Lyons: Bush Tax cuts are to blame (Real Cause of Deficit Pt 7)(Famous Arkansan, Wayne Jackson)

 Gene Lyons in his article “Sure, the government is just like your family,” Nov 24, 2010 commented, “The current deficit’s almost entirely a product of two things: the Bush tax cuts and the recession.”

I don’t accept Lyons assertion that the Bush tax cuts have anything to do with the deficit. In fact, the revenue went up after the tax cuts.

Brian Riedl is the author of the article “The Three Biggest Myths About Tax Cuts and the Budget Deficit,” (Heritage Foundation, June 21, 2010), and the next few days I will be sharing portions of his article.

Riedl’s budget research has been featured in front-page stories and editorials in The New York Times, The Wall Street Journal, The Washington Post and The Los Angeles Times. He has discussed budget policy on NBC, CBS, PBS, CNN, FOX News, MSNBC, and C-SPAN. He also participates in the bipartisan “Fiscal Wake-Up Tour,” which holds town hall meetings across America focusing on the looming crisis in Social Security, Medicare, and Medicaid.

Myth #3: Declining revenues are driving future deficits.

Fact: Rapidly increasing entitlement spending will cause nearly 100 percent of rising long-term deficits.

The proper way to diagnose the cause of long-term deficits is to measure taxes and spending against their historical averages. This identifies the moving variable that is causing the rising deficits. In this instance, it shows that runaway entitlement spending is overwhelmingly driving long-term deficits.

Projected Cost of Spending and Tax Cuts, 2011-2020

Over the past 50 years, Washington has collected an average of 18.0 percent of GDP in revenue, spent 20.3 percent of GDP, running a sustainable deficit of 2.3 percent of GDP. Annual figures have not deviated much from these averages. Even as tax rates fluctuated, tax revenues rarely deviated by more than 1 percentage point from 18.0 percent of GDP. The composition of spending has shifted dramatically from defense to entitlements, yet total spending has nearly always remained within 2 percentage points of 20.3 percent of GDP. Total spending and revenues have remained remarkably stable for the past 50 years.

Revenue stability should continue. Using CBO data, the current-policy budget baseline shows that tax revenues—currently down due to the recession—are projected to rebound to their historical average as the economy recovers. In fact, 2020 tax revenues are projected at 18.2 percent of GDP—slightly above the historical average.[13] This estimate assumes that the 2001 and 2003 tax cuts will be extended and the alternative minimum tax patched.

Yet spending stability has ended. Baseline spending is projected to leap to 23.7 percent of GDP by 2015 and to 26.5 percent by 2020—levels not seen since World War II. (See Chart 4.)

Surging Spending is Causing the Rising Deficits

Thus, the 2020 budget deficit is projected at 8.3 percent of GDP—6.0 percentage points above the historical average. This will be the net effect of spending rising to 6.2 percentage points above the historical average, compared to tax revenues rising to 0.2 percentage point above the historical average.

The discrepancy is projected to grow over time. The CBO’s long-term budget projects that tax revenues will continue growing over the next 75 years, reaching a record 22 percent of GDP. However, spending will rise to an unfathomable 67 percent of GDP.[14]

Simply put, higher spending, not declining tax revenues, are causing the rising long-term budget deficits. Even if the 2001 and 2003 tax cuts and the AMT fix are extended, revenues will remain above the historical average and eventually reach record levels. This is true by any measure—nominal dollars, inflation-adjusted dollars, and percentage of the GDP.

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This is another part of my series on famous Arkansans. This is part 3 on Wayne Jackson who grew up in West Memphis.

Elvis Presley “If I can dream”

 (Right: The Memphis Horns at EP’s Beale Street, 2002.)EIN – When, as a musician, did you first become aware of Elvis in Memphis?W.J – When we were the Mar-Keys and had the first record Elvis would sometimes come out & see us ‘cos he loved the horns. He would come to some clubs we worked at and he’d sometimes park out the back behind the Rainbow Room.

