Does Deficit Talk Hurt Progressives?

While sifting through talk about Bush's budget today, I have been unable to avoid a question that keeps popping up in my mind: is talking about the deficit good politics for progressives and Democrats?

When it comes to Bush, we talk about the deficit quite a bit. For example, Senator Reid's office put out this release:

The Presidentıs Plan Adds Over $4.5 Trillion in Debt. ³Over the first ten years that the plan actually was in effect (2009-18), it would add more than $1 trillion to the debt. Over the next ten years (2019- 28), it would add over $3.5 trillion more to the debt. All told, the plan would add more than $4.5 trillion to the debt over its first 20 years.² [Center on Budget and Policy Priorities, ³New Details Indicate Administration Social Security Plan,² 2/2/05] http://www.cbpp.org/2-2-05socsec4.htm
Via NPR, Kos notes:
NPR reports that these budget cuts amount to 6 percent of the deficit. The tax cuts, on the other hand, make up 50 percent of the deficit.
This is just a sampling from today. More famous instances include the winning ad in MoveOn.org's Bush in Thirty Seconds contest, Howard Dean's repeated insistance on balanced budgets during his Presidential run, and Kerry's repeated insistence throughout the campaign that Bush had an enormous budget surplus but he turned it into an enormous budget deficit.

Needless to say, we have come to talk about the deficit--a lot. My worry is that our continued harping on the budget deficit not only gains us nothing, but actually enables conservatives because it allows people to think like conservatives in other ways. Here are my complaints in the form of bullet points:

  • Talking about the enormous budget deficit reinforces the idea that government must be made smaller, no matter what programs are cut.

  • Talking about it from a government waste frame--that spending money on interest payments is a poor use of tax dollars--is inherently conservative.

  • Talking about it in our favorite frame, as a "birth tax," not only bestows legitimacy upon the Republican "death tax" frame for the estate tax, but also bestows legitimacy upon the idea that all taxes are bad no matter what programs they support.

  • The deficit, whether real or not, is always an abstraction. To talk about abstract economic problems during times when many people are facing real problems making ends meet dehumanizes our economic policy. After all, how are we helping people by balancing the budget? Perhaps just as importantly, how can we convince people we are helping them by balancing the budget?
What am I missing? Is there a good way to talk about the deficit? What do we gain by talking about the deficit? Someone is going to have to help me on this front, because I can't see anything positive coming from it at all. Enlighten me.



Display:


Agreed (none / 0)

I can understand the impulse to attack the Republicans with the club with which they beat us over the head, but then we are arguing like conservatives.  I don't have an alternative frame ready for use, but it's clear that the problems with the deficis are numerous:  the amount of $ that will go towards paying the interest, not to mention the principle; crating a deficit by giving money to the wealthy, and not using money to invest in things that will improve the lives of the less well off and increasing economic productivity.  Finally, such spending is unsustainable. But does that mean taht we should insist on balanced budgets?
   I think that what's happened is that the conservatives made balanced budget a symbol, a powerful symbol of discipline and restraint.  We haven't learned how to argue for a smart budget in terms of our values.

by KDMfromPhila on Mon Feb 07, 2005 at 03:45:28 PM EST

Re: Agreed (none / 0)

A smart budget for our values would be one for the people.
by yitbos96bb on Mon Feb 07, 2005 at 03:49:15 PM EST
[ Parent ]

Depends... (3.00 / 1)

It is hard to fight this while looking at conservatism as a whole, because frankly there is no Black and While conservatism any more.  The old school conservatives are a small number and have been replaced by the neo-cons of today. To me the Neo-Cons are the true enemy.  But I digress.

You call the Government Waste Frame a conservative notion...and in the past it was an old school conservative notion.  However, with the new breed of Neo-Con, this is no longer a conservative topic.  The status-quo is to carry a deficit.  The progressive response in changing the status quo is to lower the deficit.

I would frame it as the fiscal responsibility of putting the people's money back to work for them.  This allows us to cut some of the pork programs and insane "bigger than the rest of the world combined" war budget and put it into the programs.  It isn't cutting programs, but a redistribution of the wealth.  For instance, cut some of the high tech military research budget and use it for armor etc, soldier benefits and higher pay.  We need to see fiscal responsibility not as only a monetary issue, but as a moral values issue...We choose to not give your money to businesses and other BS.  We choose to use it on programs to enhance your life, and improve your children's future.

by yitbos96bb on Mon Feb 07, 2005 at 03:48:01 PM EST

Re: Depends... (none / 0)

We need to see fiscal responsibility not as only a monetary issue, but as a moral values issue

That's the most important point. Responsible leaders are good stewards of the nation's Treasury and public resources.  Irresponsible leaders are not good stewards. By introducing massive debts -  through unwise tax cuts and unwise spending - irresponsible leaders put at risk the nation's ability to pay for its most essential needs: a military that is in good shape to defend the nation; programs that keep Americans out of poverty, such as Social Security and Medicare; and the crucial investments in research, education, and infrastructure upon which our country's economy relies.

Keep it short. DemocraticShortList.com
by Rob in Vermont on Mon Feb 07, 2005 at 04:50:47 PM EST
[ Parent ]

Re: Depends... (none / 0)

Really ... it depends ???

The deficits have to be discussed TODAY and they have to be discussed in terms of the Bush budget.

The issue has to be framed in terms of the constituency which will respond to the Democratic message. See the quote articles below I posted from Dean (constituency "the middle class" "wealth redistributed upward") and another from Pelosi ("Bush budget a hoax" "balanced on the backs of the needy").

Where the democrats fall down is on party unity and vote around the message and the response.

I also see that a lot of peope here still do not realize how a minority party has to operate, that is with a unifying vision, a unified message in response and with as much unity as can be enforced on votes in congress by the leadership.

Democrat members who do not fall in line must be punished, there is no other way to deal with the situation, large issue and vote or small. We are no longer a majority party which can afford to have members going their own way in what they believe is their own electoral best interest.

If you think there is a way around this you are mistaken.

by leschwartz on Mon Feb 07, 2005 at 08:19:02 PM EST
[ Parent ]

National credit card (none / 0)

I think that might be an easier concept to get into people's heads.  with the size and complexity of the budget, it's easy for fiscal responsibility to become obscured and twisted by the R's--they'll just say we want to raise taxes because "it's in our genes" or some other crap.  or it becomes an argument about plan details that people tune out.

everybody understands what credit card debt means, and it would equate the R's with credit card companies (which should be the case anyway)

by benchcoat on Mon Feb 07, 2005 at 08:52:10 PM EST
[ Parent ]

Balancing the Budget (none / 0)

There are always two ways to balance any budget - reduce spending or increase income.  The major problem with Bush is his insistence on cutting the government's income to the bone, refusing to ever reconsider those cuts, and to a much lesser degree, his refusal to consider cutting back on the areas where discretionary spending is the greatest.  Those areas are the military, Iraq, and interest on the debt.  So, I don't believe Democrats should keep quiet about the deficit, but should continually bring up the ill conceived tax cuts for the wealthy and the waste in Iraq, and on military hardware of highly questionable value.  To do otherwise would be unpatriotic in my opinion.
by Sacramentohop on Mon Feb 07, 2005 at 03:50:01 PM EST

Re: Balancing the Budget (none / 0)

Yeah but we only outspend the rest of the world combined on Defense...Is it really enough...Maybe we need to triple that...we can goldplate the tanks and hummers.  

