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Re: The 112th Congress: Debt ceiling edition
You're really something when you get wound up on this stuff!
Re: The 112th Congress: Debt ceiling edition
So most Americans know whether tax hikes destroy jobs? The majority of Americans can't balance a checkbook much less provide informed opinion on the economic impact of various decisions facing Washington.
As long as the majority of the taxes come from the minority of the people there will never be a public opinion poll in which the majority is against raising taxes {on people other than them}.
So most Americans know whether tax hikes destroy jobs? The majority of Americans can't balance a checkbook much less provide informed opinion on the economic impact of various decisions facing Washington.
As long as the majority of the taxes come from the minority of the people there will never be a public opinion poll in which the majority is against raising taxes {on people other than them}.
P
Priceless
Guest
Re: The 112th Congress: Debt ceiling edition
<iframe src="http://player.vimeo.com/video/26588252?title=0&byline=0&portrait=0" width="400" height="300" frameborder="0"></iframe><p><a href="http://vimeo.com/26588252">Actual Audio: Eric Cantor On Taxes</a> from <a href="http://vimeo.com/user175271">scottbateman</a> on <a href="http://vimeo.com">Vimeo</a>.</p>
<iframe src="http://player.vimeo.com/video/26588252?title=0&byline=0&portrait=0" width="400" height="300" frameborder="0"></iframe><p><a href="http://vimeo.com/26588252">Actual Audio: Eric Cantor On Taxes</a> from <a href="http://vimeo.com/user175271">scottbateman</a> on <a href="http://vimeo.com">Vimeo</a>.</p>
Kepler
Si certus es dubita
Re: The 112th Congress: Debt ceiling edition
I'm glad to hear you are on board with economic and social policies that decrease the income gap.
Head Start and the GI Bill did more to grow the economy than all the upper class tax cuts in history.
I'm glad to hear you are on board with economic and social policies that decrease the income gap.
Head Start and the GI Bill did more to grow the economy than all the upper class tax cuts in history.
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Re: The 112th Congress: Debt ceiling edition
Where the GOP Went Wrong on Deficits and Debt
As the deadline to avoid a government default nears, John Avlon retraces how the Republican Party abandoned fiscal responsibility in favor of reckless tax cuts and “deficits don’t matter” policies.
Jul 19, 2011 10:01 AM EDT Print Email When did fiscal responsibility and fiscal conservatism get de-linked?
That is the key question that underlies the fault lines in the current GOP civil war, playing out over the debt-ceiling debate as every day we get closer to default.
It’s too simple to call this a fight between the old guard and the Tea Party. The real test is whether government fiscal policy should be focused on reducing the deficit and the debt or whether the real goal is to keep taxes low at all costs. It’s a divide decades in the making between the deficit hawks and the anti-tax absolutists.
On one side is a belief in math rooted in the businessman’s reality—profits and losses, revenues and expenditures. It is a two-way equation.
On the other side is the blind faith that tax cuts will always ultimately pay for themselves. In a businessman’s world this imbalanced approach usually leads to bankruptcy.
Fiscal conservatism and fiscal responsibility used to be synonymous. This was a core distinction between Republicans and Democrats. When a Republican candidate promised conservative budgets, he meant to rein in spending and reduce deficits and debts, in contrast to a belief in Keynesian social spending and the political benefits of overgenerous union contracts. The bottom line was generational responsibility.
But now the Republican camp is divided. On one side is a Republican tradition rooted in Eisenhower and Reagan. On the other is the legacy of Grover Norquist, Tom DeLay, W., and Dick Cheney—tax cuts always comes first, and “deficits don’t matter.”
AP Photo
When Dwight Eisenhower decided to run for president as a Republican after a lifetime as an independent, he was motivated in part by frustration that Democratic President Harry Truman presented a budget with a $14 billion deficit (!)—prompting an eight-page protest in Ike’s diary. In his campaign kickoff speech, he spent most of the time on fiscal matters, warning that “today, staggering federal expenditures for civil and military purposes have soared to totals beyond the comprehension of ordinary individuals … Heedless expense is an investment in bankruptcy.”