On our break we’d go outside and hang around with Elvis or whoever was with him in the parking lot. Elvis had that voice and the looks and he soaked up all kinds of music. He learnt a lot from everybody.

EIN – Did you spend any time with Elvis at Graceland?

W.J – Once in a while we’d go out to Graceland. At times we went to the movies late at night with him where we would have a caravan of cars and we’d all go to the Memphian. And sometimes we’d troop out to the Fairgrounds with him – which was a lot of fun. Elvis would want to ride that roller-coaster Zippin’ Pippin and so we’d all go ride the Pippin. Then when he tired of that we would all go to the bumper cars and everybody would ride them for a while. It was real fun, and it allowed everyone to relax much more than they could if we were all at his Graceland house.

I remember one time waiting for Elvis to come down, sitting in an old gnarly Jungle Room chair and the damn thing nearly swallowed me up! We would sit around drinking Cokes, may be 15 or 20 of us, and sometimes he might not come downstairs ’til one O’clock in the morning. So eventually we’d get back around 5 or 6 in the morning but I would have to beg out as I’d have to be back in the recording studio at noon. Of course in retrospect now I wish I hadn’t! But we were working really hard making hit records and I needed more than three or four hours sleep!

EIN – How did you get to see so many of Elvis’ performances in Las Vegas.

W.J – It just happened that I am a qualified pilot. Elvis’ cousin Bobbie Ayers was married to a wealthy real estate developer and I was the co-pilot of his Lear jet. So when Elvis would open in Las Vegas I would fly their Lear jet down there and we’d all go and see Elvis’ opening show. We would all sit in the big booth right in the front and we’d end up going back stage after every show for the whole week! We went every time Elvis opened. Since I had played on all the records, and Elvis had known me since I was a kid, we had a natural connection for talking and he’d also like to see Bobbie, so we would just party for the week. That went on once or twice a year for several years – they were the best times.

EIN – Eventually you decided to move to Nashville.

W.J – I moved to this home in 1977 – and I like it in Nashville. I like the hills and the way it feels and almost anywhere you go you run into songwriters. A swirling cauldron of musical people! Sadly it is not that way in Memphis anymore.

In fact I was moving down to Nashville when I learned that Elvis was dead. I was shocked and suddenly thought that I was the last Memphis hold-out. American Studios was gone, Stax was gone, Hi studios was gone. Al Green wasn’t making pop records any more and Steve Cropper had left town. All the people from American had left town, Reggie Young, Bobby Wood, Bobby Emmons and Chips Moman. They could have turned the lights out. It seemed to be all over. Otis Redding was dead – and now Elvis was dead. I was the last guy leaving Memphis. It was over, it really was the end of this era.

EIN – Booker T & the MGs along with the Mar-keys was a great mixture of soulful black & white musicians. What do you think the black Memphians thought of Elvis?

W.J – I sincerely believe that the black people respected Elvis’ success. Even if they didn’t respect all the songs that he sang, especially in those sixties movies, they respected his success. You have to. When you look back at the great songs that he sang, like ‘In The Ghetto’ and ‘If I Can Dream’ he was a truly great singer. Elvis was also a great gospel singer because he loved it and truly believed it.

You know even in those movies I admire him for being “Elvis” no matter what his costume or his name was. I only wish that he had gotten a good movie role where he could have proved himself just one time. I honestly think he could have if he had lived long enough. One day someone would have finally let Elvis play a legitimate acting role!

EIN – Sadly Elvis never got the chance.

W.J – Yeah, in later years Elvis fell into bad habits. Those things he fell into will destroy and distort anyone. I don’t care how strong you are, drugs are bad.

But deep down Elvis was a great example of what a Southern person was like. Elvis held his family values highly. He loved Mother – a typical Southern boy – He loved his Mother and his Daddy and God and the United States. And why not? Elvis came from Tupelo and turned into the “King of Rock’n’Roll” – It was the American Dream.

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