(Note the sarcasm to those who can't see it sometimes.)

by yitbos96bb on Tue Feb 08, 2005 at 12:36:48 PM EST
[ Parent ]

disagree (none / 0)

"Talking about the enormous budget deficit reinforces the idea that government must be made smaller, no matter what programs are cut."

Talking about the deficit problem doesn't
imply a smaller government, what it implies
is that we as a society must pay for needed
services and social investments, and everyone
ought to pay their fair share.  

PAYGO:
Pay as you go.

It's the corporate elite that is evading their
responsibility of paying their fair share.  They earn huge benefits from their position in society, they ought to pay the largest share.

by aenglish on Mon Feb 07, 2005 at 03:58:18 PM EST

reform = responsibility (3.00 / 1)

to communities, to people who work hard and play by the rules, to transparency and honesty in government. . .

There's absolutely no reason the deficit issue cannot be framed within our expressed values, for example, using Dean's DNC candidate speech.

I don't see the need to worry, hris, but I'm glad you're on the lookout.

by Pachacutec on Mon Feb 07, 2005 at 04:54:05 PM EST
[ Parent ]

How about this (none / 0)

I think our attack should be to use the deficit to call Bush's tax cuts dishonest.  

If I go to a bank and get a $10,000 home equity loan, I have not gotten $10,000 richer.  This is exactly equivalent to the Bush tax cuts.  They are paid for entirely by borrowing.

They are not tax cuts, they are tax deferments.  

by snaktime on Mon Feb 07, 2005 at 04:05:46 PM EST

Re: How about this (none / 0)

I think this is the right idea.  We can reframe the issue by comparing Democrat tax hikes to Republican tax hikes.  We emphasize the difference that the Democrat taxes are more responsible because we don't have to pay compounded interest on them years down the road.  But if we start calling the bush tax cuts a "tax hike" then at least that puts us on equal footing.
by BBigJ on Mon Feb 07, 2005 at 04:40:50 PM EST
[ Parent ]

We Need to Remind Them of Deficite (none / 0)

but we can do it positively:

Progressives pay our bills and honor our committments.

by seajane on Mon Feb 07, 2005 at 04:08:36 PM EST

A new frame is irrelevant at this point (none / 0)

If and when Democrats get the opportunity to make decisions on federal spending when can worry about a new frame at that time. I've never been impressed with the "birth tax" idea, but now we can use it against Bush.

The massive deficits Bush is running will "starve the beast" to the point that it won't matter what frame we use. Deficit spending will be so far in the red, we won't be able to afford new programs. The priority right now is to head off an extension of Bush's tax cuts. The Republican frame can be effective because it's their frame.

How about Newt Gingrich for a frame? Bush is quoting Democrats, so I'd run Newt and everything he said right up their posterior. I'd run Proxmire's Golden Fleece Award and all of the fiscal conservative statements that they used to complain about the deficit.

Democrats can't stop Bush's tax cuts. We need help from fiscal conservative Republicans. The best frame to use against Bush are frames that appeal to Republicans. I briefly looked for numbers on the interest payments on the national debt this weekend. They are holding steady at about $300+ billion/yr. because interest rates are so low.

If Bush's deficit spending goes up to $600 or $700 billion per year, plus interest payments of $500 or $600 billion/yr., depending on interest rates, plus unfunded liabilities from Medicare, we've got one hell of a big hole. Then add a $600 billion/yr. trade deficit.

I've heard deficits talked about in terms of investment in our infrastructure and investment in people. We can talk about seed money for the future. We can cross that bridge when we come to it. Right now, Bush's deficit is not creating jobs or investing in infrastructure. Whatever we say or do is fine.

We can also demonize the fiscal recklessness of Bush and Congress so they can't use the deficit against us in the future. Keynesian deficits can stimulate the economy if they are invested in infrastructure of productive uses.

by Gary Boatwright on Mon Feb 07, 2005 at 04:12:41 PM EST

Re: A new frame is irrelevant at this point (none / 0)

Seriously, if we can re-frame deficits to be seen as a conservative value, and make a balanced budget a progressive idea, I think we can win.
by yitbos96bb on Tue Feb 08, 2005 at 12:38:54 PM EST
[ Parent ]

Smaller Deficit != Smaller Government (none / 0)

The two are simply not the same.
by Chris Andersen on Mon Feb 07, 2005 at 04:14:51 PM EST

how bout.. (none / 0)

Try talking about deficits as a cheap substitute for real investment.

"Our nation is running on empty, we aren't investing enough in our infrastructure.  The deterioration is already showing, if you know where to look.  The Republicans want you to believe that borrowing money is just as good as real infrastructure-building.  It's not, because it's borrowed infrastructure - it can't last."

by joshyelon on Mon Feb 07, 2005 at 04:17:53 PM EST

while I'm at it... (none / 0)

"Our factories are running on borrowed coal.  Our infrastructure doesn't belong to us.  We need to build our own economy, build our own infrastructure.  This borrowing is giving the illusion of a functioning economy, but it's not our economy - it's a little slice of China's economy, imported over here.  The republicans do it this way because for a brief moment, it makes us look wealthy.  But it's illusory.  The only way to real strength is to build our own.
by joshyelon on Mon Feb 07, 2005 at 04:30:30 PM EST
[ Parent ]

Re: while I'm at it... (none / 0)

why not throw in national security, too?  Deficit spending means we have to "ask permission" from our creditors (and more potential creditors) in order to pay for our military.  