This significance of this line of attack was that the former Allied commander knew he could call for belt-tightening in the military budget and not be called a communist sympathizer by the rising McCarthyites of the time. And while Ike was criticized by contemporary conservatives, from Robert A. Taft to William F. Buckley, for not dismantling the New Deal and failing to cut taxes significantly, his deficit-to-GDP ratio and spending to GDP stands as the lowest of any modern president.
In 1981 Ronald Reagan laid out one of the clearest articulations of fiscal responsibility in his Inaugural Address: “You and I, as individuals, can, by borrowing, live beyond our means, but for only a limited period of time. Why, then, should we think that collectively, as a nation, we are not bound by that same limitation?”
The great irony of the Gipper was that he actually increased the deficit and federal spending in his administration. But he did so reluctantly, calculating correctly—in history’s eyes—that ramping up military spending would enable him to help end the Soviet Union and defeat communism.
But by the time Bush 41 was in office, his bipartisan deficit-reduction deal violated his prominent “no new taxes” pledge and consequently drew a crippling primary challenge in the form of Pat Buchanan’s conservative populist campaign.
Rather than whitewashing Reagan’s fiscal record, it is helpful to view it in full. Yes, he cut taxes dramatically, spurring the kind of economic activity that comes when the top rate is cut from 70 percent to 28 percent. But he closed loopholes and broadened the tax base—including raising Social Security taxes as part of a bipartisan fix—all actions that would get him attacked as a RINO today by the anti-tax crowd that idolizes him in the abstract. And don’t forget that Reagan presided over a rise in the debt ceiling some 17 times.
“
It’s a divide between the deficit hawks and the anti-tax absolutists.
”
The divided government of Clinton and Gingrich finally succeeded in turning the deficit into a brief, hard-won surplus as our economy boomed (after taxes were raised, spending was cut and the Internet appeared right on time).
But when George W. Bush took office, he squandered the surplus on tax cuts whose costs were compounded by two unfunded foreign wars and a growth in domestic discretionary spending that outpaced even LBJ. This pain-free approach was encouraged by Republican House leaders like Tom DeLay and others as a way to buy a “permanent majority.” This is when de-linkage occurred; as Vice President Cheney famously told first-term Treasury Secretary Paul O’Neill, “Deficits don’t matter.”
Contrary to contemporary myths, conservatives' support for Bush & Co. was not seriously diminished as a result of all this deficit spending. When Republican economists like Bruce Bartlett raised concerns about this de-linkage, they were drummed out of the party for disloyalty. The leading contemporary congressional critic of this spending spree was John McCain—and he was likewise derided as a RINO whose conservatism was questioned because of his principled independence. And when the Tea Party emerged in 2009, polls showed their members held an unseasonably high 70 percent approval for W., despite their anti-deficit, repudiate-the-past rhetoric.
Now we are in the middle of a great debate about debt ceilings and deficit reduction. Advocates of fiscal responsibility want to make the best and biggest deal possible—preferably a grand bargain that would raise the debt ceiling while agreeing to spending cuts, entitlement reforms, and—yes—some revenue increases, if not outright tax hikes. The all-or-nothing crowd is focused on an anti-tax litmus test, default be ****ed.
The obvious alternative—ripe for constructive compromise—is tax reform: close the loopholes that function as earmarks in the tax code and therefore raise revenue without raising tax rates. We might even be able to lower some rates as a result. This is what is called a win-win.
But anti-tax absolutists say that any revenues raised by closing-tax loopholes must be offset by further tax cuts, making them effectively deficit neutral. Professional activists like Grover Norquist hold a pledge and a primary threat over Republicans' heads. And this position is aided by prominent conservative populists like Michele Bachmann who parade under the Tea Party banner but are more focused on litmus-test politics than actually solving problems.
In contrast, Sen. Tom Coburn—who, on Monday, released a $9 trillion Black” plan that would cut spending dramatically, reform entitlements, and raise some revenues—has become an example of problem-solving politics that offers policy specifics.
