Jun 08 2006
“Stoking the Beast”
There’s an interesting article in June’s Atlantic. Although it prophesies the death of Roe v. Wade in big letters on the cover, the more realistic and interesting discussion is just inside. By “just inside”, I mean past the first 25 pages that are drowning in advertisements and smother the otherwise greatly entertaining Calendar.
The article is by Jonathan Rauch, the Atlantic’s introvert-in-chief, and a Brookings Institution name, and it has a single point that it delivers with impressive force: cutting taxes to “starve” the government has consistantly lead to an expansion of government.
In the Atlantic’s true “Don’t believe me — try this on for size!” style, there are a bunch of juicy numbers and historical defenses for this basis. The big one for me is this: over the last 25 years, a tax cut of 1% of the GDP corresponds directly to an increase in spending of about 0.15% of the GDP. Better yet, an equivalent tax hike of has corresponded to an equivalent decrease of about the same amount.
This isn’t hypothetical nonsense about what might happen — these are hard and fast numbers looking at the correlation between tax cuts and spending over the last 25 years, and they’re already controlled for unemployment (the biggest third variable in this equation). The reality is that, in our current climate, it seems like raising taxes corresponds directly to shrinking government. I buy this, although for reasons other than Rauch’s. I think that people who raise taxes have their fiscal policies consistantly coming under heat — after all, if you’re raising taxes, you must be spending wildly!! However, people who cut taxes are assumed to be fiscally responsible and in control of government growth, which has been demonstrably false.
And here’s the quote that I love.
…for the modern conservative coalition, the implications of his findings are discomforting, and in a sense tragic.
…the most effective constraint of all is to raise taxes and cut spending: exactly the sort of anti-deficit package that anti-tax conservatives pummeled the first President Bush and President Clinton for approving, and exactly the sort of package that the current President BUsh and his anti-tax allies are sworn to block.
Any disenfranchised conservative should already have a subscription to the Atlantic, and if they don’t have one, this is a good month to start. Any liberal who wants to try to win over the fiscal conservatives should read this article, too.
Popularity: 2% [?]
Over the last 25 years, most of the tax cuts were made by borrow and spend Republicans.
There are two theories here. The first is that, when confronted by the enormous temptation of actual control of the budget, the Republicans forgot their vows of poverty- especially in the face of being able to give money to their friends.
The other theory is that it’s delibert. They actually do try to cut spending on a regular basis. Unfortunately, the spending the Republicans really want to cut are generally widely popular- for example, Social Security or Medicaid. People don’t like it when the goverment cuts these programs. So the idea here is to make cutting these programs not optional- run the debt up to the point where the alternatives are cutting the popular programs, or fiscal apocaplyse.
Of course, the problem with playing chicken is knowing when to swerve. I’m not at all sure that the warning signs of impending fiscal apocalypse will be clear enough, unambiguous enough, and early enough to do any good. Instead, I think it is much more likely we’ll just wake up one day to discover the US goverment having to default on it’s debt and devalue it’s currency, at which point it’ll be way, way too late.
So take your pick: are Republicans simply so weak willed and corrupt they can’t say no to pork, or are they are so evil that they will destroy the goverment in order to cut popular programs. Your call.