I've used this argument with a hawkish guy at work who has some neo-connish views:  he thinks we should be invade Syria and Iran in order to establish a democratic Middle East.  when I asked him how we would do that if Japan or China didn't want to loan us the money, he just got blustery and incoherent.

by benchcoat on Mon Feb 07, 2005 at 11:40:48 PM EST
[ Parent ]

How about: (none / 0)

By not taxing the rich and corporation (corporate taxes are at their lowest levels since the late 1920s except for one year 1983) budget deficits go up, the tax burden is shifted to middle and lower class people causing average Americans to have less desposable income and thus causing consumer spending to slow and economic growth to stagnat.
Councilman Bill Painter
by Painter2004 on Mon Feb 07, 2005 at 04:25:56 PM EST

Its about responsibility (none / 0)

Grown-ups pay their bills. They don't spend more then they take in. I think it can be turned around by asking Republicans why we shouldn't just eliminate all taxes. If government is so wasteful, lets just shut it down. Who needs the military or schools, or roads, or social security, or the CDC? Make them argue our side of it. Of course, this gets into the more basic argurment that progressives need to make--that we are stronger when we pool our money. Republicans think we are stronger when we act independently and selfishly. Democrats think we should work together. Government is just the organizational system that lets us pool our economic power. By pooling our money, we can do amazing things like build the worlds greatest military and provide education for all with relatively little cost. If we agree that these are good things to do, we need to agree to pay for them.
by TJonBergman on Mon Feb 07, 2005 at 04:36:13 PM EST

Good. (none / 0)

I like this frame. Everyone knows that working together will lead to greater benefits (Two heads...) If we can frame it so it's a progressive notion, then we can succeed.

I know, it's getting close to communism, communal, blah blah. But we just have to be careful.

by wazdog on Mon Feb 07, 2005 at 06:42:47 PM EST
[ Parent ]

Re: Its about responsibility (none / 0)

I'm not entirely sure this approach will work--I think Republicans won't start arguing our point about mutual strength when presented with this argument.  I think they will instead see it as a chance to soapbox about welfare and any anecdotes of government waste that they know.  I think you should get your own frame established first, so they must argue on your ground.
by benchcoat on Mon Feb 07, 2005 at 11:52:32 PM EST
[ Parent ]

Credit Card Debt (3.00 / 1)

Middle class Americans are struggling to come up with the minimum payment on their credit cards while interest on their debt piles up. Unfortunately, people are learning first-hand the consequences of spending money they don't have. It's not an abstraction--it's all too real.
by Super G on Mon Feb 07, 2005 at 04:37:50 PM EST

Social and economic issues are related (none / 0)

I definitely see the point you are making here.  Talking about the deficit seems like it’s pretty old hat these days.  It’s something that we as democrats have been complaining about since basically Reagan came to office and since the sky hasn’t fallen yet it’s starting to look like a knee-jerk reaction that no one needs to really be worried about.  Plus, deficit spending by itself it’s a particularly conservative or republican thing (although it does often seem like it), and there are certainly circumstances as a liberal where I would find it important and necessary to do so.

In that vein, perhaps the way to reframe the argument is to call for a return to an economy of the people, for the people.  Go straight for their nuts on it and run candidates who will point out that America is being run by people who are promising moral social reforms that they can’t (and shouldn’t) deliver so that they can reap the lions share of our collective cake.  They cut their taxes and tell us that it’s good for us, while screaming that homosexuals are trying to destroy marriage.  They raise the deficit and blame social programs as if poor unwed mothers are walking away with billion dollar defense contracts.  They send their kids to private schools and colleges while demanding vouchers, and claim that atheist and Jews who won’t let you pray in school that is wrecking American education and morality.  They act like a guy who makes 10 million a year is merely working 500 times harder per week then a guy making 20000 so that they should be taxed at about the same rate so that they guy making 20000 a year will get his shit together.  It’s bulshit, and we know it, but we need to connect the two things better perhaps?

"Ignorance, the root and stem of all evil."... Plato
by Spartacus on Mon Feb 07, 2005 at 04:52:18 PM EST

No Social Justice w/out a Balanced Budget (none / 0)

As Dean says, There can be no social justice without a balanced budget...

Talking about the deficit works for several reasons:

  1. It removes the tax and spend label from the Democrats.

  2. For every social program to be gutted there is a corporate welfare program to be gutted.

  3. The best "tax break" the middle class ever got is low interest rates:  home ownership, cheap small business financing.  Simple economics:  continue deficit spending and low interest rates are gone.

  4. There can be no social justice... until we present a balanced budget, the conservatives will harp on welfare cheats, etc. using the deficit as an excuse.  We can win the "keep more of your money argument" because, as the Soc Sec debate is showing, Americans want to be socially responsible, but they have to feel fiscally responsible first.

  5. There's votes to be had-- 19% of the electorate felt strongly enough about this issue to vote for Ross Perot, who is a nutcase.  A Dem with solid balanced budget credentials (like Dean, maybe Warner) could gain a few crucial points with this bloc.

If I were the Democratic Pres. with an R congress, I'd submit a balanced budget.   Cut the shit out of everything.  And play a little game of political chicken.
Would you hire George W Bush to be YOUR latex salesman?
by jgkojak on Mon Feb 07, 2005 at 04:59:54 PM EST

I disagree (2.00 / 1)

and to be honest, Dean's insistence on this during the primary was one of the main reasons I personally hesitated to support him.

While I agree with certain of your points, I don't think that balancing the budget will cure many of these ills- it didn't in the 90s.  The conservatives continued to howl about welfare cheats, etc. when they didn't have a deficit to use as an excuse.

A deficit such as the one that FDR faced after WWII was justifiable.  And if investment in infrastructure or the GI bill or something of that ilk causes a deficit, well, so be it.  If we go into a recession, and tax income goes down while government payments go up, we'll have a deficit.  I think that deficit is justified, and without it, we certainly wouldn't have social justice.

The deficit is a serious problem for international trade (check out the "Dollar Dump" diaries on Kos for more info) not so much because we have one (and a doozy at that) but because we show no signs of working toward a sensible reduction of that deficit.  

That said, I do not think that Bush's wildly irresponsible tax cuts and war are justifiable reasons for the kind of deficits we're running.   I think we can use the deficit, to our benefit, as one of the many side effects of Bush's disastrous policies.  I would hesitate to use it as an issue in and of itself, for the reasons outlined by Chris above, and because I think some deficits are acceptable.

I do like Dean's "borrow and spend" label for the Republicans.  

by Chicago Lulu on Mon Feb 07, 2005 at 06:12:25 PM EST
[ Parent ]

Connect the disconnect (none / 0)

A huge chunk of middle/working/lower class America was sold on tax cuts for the rich, because they got a tax cut too. Giving everyone tax cuts seems fair, and giving those that pay the most, the biggest cut doesn't seem unreasonable. Why be jealous of someone else's good fortune, when you have been fortunate yourself? There is NO victim from tax cuts alone.

We need to connect tax cuts for the rich with social program cuts for America.

In a conservative budget the rich pay less in taxes than anytime since 19?? (im not sure of the date, but its a damn long time ago), and community policing gets cut by 80%. Heating oil for the poor gets cut by $200 million, as oil prices go up. Fire department aid is getting slashed by 30%. It goes on and on. The necessities of America are getting slashed.