And among the likely proposals that could come with a Plan B—being negotiated by Republican Senate Leader Mitch McConnell and Democratic Senate Leader Harry Reid—would be a binding bipartisan deficit-reduction panel that would likely pick up much of the plan forged by the Simpson-Bowles commission, itself a model of far-reaching fiscal responsibility.
It doesn’t take a presidential historian to notice that in recent years Republicans have cared most about deficits when there is a Democrat in the White House. And it doesn’t take an economist to know that our current fiscal path is unsustainable.
The irony is that reasserting the Republican tradition of fiscal responsibility could be exactly what the GOP needs to restore its lost moral authority on the generational theft that is deficits and debt.
Where the GOP Went Wrong on Deficits and Debt
As the deadline to avoid a government default nears, John Avlon retraces how the Republican Party abandoned fiscal responsibility in favor of reckless tax cuts and “deficits don’t matter” policies.
Jul 19, 2011 10:01 AM EDT Print Email When did fiscal responsibility and fiscal conservatism get de-linked?
That is the key question that underlies the fault lines in the current GOP civil war, playing out over the debt-ceiling debate as every day we get closer to default.
It’s too simple to call this a fight between the old guard and the Tea Party. The real test is whether government fiscal policy should be focused on reducing the deficit and the debt or whether the real goal is to keep taxes low at all costs. It’s a divide decades in the making between the deficit hawks and the anti-tax absolutists.
On one side is a belief in math rooted in the businessman’s reality—profits and losses, revenues and expenditures. It is a two-way equation.
On the other side is the blind faith that tax cuts will always ultimately pay for themselves. In a businessman’s world this imbalanced approach usually leads to bankruptcy.
Fiscal conservatism and fiscal responsibility used to be synonymous. This was a core distinction between Republicans and Democrats. When a Republican candidate promised conservative budgets, he meant to rein in spending and reduce deficits and debts, in contrast to a belief in Keynesian social spending and the political benefits of overgenerous union contracts. The bottom line was generational responsibility.
But now the Republican camp is divided. On one side is a Republican tradition rooted in Eisenhower and Reagan. On the other is the legacy of Grover Norquist, Tom DeLay, W., and Dick Cheney—tax cuts always comes first, and “deficits don’t matter.”
AP Photo
When Dwight Eisenhower decided to run for president as a Republican after a lifetime as an independent, he was motivated in part by frustration that Democratic President Harry Truman presented a budget with a $14 billion deficit (!)—prompting an eight-page protest in Ike’s diary. In his campaign kickoff speech, he spent most of the time on fiscal matters, warning that “today, staggering federal expenditures for civil and military purposes have soared to totals beyond the comprehension of ordinary individuals … Heedless expense is an investment in bankruptcy.”
This significance of this line of attack was that the former Allied commander knew he could call for belt-tightening in the military budget and not be called a communist sympathizer by the rising McCarthyites of the time. And while Ike was criticized by contemporary conservatives, from Robert A. Taft to William F. Buckley, for not dismantling the New Deal and failing to cut taxes significantly, his deficit-to-GDP ratio and spending to GDP stands as the lowest of any modern president.
In 1981 Ronald Reagan laid out one of the clearest articulations of fiscal responsibility in his Inaugural Address: “You and I, as individuals, can, by borrowing, live beyond our means, but for only a limited period of time. Why, then, should we think that collectively, as a nation, we are not bound by that same limitation?”
The great irony of the Gipper was that he actually increased the deficit and federal spending in his administration. But he did so reluctantly, calculating correctly—in history’s eyes—that ramping up military spending would enable him to help end the Soviet Union and defeat communism.
But by the time Bush 41 was in office, his bipartisan deficit-reduction deal violated his prominent “no new taxes” pledge and consequently drew a crippling primary challenge in the form of Pat Buchanan’s conservative populist campaign.
Rather than whitewashing Reagan’s fiscal record, it is helpful to view it in full. Yes, he cut taxes dramatically, spurring the kind of economic activity that comes when the top rate is cut from 70 percent to 28 percent. But he closed loopholes and broadened the tax base—including raising Social Security taxes as part of a bipartisan fix—all actions that would get him attacked as a RINO today by the anti-tax crowd that idolizes him in the abstract. And don’t forget that Reagan presided over a rise in the debt ceiling some 17 times.
