26 Nov

Looking Over the Fiscal Cliff: What Kind of Deal is a Real Deal?

Clark S. Judge @ Hugh Hewitt:

The day after the election I found myself in a waiting room for television guests with Howard Dean, the former Democrat presidential candidate. Passing the time, Dean talked and I listened. The topic was the fiscal cliff. Dean was for going over it and forcing the big increases in marginal tax rates that will go with such a move. “I am a deficit hawk,” he said. “That’s the only way to get a deal.”

Well, there are deals and there are deals.

From the Reagan through the Clinton years, Washington had a paradymic budget deal: lower tax rates to satisfy Republicans; promised decreases but actual increases, though not as much as they wanted, in domestic sending to satisfy Democrats. It was a game, with set rules, the two sides starting with the same offers, year after year, and in most years coming out in roughly the same place. When George H.W. Bush violated the rules and gave up on tax rate reductions with barely a fight or explanation, he lost the next election.

But then came George W. Bush’s tenure during which, despite a Republican Congress for six years, domestic spending shot up, followed by the early Obama years, when, with all Congress in Democrat hands, spending really took off. One political result coming out of the 2010 elections was a GOP House of Representatives, which started trying to draw the spending line. Another was Democrats like Dean posing as deficits cutters while refusing to identify any significant spending reductions outside of national security that they would accept. Tax the rich is all they could say, which was all the media needed to hear to keep hailing them for their statesmanship.

Now, the president and the media are pushing to end the old game for good – except that where they want to take us makes no sense, even in their own terms. During the last election, Mr. Obama’s position on our deficit crisis came down to 1) more domestic spending, even radically more, 2) don’t touch entitlements, 3) tax the rich.

And so, with spending now at 25% of GDP and, according to the Congressional Budget Office, headed to 46% of GDP by 2050 even if there is not a single addition to the list of government programs, the only action that the president has said we need is to up the very taxes that are most destructive to economic growth. Maybe you can find someone who believes the deficit can be closed without strong economic growth. I’ve never found such a person.

Read more

       

About Curt

Curt served in the Marine Corps for four years and has been a law enforcement officer in Los Angeles for the last 20 years.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>