I was watching crossfire (eee, a rare pastime), and I thought that the democratic argument sounded much stronger. If we say "tax cuts for the rich" everytime we mention budget, regular people will see the connection.

Bush's spending cuts are a golden opportunity to crush the republicans with their own ideology. Tax cuts for the rich in order to shaft the poor is the ugliest part of the "Ownership Society" ideology. Its the part we can win.

When they want to let people open private accounts with social security taxes, they have the upper hand, and we are left playing defense. When they want to cut social programs that people rely on, we gain the upper hand. This budget proposal may be best opportunity to take an axe to the unpopular underbelly of the Ownership Society.

You know the word association games pollsters like to do? We should aim to associate "low taxes on the rich" with "social spending cuts." We must assign a cause for the problem the Bush's budgetseeks to address. Republicans will try to reframe it, as a causeless happenstance, and now we must all sacrafice a little for our children's sake.

If we can conflate regressive tax cuts with social cuts, we win.

by srolle on Mon Feb 07, 2005 at 05:07:46 PM EST

RE-FRAME in terms of a constituency who will vote (none / 0)

on this issue.

This can only be done with research.

Any of the above points could be a part of a democratic narrative, but the democratic party must use the opportunity to vote on the Bush budget as an opportunity to present what they stand for in a united way.

The democratic party does not present a consistent message and it does not enforce parlimentary discipline.

As a minority party which can not bring bills to the floor for a vote, the democratic party must reframe the issue around a real constituency that will vote on the issue, it must provide a consistent member by member front and a disciplined vote in congress consistent with their vision.

I think the issue can be reframed in terms of jobs and the need to have affordable money to expand business, and that the Bush economic policies have failed. Clinton's approach closed the budget deficit and created 22 million new jobs, and every GOP member in congress voted against it.

But Democrats have not used this frame and they have allowed the GOP lies about a "booming" Bush economy to go without a response. Statistics about un-employment are a lie as well.

The Bush budget also does not cover the war costs either this should be a cause for concern by the entire political spectrum.

The Bush budget steals from the poor with budgets cuts for the most needy and gives to the wealthy with tax cuts that are regressive and favor the rich.

 

by leschwartz on Mon Feb 07, 2005 at 05:18:07 PM EST

Re: RE-FRAME in terms of a constituency who will v (none / 0)

http://www.democracyforamerica.com/features/2005/02/07/middle_class_hurt_by_bushs_values.php

Middle Class Hurt by Bush's Values

By Gov. Howard Dean, M.D.
This is one in a series of weekly syndicated columns written by Governor Howard Dean.

Ever since the purveyors of conventional wisdom pronounced that the last election was about moral values, the beltway pundits have been endlessly engaged in trying to divine What It All Means. After all, President Bush presented himself as the embodiment of compassion and American values, and has told us that the election was his accountability moment--proof positive that the American people support his policy priorities.

The simple truth is, however, that it did not take an election to convince us that the American people are a deeply moral people. When we see children pool their pennies to help tsunami victims, or a community unite to pay for a neighbor's transplant operation--that is all the evidence of compassion we need.

With the State of the Union Address and the annual budget submission, President Bush will have his opportunity to unveil the most tangible statements of his priorities and values. These two documents are a distillation of hundreds of choices made and priorities ordered. It will be interesting to see what he chooses.

Because in the course of making thousands of decisions that impact the real lives of Americans, one decision that the President made has impacted virtually all others, and that was the decision to completely change the structure of our economy by dramatically shifting the tax burden from corporate interests and wealthiest individuals squarely onto the middle class. That decision has put our nation in a financial straightjacket for generations to come.

... continues ...

by leschwartz on Mon Feb 07, 2005 at 05:50:07 PM EST
[ Parent ]

Re: RE-FRAME in terms of a constituency who will v (none / 0)

http://story.news.yahoo.com/news?tmpl=story&cid=584&e=1&u=/nm/20050207/pl_nm/budget_cong ress_dc

Bush Faces Fight with Congress Over Spending Cuts

 top snipped ...(gop comments)...

 DEMOCRATS ANGRY

Democrats balked at Bush's plans to slash spending in some areas such as a popular community police programs. They also slammed his deficit forecasts for being misleading for leaving out the cost of military operations in Iraq (news - web sites) and Afghanistan (news - web sites) or any potential costs of his plan to reform social security.

"The president's budget is a hoax on the American people," said House Democratic Leader Nancy Pelosi of California.

"The two issues that dominated the president's State of the Union Address -- Iraq and Social Security (news - web sites) -- are nowhere to be found in this budget."

The White House is forecasting a third straight record fiscal shortfall of $427 billion this year, including war costs. The deficit will shrink to $251 billion in 2008, according to Bush's plan, but this is without spending on Iraq and Afghanistan or social security.

Democrats blame Bush's tax cuts for turning the budget surplus he inherited from President Bill Clinton (news - web sites) into a record shortfall and creating the need for budget cuts today.

"To help pay for its tax cuts and costly new proposals, the administration cuts critical investments in areas including health, education, veterans' services, environmental protection, and community development," said South Carolina Democrat Rep. John Spratt (news, bio, voting record).

Bush included in his plan ways to squeeze $45 billion in savings from the Medicaid health program for the poor. Medicaid is one of the automatic programs that make up the largest chunk of the federal budget.

These do not require Congressional approval each year which means that Bush cannot force Congress to do what he wants on these programs by threatening or using a veto.

"Some of the savings that appear substantial in the budget may not happen if Congress isn't in the mood to tackle entitlements," said Bixby.

end

by leschwartz on Mon Feb 07, 2005 at 06:01:14 PM EST
[ Parent ]

Fiscal Responsibility (none / 0)

If I may turn the question around for you, what do we have to gain by talking about higher taxes? Post-Clinton, I don't even think its possible to talk about increasing government funding for anything other than homeland security. He is the one who said that the era of Big Government is over, effectively conceding the battle to the Republicans. So they have already won on this issue, or at least they have won in the way that we think about government spending.

In this climate, it makes no sense to talk generically about government spending in a New Deal or Great Society kind of way, because it will immediately get tagged as impractical government waste. Part of the reason is that progressives haven't ever needed to point out the value of social programs, so they aren't in the habit of doing that. When social programs are attacked, the response is almost always very abstract, supporting the general idea of government helping out those who can't help themselves, but never really focusing on practical, measurable realities, and I think people really want to see that. For example, just today I read that social security cut poverty among the elderly by more than half since 1959. That something that tax-payers can feel proud of, but Democrats don't seem to be emphasizing the bang you get for your tax dollar. Instead, there's a lot of idealism and general support for government programs, but that doesn't play all that well anymore.