“
It’s a divide between the deficit hawks and the anti-tax absolutists.
”
The divided government of Clinton and Gingrich finally succeeded in turning the deficit into a brief, hard-won surplus as our economy boomed (after taxes were raised, spending was cut and the Internet appeared right on time).
But when George W. Bush took office, he squandered the surplus on tax cuts whose costs were compounded by two unfunded foreign wars and a growth in domestic discretionary spending that outpaced even LBJ. This pain-free approach was encouraged by Republican House leaders like Tom DeLay and others as a way to buy a “permanent majority.” This is when de-linkage occurred; as Vice President Cheney famously told first-term Treasury Secretary Paul O’Neill, “Deficits don’t matter.”
Contrary to contemporary myths, conservatives' support for Bush & Co. was not seriously diminished as a result of all this deficit spending. When Republican economists like Bruce Bartlett raised concerns about this de-linkage, they were drummed out of the party for disloyalty. The leading contemporary congressional critic of this spending spree was John McCain—and he was likewise derided as a RINO whose conservatism was questioned because of his principled independence. And when the Tea Party emerged in 2009, polls showed their members held an unseasonably high 70 percent approval for W., despite their anti-deficit, repudiate-the-past rhetoric.
Now we are in the middle of a great debate about debt ceilings and deficit reduction. Advocates of fiscal responsibility want to make the best and biggest deal possible—preferably a grand bargain that would raise the debt ceiling while agreeing to spending cuts, entitlement reforms, and—yes—some revenue increases, if not outright tax hikes. The all-or-nothing crowd is focused on an anti-tax litmus test, default be ****ed.
The obvious alternative—ripe for constructive compromise—is tax reform: close the loopholes that function as earmarks in the tax code and therefore raise revenue without raising tax rates. We might even be able to lower some rates as a result. This is what is called a win-win.
But anti-tax absolutists say that any revenues raised by closing-tax loopholes must be offset by further tax cuts, making them effectively deficit neutral. Professional activists like Grover Norquist hold a pledge and a primary threat over Republicans' heads. And this position is aided by prominent conservative populists like Michele Bachmann who parade under the Tea Party banner but are more focused on litmus-test politics than actually solving problems.
In contrast, Sen. Tom Coburn—who, on Monday, released a $9 trillion Black” plan that would cut spending dramatically, reform entitlements, and raise some revenues—has become an example of problem-solving politics that offers policy specifics.
And among the likely proposals that could come with a Plan B—being negotiated by Republican Senate Leader Mitch McConnell and Democratic Senate Leader Harry Reid—would be a binding bipartisan deficit-reduction panel that would likely pick up much of the plan forged by the Simpson-Bowles commission, itself a model of far-reaching fiscal responsibility.
It doesn’t take a presidential historian to notice that in recent years Republicans have cared most about deficits when there is a Democrat in the White House. And it doesn’t take an economist to know that our current fiscal path is unsustainable.
The irony is that reasserting the Republican tradition of fiscal responsibility could be exactly what the GOP needs to restore its lost moral authority on the generational theft that is deficits and debt.
Kepler
Si certus es dubita
Re: The 112th Congress: Debt ceiling edition
Coburn is an interesting case. Everyone in DC hates him, and he does display a lot of fuckwittedness and an enormous ego, but he's been one of the few sincere Republicans on this. He's wrong, but he's weirdly honest. Hence the desire by 99% of the GOP caucus that he be hit by a bus.
Coburn is an interesting case. Everyone in DC hates him, and he does display a lot of fuckwittedness and an enormous ego, but he's been one of the few sincere Republicans on this. He's wrong, but he's weirdly honest. Hence the desire by 99% of the GOP caucus that he be hit by a bus.
ScoobyDoo
NPC
Re: The 112th Congress: Debt ceiling edition
You'll never convince any Republican of that.
You'll never convince any Republican of that.
