Dan Mitchell looks at the lies that the US Democrats are using to sell a carbon tax.
The claim about “revenue neutrality” is a stunning level of dishonesty, even by Washington standards.
At the risk of stating the obvious, if the government imposes a tax and then also creates a program to give money to people, that’s not revenue neutrality.
Was Obamacare “revenue neutral” because all the new taxes were balanced out by the handouts and subsidies that the law created for the big insurance companies?
Of course not.
And a new carbon tax doesn’t magically become “revenue neutral” because new revenues are matched by new spending.
To be sure, supporters can argue that their plan is “deficit neutral,” and that would be legitimate (even though I would argue that this wouldn’t be the case in the long run because of the adverse economic impact of new taxes and new spending).
But “revenue neutral” is a bald-faced lie.