Social programs should be presented as investments in society and should highlight the return on the investments that we make in real numbers. The tax-payer feels good because they feel that the programs are effective, and they also feel good that politicians are keeping tabs on these things and being good stewards of tax revenue, and talking about keeping down the deficit is part of being a good steward. We should also avoid talking abstractly about government spending, and always talk concretely about spending X dollars to achieve results Y and Z.

Progressives are very vulnerable to the "Redistribution of wealth" charge, and to avoid that label, we need to generate broad support for social programs.

by MrOnion on Mon Feb 07, 2005 at 05:19:40 PM EST

Deficits (3.00 / 1)

As Brad DeLong says:

Short-term countercyclical deficits when unemployment is high are good: they boost employment and production, keep the economy from falling further into recession, and make us a richer society. Moreover, confidence that the government will act to stabilize the economy reduces risk, raises investment, and helps long-run growth.

Long-term structural deficits, however are bad: they drain the pool of savings that businesses rely on to fund investment spending, reduce the stock of productive capital, and slow economic growth.

The best policy has substantial short-run deficits when unemployment is relatively high, but substantial surpluses on average over the business cycle.

I would add that when the long-term structural deficits are used to finance the conspicuous consumption of the rich instead of growth-generating public investment, then we have the worst of both worlds.

The negative economic effects of long-term deficits are real: macroeconomists believe that every 1% of GDP in the long-term structural budget deficit will raise long-term interest rates by 0.3 points. The consequences, Professor DeLong?

If you run a 4% of GDP deficit for the next decade--as in, say, the Bush administration post-2009 baseline numbers . . . you are likely to push up interest rates by 4 x .03% x 10 = 1.2%. . . .push up the debt-to-GDP ratio by 40% . . . push down the county's capital stock by 14.4%, and make the country 4.8% poorer.

That's $574 billion, nearly $2,000 for every man, woman, and child in America. That's real -- nothing abstract about it.

So there is no question that we need some long-term deficit reduction. But how much is enough? According to the Congressional Budget Office (via The Economic Policy Institute's Max Sawicky):

Sustainable policies do not require balanced budgets. As long as deficits do not grow relative to the economy, the government could in principle keep the budget in deficit forever. . . if the government stabilized the . . . deficit at its current [1997] share of GDP (about 1.7 percent), the debt would remain close to its current share of GDP indefinitely.

So a sustainable budget policy does not necesaarily mean "zero deficit," as DeLong implied, but rather a deficit that does not over time increase the national debt-to-GDP ratio. This leaves more room for public investment and social spending.

According to Max, we ought to balance the benefits of deficit reduction in terms of lower interest rates and higher national savings against the costs of lower public investment and social spending:

Moderate deficit levels are tolerable for an indefinite period of time. . . . If deficits are tolerable, would we still profit from eliminating them altogether? . . .  deficit reduction implies some sacrifice in public benefits and services, including public investment, itself an essential component of economic growth.

In sum, I think we are more than justified in talking about the Bush budgets as being "unsustainable budget policy" because

  1. They increase the national debt faster than our ability to pay back that debt; and,

  2. The Bush deficits are not being used to finance productive public investment or public services, but rather the wasteful consumption of the rich.

Why this is "inherently conservative" is beyond me. If liberals plan to use active government to do good things, we had damn well also better be in favor of taking scrupulous care of the money that American citizens entrust to us.

Note this does NOT mean we need to advocate a policy of permanently balanced budgets.

by tgeraghty on Mon Feb 07, 2005 at 05:20:50 PM EST

Re: Deficits (none / 0)

These are the facts. How you frame them depends on who you are appealing to. Most of the frames I've seen so far are trying to appeal to liberals or Dems. Shouldn't we be appealing to fiscal conservatives to stop the extension of Bush's tax cuts?

Unless the small fiscal conservative Republican caucus (I've heard rumors) steps up to the plate our economy is screwed, because Dems may not be able to stop Bush's tax cuts by themselves. There's a very good reason Bush's 2005 budget doesn't include extending his tax cuts.

Zigzag's diary laid out the problem. With a ten or eleven trillion dollar national debt the interest payments would be between $700 billion and a trillion dollars per year. It depends on what happens to interest rates in the next ten years.

I think one trillion dollars a year for interest on the national debt is a problem for Dems and GOPers. It would also be a problem for foreign banks who purchase our debt. We are facing a fiscal meltdown. The Bush/Cheney/starve the beasters are the ones that don't care about deficits. Dems have to work with the fiscal conservatives on the other side of the aisle on this issue. If we can pull enough fiscal conservatives over, our economy has a chance.

by Gary Boatwright on Mon Feb 07, 2005 at 06:54:08 PM EST
[ Parent ]

Re: Deficits (none / 0)

A new diary just popped up that explains our opportunity very well, Deficits-Our Ticket to a Majority. Dems need to remind voters of Clinton's surplus over and over and over. Bush's deficits could easily split the Republican party into pieces. We want to hammer Bush on irresponsible deficit spending. Make him explain why deficits don't matter.

Tie in his jobs promises. Where's the job growth we were supposed to get from tax cuts? We can hammer Bush a half dozen different ways from Sunday on deficits and we should do it loud and often. Let's worry about framing our deficits when we have something to say about it and somebody cares.

by Gary Boatwright on Mon Feb 07, 2005 at 07:03:26 PM EST
[ Parent ]

Checkmate -- (none / 0)

That was their game plan.  

  1.  scratch head and try to figure out how to get rid of EPA, social security, NEA, NSF, NPR, etc. -- because of their inherent liberal bias.

  2.  Spend and borrow irresponsibly until the deficit is obscenely large.  Make sure most of money goes to political supporters.  

  3.  Argue that cutting environmental/social/arts/science programs is the only way out of the problem.  "Tax cuts incease revenues and grow the economy"

-------

I don't think that liberals saying "deficit spending is good" is a winning proposition.  For one thing, Cheney might be encouraged to further mortgage the country.  For another, we don't have the necessary training in straight faced up is downisms.

by Lystrosaurus on Mon Feb 07, 2005 at 05:21:36 PM EST

deficit (none / 0)

The Republicans have 2 main reservoirs of political capital:  First, the generally accepted notion that they are competent managers of money.  Second, that they can be trusted with national security issues.  The Bush administration is well on its way to squandering both of those political assets, and the D's should be relentless in attacking on both fronts.

Democrats need to hammer on a couple of points;  deficts have to be financed somehow, and ultimately we all pay for government debt in the form of higher taxes.  Also, Democrats should be reminding Americans how we got into such a deep hole--  it was the $350 billion tax cuts for the wealthy that are largely responsible for our present budgetary dilemma.

by global yokel on Mon Feb 07, 2005 at 05:32:08 PM EST

What we need is concrete easily understood plans. (3.00 / 1)

  1.  Invest 500 billion into alternate energy to install 100 billion watts of solar power which will put American producers of Solar in the forefront of the market, it will produce a steady stream of power/money and it will lessen our dependance on foreign oil thus lessening our need for foreign policy in the middle east.