Kepler
Si certus es dubita
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Kepler
Si certus es dubita
Re: The 112th Congress: Debt ceiling edition
They're the same game, but ID just took the word "God" out (but still depends on theological, rather than rational, assumptions). After a while even a few True Believers had started to figure out Creationism was hooey, and they were never going to get it by the courts north of BFE Kansas, so they rebranded it.
"And the money kept rolling in."
They're the same game, but ID just took the word "God" out (but still depends on theological, rather than rational, assumptions). After a while even a few True Believers had started to figure out Creationism was hooey, and they were never going to get it by the courts north of BFE Kansas, so they rebranded it.
"And the money kept rolling in."
Last edited:
ScoobyDoo
NPC
Re: The 112th Congress: Debt ceiling edition
Yes, and anyone who falls anywhere on that graph will be voting against a debt ceiling increase.
Yes, and anyone who falls anywhere on that graph will be voting against a debt ceiling increase.
P
Priceless
Guest
Re: The 112th Congress: Debt ceiling edition
Looks like the deal floated by the "Gang of Six" might have legs. This ticks off extremists on both sides, so it might be worth considering.
GOP outrage
Democratic outrage
I suppose these should get NSFW labels, just in case
Looks like the deal floated by the "Gang of Six" might have legs. This ticks off extremists on both sides, so it might be worth considering.
GOP outrage
Democratic outrage
I suppose these should get NSFW labels, just in case
Kepler
Si certus es dubita
Re: The 112th Congress: Debt ceiling edition
No smiley needed. That's the sine qua non for a good policy.
This looks like kicking the can down the road, but since the debt ceiling vote should never have been linked to the budget battle, just pass it already.
This ticks off extremists on both sides, so it might be worth considering.
No smiley needed. That's the sine qua non for a good policy.
This looks like kicking the can down the road, but since the debt ceiling vote should never have been linked to the budget battle, just pass it already.
leswp1
Well-known member
Re: The 112th Congress: Debt ceiling edition
Heh. You really have a way with words!
Heh. I thought the same thing!
Re: The 112th Congress: Debt ceiling edition
Yes, that is how you know it is a good plan. Too bad it is coming so late in the process.
I love the extremeist comments on both sides, like for example, "I will never vote Republican again if they vote for this!" What are you going to vote, Democrat?
Looks like the deal floated by the "Gang of Six" might have legs. This ticks off extremists on both sides, so it might be worth considering.
GOP outrage
Democratic outrage
I suppose these should get NSFW labels, just in case
Yes, that is how you know it is a good plan. Too bad it is coming so late in the process.
I love the extremeist comments on both sides, like for example, "I will never vote Republican again if they vote for this!" What are you going to vote, Democrat?
Re: The 112th Congress: Debt ceiling edition
That plan seems to work IMHO, but strangely enough its going to need to attract more Dem support than Republican support in the House to pass. Of the 240 GOP'ers, how many will vote for a tax increase? Most of them are kneeling down before Grover Norquist and won't support net new revenues. I'd be surprised if The Boner can get 50 members of his caucus to support this. That means just about every one of the approx 195 Dems needs to support this plan.
That plan seems to work IMHO, but strangely enough its going to need to attract more Dem support than Republican support in the House to pass. Of the 240 GOP'ers, how many will vote for a tax increase? Most of them are kneeling down before Grover Norquist and won't support net new revenues. I'd be surprised if The Boner can get 50 members of his caucus to support this. That means just about every one of the approx 195 Dems needs to support this plan.
P
Priceless
Guest
Re: The 112th Congress: Debt ceiling edition
I fail to see how this works. It cuts taxes by $1.5T and reduces spending by $3.7T over 10 years. So, really only $2.2T. Except that that reduction in spending is a promise (and as we know, politicians always keep their promises) so it really only cuts $.5T, so it increases the debt by $1T. In 2021 the debt is expected to be "only" 70% of GDP (which it isn't even at yet). Oh, and this doesn't even raise the debt ceiling.
How is this a good idea? What am I missing?
