence community to correctly inform us when Iran would be capable of loading their nuclear material into a weapon.  He can not have it both ways.  Biden deplores our intelligence community when it is politically expedient, and immediately turns around and lauds them when it was then politically expedient for him to do so.

As Joe Biden asked the American people, “Who do you trust?”

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