  2.  We should spend 3 billion on Individual creativity grants.  1 billion would be for K-12.  1 billion would be for College and 1 billion would be for grad school or professional.  Contestants would pair with a school and each state would have a winner of 10 mill for the individual and 10 mill for the school(in each of the three catagories) for some creative thing that makes peoples lives better (state can decide criteria or leave it open, maybe have TV viewers vote).  Winner still owns all rights to the item. (I stole this idea from somewhere but can't remember where)

  3.  We should mandate that education is sold in smaller units.  IE College will be broken up into broad catagories like freshman english lit,Calc 1, Calc 2, Algebra, History of Asia 1 etc., and you can take that class from any acredited school and transfer it to any other acredited school.  The schools can deny you their graduation but the US government will give you a degree if you have taken all the classes that make up the program you want.  So if you went to Harvard, Yale and Chicago Jr College you would get a degree from the US government because Harvard and Yale don't want to recognize the Chicago Jr college issues.

  4.  We should make it easier for individuals to sell their work on an hour by hour basis.  If the expenses that employers pay for employees were determined on an hourly basis (regardless of salary or hourly employee so 60 hours work is 1.5 times the tax of 40 hours even if they don't pay employee) then employers would be free to hire extra help on an hour by hour basis.  If 3/4 of their workforce was 35+ hours a week then they could hire the other 1/4 hourly without paying this tax or with a bonus.  This would make the employer and the employee bargain at an equal stance for the 1/4 extra time, the employee could get more money for this time than employers are usually willing to pay for 40 hour employees.  

Imagine working at McDonalds in HS and then being able to go back when you are a little behind and offering to work a weekend shift for them 3 years later, assuming your training is up to date they would be willing to take you as there is no penalty for them doing so.  Now imagine they are short staffed and they call you, you negociate a price for the weekend shift and you work for them but this time since you don't need it you charge more.

All of these approaches will lower the debt either by reducing inports (1), increasing growth (1-5) or providing an income for Governent (1).  Some of these ideas are more popular than others but I think they could all be sold...

by donkeykong on Mon Feb 07, 2005 at 05:50:08 PM EST

Wrong headed thinking. (3.00 / 2)

Sorry. I find this whole thread to be full of baloney.

Fine reasoning of the sort in this thread has no impact on the electorate.

People who think along the lines of this thread are already liberals.

People who need help from government want help from government, not fancy distinctions and abstruse reasoning.

And the people who drank the Kool Aid are not listening.

Listen. To reach the Kool Aid drinkers, we have to break through on some issue. One issue. We have to help them become disillusioned.

They see Republicans as the fiscally responsible ones who protect the country from TaxandSpend.

Talking about the budget deficit attacks the Rethug strength and threatens to turn it into a weakness.

THAT IS WHAT WE HAVE TO DO!

Karl Rove's basic principle is to attack and neutralize his opponent's strength. Pounding on the deficit moves the ball in that direction.

Rove never worries about logical consistency. He never frets about how today's tactic will seem to commit his troops to some future course of action. If necessary, they'll do the opposite of what they say today.

Now, we don't have to go quite that far. But we need to see that the electorate does not go around remembering what people said in the past and holding them responsible to it. It was the Wurlitzer that blamed Kerry for inconsistencies, not people's memories.

If we do not break through the illusions by which Americans perceive the Republican Party, then it doesn't matter what we say or do.

We have got to break their strengths down. We have got to get Americans to begin to question their leadership.

If we can crack that seamless facadse, then possibilities emerge.

And if possibilities emerge, then we can get Americans to see all sorts of things. Eventually, we need to get Americans to start seeing the fact that "No Taxes" is killing them.

But before that we need an opening in the Rethug armour. This could be such an opening.

Go for it now and quit agonizing about the long term.

Stop fretting, people! Stop worrying endlessly about finding the perfect message. I swear we are STILL not capable of getting the fundamental fact about today's politics:

This is war. Attack the enemy or die.

by Thresholder on Mon Feb 07, 2005 at 06:50:46 PM EST

No (none / 0)

(a note, this will appear in its entirety here or in my diary here)

Deficit hawking is an important part of putting together a new coalition in the coming years.  The Republicans are on the verge of (if not past the verge) of permanently forfeiting their right to claim to be the bearers of fiscal responsibility.  There are a large group of voters (largely younger suburban voters) that are not comfortable with voting for the Democratic party for two main reasons right now.

More on the flip....

by PragmAddict on Mon Feb 07, 2005 at 06:55:14 PM EST

Preamble Democrats (none / 0)

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquillity, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

Democrats need to talk about what the government was actually formed to accomplish, not abstact concepts like social justice. I think a strategy placing programs in the following categories (see below) would be hard for the GOP to oppose and if they start to use our new constitutional language in their own proposals it only hurts because the very first words of the Constitution JUSTIFY THE EXISTENCE OF GOVERNMENT.

My quick thoughts...

Establish Justice - writing just laws for all people, not constructing laws as loopholes for backers

Insure Domestic Tranquillity - I'm drawing a blank..help me out on this one.

Provide for the Common Defence - Democrats should support large increases in troop numbers. It' good military strategy, good for morale, and good for the localities that host the troops. Adopt an aggressive posture on troop numbers and cut funds for NSA and black ops. Democrats can attack the GOP for supporting intelligence technology at the expense of human intelligence. If the technology is so good, where is Bin Laden? Human intelligence for the Common Defence (Arabic speakers, Farsi speakers, etc.) should be a Democratic issue.

Promote the general Welfare - Like Social Social security. A single payer system for health care fits nicely under this concept - the Constitution doesn't say promote profit margins for HMOs and Big Pharm, does it? Democrats need to frame social programs as promiting the general Welfare.

Secure the Blessings of Liberty to ourselves - To ourselves, not every nation on earth. We promote liberty by example, not through wars of choice.

The GOP makes a lot of hay with concepts of government that exist only in their strategy sessions (every judge deserves and up and down vote, activist judges are legislating from the bench, the President can not follow laws he thinks are unconstitutional (hat tip Alberto Gonzales!) and on and on....Why not promote a Democratic agenda that is born out of the ACTUAL founding document of our government?

"Nothing seems to embarrass the political class today." - Bill Moyers
by joejoejoe on Mon Feb 07, 2005 at 06:55:56 PM EST

Re: Preamble Democrats - Deficit talk (none / 0)

Funding the elements of a more perfect Union is the baseline of government and the GOP is shirking on providing Justice, Defence, and for general Welfare.