I fail to see how this works. It cuts taxes by $1.5T and reduces spending by $3.7T over 10 years. So, really only $2.2T. Except that that reduction in spending is a promise (and as we know, politicians always keep their promises) so it really only cuts $.5T, so it increases the debt by $1T. In 2021 the debt is expected to be "only" 70% of GDP (which it isn't even at yet). Oh, and this doesn't even raise the debt ceiling.
How is this a good idea? What am I missing?
P
Priceless
Guest
Re: The 112th Congress: Debt ceiling edition
All 87 GOP freshmen have taken Grover's no new revenues pledge, and it is believed the group is well over 100 members, so any plan that raises revenues needs huge Democratic support to get through the House. But Simple Math (tm) tells me this actually cuts taxes by $1.5T, so the Groverites should be all over this idea.
All 87 GOP freshmen have taken Grover's no new revenues pledge, and it is believed the group is well over 100 members, so any plan that raises revenues needs huge Democratic support to get through the House. But Simple Math (tm) tells me this actually cuts taxes by $1.5T, so the Groverites should be all over this idea.
Kepler
Si certus es dubita
Re: The 112th Congress: Debt ceiling edition
The immediate problem is the GOP fracture in the House on raising the debt ceiling. This resolves it by giving the Wall Street Republicans political cover to vote with the Dems. The substantive good is that we miss August Armageddon. It buys them time for real budgetary reform down the road; everybody agrees the debt is getting out of control.
I'm inclined to agree with you that it provides very little real deficit savings, although if it cuts Social Security benefits by putting them on a less generous COLA schedule that might help significantly in the long run.
Politically, it gives the Tea Party caucus the ability to play holier than thou and vote against it even though they know it will pass. Rewarding them for kidnapping the world economy is certainly a bad precedent and no doubt they'll be even more prima donna in the near future. The Dems are willing to do it because (a) it's necessary to prevent disaster (we all knew the Dems would blink first), and (b) politically they are probably betting this will lead to an even more vocal split inside the GOP. The mainstream GOP wants to isolate the Tea Party -- it's a fifth column that risks the comfortable game they have played for years of running against the DC establishment while being part of the DC establishment.
The liberal rank and file are furious with Obama (again) for being a centrist (again) after running as a liberal. The Tea Party rank and file are furious with McConnell for not killing the hostages to show they are serious, with the 3 members of the GOP Gang of Six for folding under pressure, and just generally because they're angry all time anyway. But the Tea Party is a 34-year old right fielder with bad knees having a contract year: very powerful right now and useful for the stretch run, but depreciating every day.
Nobody wins big, but everybody (particularly the country) would have lost big if we had hit August without a deal. Each party has Spinmeisters who will claim this was a big victory during the election cycle.
The immediate problem is the GOP fracture in the House on raising the debt ceiling. This resolves it by giving the Wall Street Republicans political cover to vote with the Dems. The substantive good is that we miss August Armageddon. It buys them time for real budgetary reform down the road; everybody agrees the debt is getting out of control.
I'm inclined to agree with you that it provides very little real deficit savings, although if it cuts Social Security benefits by putting them on a less generous COLA schedule that might help significantly in the long run.
Politically, it gives the Tea Party caucus the ability to play holier than thou and vote against it even though they know it will pass. Rewarding them for kidnapping the world economy is certainly a bad precedent and no doubt they'll be even more prima donna in the near future. The Dems are willing to do it because (a) it's necessary to prevent disaster (we all knew the Dems would blink first), and (b) politically they are probably betting this will lead to an even more vocal split inside the GOP. The mainstream GOP wants to isolate the Tea Party -- it's a fifth column that risks the comfortable game they have played for years of running against the DC establishment while being part of the DC establishment.
The liberal rank and file are furious with Obama (again) for being a centrist (again) after running as a liberal. The Tea Party rank and file are furious with McConnell for not killing the hostages to show they are serious, with the 3 members of the GOP Gang of Six for folding under pressure, and just generally because they're angry all time anyway. But the Tea Party is a 34-year old right fielder with bad knees having a contract year: very powerful right now and useful for the stretch run, but depreciating every day.
Nobody wins big, but everybody (particularly the country) would have lost big if we had hit August without a deal. Each party has Spinmeisters who will claim this was a big victory during the election cycle.
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