PAYGO is a good frame only if it's understood that a minimum amount of government is a given - the GOP contests this point and that is what Democrats need to highlight. That is why triangulation is a failed tactic - Republicans default position is zero goverment.

"Nothing seems to embarrass the political class today." - Bill Moyers
by joejoejoe on Mon Feb 07, 2005 at 07:18:21 PM EST
[ Parent ]

As Cheney said: (3.00 / 1)

"Deficits don't matter.  Reagan proved that."
-Price Of Loyalty

He was saying they don't matter politically.  

That word, "deficit", actually only matters to true fiscal conservatives, most of which who are in the closet nowadays, but increasingly showing their frustration with GOP irrresponsible budgeting.

To me and regular walkin' around folks I know, the best way to put it is how Howard did:

"You can't trust Republicans with your money anymore."

We should drill that line into the heads of all americans every day.  

by Sam Loomis on Mon Feb 07, 2005 at 07:44:26 PM EST

Economic Security = Democratic Party (none / 0)

I think it can help us if we work on establishing the frame that the Democratic Party is synonymous with economic security.  Democrats have the edge in public trust when it comes to most domestic issues, so we need to emphasize that "security" and "Democrat" go hand in hand.  This has a nice advantage when it comes to dealing with Bush and the Republicans as much of they depend on selling fear for much of their success. if they are pushing fear in 2006 we can come back with: "six years of Bush and Republican rule, and you're afraid for your job, your future, and the safety of your family.  they're making us less secure by giving us increasing debt as far we can see.  when did you last feel secure in your future and hope for your children's future?"

We can hit with terms like "Clinton Surplus" and by comparing the debt to huge credit card debt.  we can talk about the debt undermining our national security by making us dependent on foreign governments to fund our military.  

if you don't like "birth tax" we can find language that evokes "credit card debt" somehow--"every child is born owing $36,000 on the national credit card"  ideally we could find a way to show the "rich elite" not wanting to pay their "fair share"

by benchcoat on Mon Feb 07, 2005 at 08:13:42 PM EST

and reform (none / 0)

I think we can use this approach to tie Democrats to "reform," too.  "after six years, I'm more worried about my children's future--it's time for reform"
by benchcoat on Mon Feb 07, 2005 at 08:16:13 PM EST
[ Parent ]

If he eliminated Discretionary Domestic Spending (none / 0)

I mean every penny, we'd still have a small deficit. And his plan is to freeze spending. Very bold indeed.
by skipper2379 on Mon Feb 07, 2005 at 08:31:32 PM EST

Completely Disagree (none / 0)

We as democrats have an openning you can drive a Mac Truck through.

Republicans are no longer the party of fiscal responsibility.  This hurts them directly with their base.

Take this mantle and RUN with it as democrats...my god...it also takes head on the notion that democrats are tax and spenders....

Democrats, the party of fiscal responsibilty.
Come to us disillusioned republicans.

by JoelK in AZ on Mon Feb 07, 2005 at 08:32:53 PM EST

frames (none / 0)

there's no doubt that democrats have sucked in the past about connecting with people on economic issues. But that's no reason to run away from our biggest opportunity now.

there's a hole big enough here, not just to drive a Mack truck through, but an issue bigger than most justifications given for revolutions. A class war was just fought, but most people remain oblivious to the implications.

I'm not a big fan of balanced budget talk just for the sake of balanced budgets. The issue of balanced budgets and what W has been doing with the government's finances are two separate issues.

Economic issues are real and touches everyone of our lives...But you can't lead if you don't first understand the issues, or what/who you're up against and the long-term implications.  

We need a communicator (and a medium) to deliver the message.

There's so many ways to take off on a soap box from here... I won't launch from inside a comment... I'll try to touch on this in follow up diaries.

by zigzig on Mon Feb 07, 2005 at 09:57:53 PM EST

Democrats need to grab hold of their balls. (none / 0)

Afraid or unsure to talk about the deficits? Do the republicans really have you all running that scared, so on the defensive that you're unsure what topics aren't off limits for discussion? Well if this is any sign, we'll be seeing a democratic minority for the forseeable future.

Bush spends like a liberal and cuts taxes like a republican. It's fucking ridiculous and it has to stop before he completely pulls the rug out from under America's fiscal sanity. You can't do both. Now the chimp is making "huge budget cuts", yeah the whole sum of $12 bil across 60 programs IF congress even approves -- which it won't -- and most of the cuts are in social welfare programs.

Bush doesn't give a shit because he's going to be leaving office in 2009, just when these huge deficits are poised to really start hurting. I take it you democrats want to just sit back, hope you win the next election, and then spend those four years trying to wipe Bush's ass like Clinton wiped Reagan's and Bush Sr's?

Fucking grab hold of your balls and stand up for something. Have some political courage for god's sake. No wonder mainstream America made the democrats a minority party. And it's going to stay that way unless you show the people you're willing to fight for something. Learn something from Clinton: take their issues and make them your own. Become the party of fiscal restraint.

http://operationyellowelephant.blogspot.com/
by Vote Hillary 2008 on Mon Feb 07, 2005 at 11:24:10 PM EST

A smaller deficit and/or balanced budget means (none / 0)

smaller interest payments to foreign and domestic creditors (powers/monied interests) and more money for progressive programs that benefit the people of the USA, from increased spending on healthcare to real tax cuts that don't mortgage our children's future.  
by LionelEHutz on Mon Feb 07, 2005 at 11:26:58 PM EST

Change the Tone (none / 0)

Chris,

If you look at the glass half empty it will always be half empty and never half full. When Bush ran for President, Cheney said the focus of the campaign was to "change the tone".

The Democrats have to say, "buy now pay later". The Democrats have to get in front of cameras and say, "deficits ensure that the Republicans will raise taxes in the future". It's that simple. If you had John Kerry say, "we can either roll back the Bush tax cuts for the wealthy now, or roll the back for everyone later."

Democrats have to make it plain, that budget deficits are not something that will come to bear someday in the future, but that every day we borrow more money, the more we will suffer. They have to argue that they will not consider cutting taxes again until the wars in Iraq and Afghanistan are over.

And you have to remind people again and again, there is no such thing as a free lunch. Deficits today mean higher taxes tomorrow.

by risenmessiah on Tue Feb 08, 2005 at 12:35:01 AM EST

Suggestion: Birth Debt NOT Birth Tax (none / 0)

How about this for "framing"

Birth Debt instead of birth tax.

The "compassionate conservative" is putting all this debt onto the shoulders of the babies they are trying to protect.

Anyone out there run a focus group?

by media in trouble on Tue Feb 08, 2005 at 08:43:45 AM EST

jhg (none / 0)

The reason for talking about the deficit is to end the myth that the Republican Party is fiscally responsible.

Everything they SAY about the Democrats is actually true about THEM.

THEY are the spendthrifts.  THEY are the ones in love with a bloated Government.  Democrats favor a Government that is large enough and has enough money to actually do it's job.  Republicans favor a out-of-control monstrosity that just wastes tons of cash.

by ignatz on Tue Feb 08, 2005 at 09:14:03 AM EST

Number Numbness (none / 0)

I think one of the problems talking about the debt/deficit is that the numbers are so huge that they're meaningless to the average person- who generally doesn't have a clear distinction between millions, billions, and trillions.  7.4 trillion, 450 billion, 2 trillion, 85 billion, a googleplex to the fourth power- all of these number might as well be inifinity for most people.

I think we should reframe it in terms of smaller numbers- how big is the average family of four share of the debt?  There are a little less that 300 million people in this country, so 7.4 trillion divided by 300 million is about $25,000 owed by every man, woman and child in the country.  The average family of four's share of the debt is almost $100,000.  That's a number both small enough to be understood, and large enough to be alarming.  "Wait!  That's almost how much we paid for our house!  I owe that again?"  Now the number is understandable.

The $450 billion dollar deficit becomes $1,500 in new debt for every man, woman, and child- or $6,000 for a family of four.  That's how much new debt got added this year.

Actually, the situation is worse if we add in Social Security.  Counting what Social Security owns, that family of four really owes more like $120,000 in total debt ($30,000 per head), and got more like $8,000 new debt this past year ($2,000 per head).  The extra 2 trillion Bush's social security "reform" would add over the next decade is another $6,500 per head, or $26,000 for that family of four.  The $322 billion the goverment spent just paying the interest on the federal deficit is over $4,000 for that family of four.

Now these numbers are numbers people understand  $100,000, $120,000, $8,000, $6,500, $4,000- these are amounts of money we understand.

by bhurtaw on Tue Feb 08, 2005 at 09:59:26 AM EST

Deficit (none / 0)

The Reps' profligate spending is a huge opporunity for us.

Besides, the deficit is so huge and such a big problem that we CAN'T not talk about it.  To sidestep an issue like that would result in the same problems that we had with John Kerry's spineless drivel about the war.

People don't vote on issues as much as they vote for candidates.  The country agree with Dem positions more than Rep position, but Kerry couldn't get any traction because people weren't convinced of his leadership.  And people were convinced on his leadership because he rarely spoke strongly about controversial issues.

Yes, any time we're talking about balancing the budget, we're talking about an issue that is historically conservative.  But unlike certain issues, there's no reason why a balance budget is inherently conservative.  We can balance the budget by raising taxes and not going crazy on the spending.  The fact is most social programs aren't really that expensive, especially compared to things like wars, social security rehauls, and massive tax cuts.  

by alhill on Tue Feb 08, 2005 at 12:40:57 PM EST

Deficits and Politics (none / 0)

There seems to be a lot of talk here about deficits and politics; I am new poster, and no devoted fan of either political party.  Personally, I support the Republicans (so feel free to call me a troll; you'd be wrong).

I can't help but think that if a person earns $60,000 per year and spends $80,000 per year, the problem is on the spending side.

If the government taxes workers and receives revenues of $1.8 Trillion, and spends $2.3 Trillion (help me out here; I don't have the precise figures, but I believe these are sufficiently close) then the problem is on the spending side.

As an example, I have a friend who, for many years, operated on a 1.3-to1 ratio of spending to income.  She has a wardrobe that rivals Paris Hilton, which was financed by credit card debt sufficient to make many squeamish.

She is now in Chapter 11.

You can blame W; you can blame Cheney; you can blame the Republican Party to your heart's content.

I place the blame on Washington's addiction to our tax dollars.

Should the Air Force spend $300 million of the national income PER PLANE on the
F-22? The arsenals of potential enemies (China, India, Russia, as well as a good potion of the Middle East) IMHO, make this a worthwhile investment.  Strength has a way of deterring, and it is simply not possible to discount the possibility of wide-ranging changes in political structures of other countries in the future.

I think the W was right in cutting taxes (BTW, I received a small benefit from that reduction, and I am by no means wealthy) and the results are now bearing fruit.

The economy IS growing, as measured by GDP increases.  Employment growth is lagging, and this is largely due to the availability of cheap labor pools in the Third World.  I wish that I had some means of resolving that issue, but that is a post for another time.

The Federal deficit is lower than originally predicted, largely as a result of increased output.  I can't help but believe that the tax cuts have helped in this development.

If Congress, and the White House, wanted to cut the Federal Deficit to zero, then both sides of the aisle would have to cut the budget to make this happen.

I often hear that "The only way to reduce the deficit is to raise taxes!"

I have never understood the logic behind that assertion.  If the government increases the rate at which it confiscates workers' income, then those workers will be able to spend less; this will negatively impact revenues and profits of the businesses that respond to consumer demand with either jobs or job cuts.

Does anyone really think that will increase Federal revenues?

Deficits are a far simpler concept than many would like to admit.  Any money borrowed today will involve two payments: Interest today and principle in the future.  

If the government runs a deficit, then the money must be borrowed from somewhere, interest must be paid on that money, and some day that bond is going to mature.

Furthermore, state budgets have both an operating component and a capital component; the Federal budget, to the best of my knowledge does not operate this way.

The Federal government pays for buildings, roads, bridges, waterways and capital equipment (aircraft, vehicles, etc.) the same way it pays for salaries, benefits, fuel and electricity (among many other expenses).  I am sure the CPAs reading this can provide sufficient commentary on this situation.  Furthermore, I would bet that anyone reading this post does NOT use a 30-year mortgage to pay for their light bulbs or their electric bill; nor can most people pay for a home with current assets.

The Republicans have morphed into the "Borrow-and-spend-with-reckless-abandon" party of fiscal irresponsibility.  The global capital markets should punish them harshly for it, and I suspect they will shortly.

Regrettably, the Democratic Party does not offer any real solutions.  

Single Payer National Health Care?  Ask any Canadian if they like waiting 6-12 months for a procedure that takes 6-12 DAYS in the USA.  As flawed as the health care provision and financing is in this country, I will take it any day over the alternative.

Withdrawal from Iraq?  There were 2.5 million South Vietnamese who were murdered by the Communists after the US withdrawal; I fear that a similar fate could befall the Iraqis should the departure of American troops occur before the Iraqis are able to fend for themselves.  That would be far worse than being perceived as occupiers, even if only its in the eyes of Ted Kennedy.

Raise taxes to reduce the Federal deficit? As I have commented above, reducing Federal revenues is not the answer; cutting spending is.

by moneybagzz on Mon Feb 14, 2005 at 12:37:13 AM EST


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