A few cracks appear in GOP attitude to taxes

Any hope we might have of addressing the federal government’s long-term financial crisis depends on bipartisan cooperation.

Which of course means that we have no hope whatsoever.

But wait! What is that off on the horizon to the far right? A prominent conservative making sense and telling the truth about fiscal issues? Why yes, it is!! Let’s go check it out!

Kevin D. Williamson is deputy editor of National Review and author of its Exchequer blog, focusing on the debt and other fiscal issues. He is also, as far as I can tell, very very conservative. But to his credit, he has run out of patience with the Republicans’ knee-jerk instinct to pretend that tax cuts are the cure for all that ails us economically.

Back in April, for example, Williamson attacked the conservative credo that tax cuts pay for themselves, noting that “a poorly applied supply-side analysis has infantilized Republicans when it comes to the budget. They love to cut taxes but cannot bring themselves to cut spending: It’s eat dessert first and leave the spinach on the table.”

“There is no evidence that the tax cuts on net produced more revenue than the Treasury would have realized without them…. It’s a just-so story, a bedtime fairy tale Republicans tell themselves to shake off fear of the deficit bogeyman. It’s whistling past the fiscal graveyard. But this kind of talk is distressingly unremarkable in Republican political circles.”

“How is an unfunded tax cut today different from an unfunded stimulus-spending bill today?” he asks in a post from July. “Both increase the deficit, both perform a wealth transfer from the future to the present under the theory that doing so will increase growth and spur the economy. Both are irresponsible.”

The core of Williamson’s argument is that tax cuts without offsetting cuts in spending are not really tax cuts at all. They are mere tax deferrals, in effect pushing the bill onto future generations. I not only agree with that analysis, I would take it a step further and argue that the GOP’s insistence on cutting taxes over the last three decades has helped encourage their worst nightmare.

The lesson is pretty clear, and was driven home particularly hard in the the Bush years: Tax cuts increase the size, popularity and power of government.

Why?

Because tax cuts disguise the true cost of government programs. They allow voters to demand more and more government help — more social programs, more earmarks, more wars — while paying less and less for it. It’s a pretty simple rule of economics: If you lower the price of something, people will want more of it, and the dynamic applies to government just as surely as it applies to Krispy Kreme doughnuts.

As a result, Williamson warns in a recent blog, “any Republican who sends me a press release talking up tax cuts without a word about spending cuts gets to be jackass of the day.” (He goes on to exempt Democrats from that contest because, he says, “you can’t be jackass of the day when you’re a registered jackass for life.” Being the reasonable sort, Williamson is of course not casting aspersions on all Democrats with that remark; he is merely noting that their political symbol is the donkey. Right, Kevin?)

On Thursday, congressional Republicans will announce their political agenda should they regain control of the House and/or Senate. I suspect that once again, it will be heavy on promised tax cuts and very skimpy on proposed spending cuts to offset that lost revenue. If so, it will be interesting to see how Williamson responds.

But let’s be clear here. Williamson and other like-minded conservatives remain conservative, and if given a free hand, their approach to solving the nation’s fiscal crisis would be very different from that taken by their liberal counterparts. But the reality is, there is no conceivable political scenario that will give them that free hand, and the same is also true for liberals.

Given that fact, the key will be to find common ground between the two camps, and the fiscal realism preached by Williamson and a few others offers at least a hope that such ground exists.

We know what the solution will be: Addressing our national debt will require serious cuts in government spending, including middle-class entitlements, business subsidies and a dramatic rethinking of our global military structure. The longer we delay such steps, the more dramatic the retrenchment will have to be.

However, a solution is also going to require across-the-board tax increases, timed to begin once the economy has had a chance to recover. That too will be essential. Both steps — tax hikes and spending cuts — are absolutely necessary if the bargain is to work economically, politically and mathematically.

Maybe it’s my own delusions playing out, but I believe there is more willingness to contemplate such a deal on the left than on the right. I’m not saying that there’s anything close to a majority of Democrats ready to accept serious budget cuts, but I do believe the subject can at least be broached in the context of a larger political bargain.

I do not see similar bargaining room on the right, in large part because the Republican Party has made opposition to taxes and the embrace of tax cuts the defining characteristic of its movement. The existence of Williamson and others willing to tell some hard truths from within conservatism at least offers hope that could change.

658 comments Add your comment

ty webb

September 22nd, 2010
10:11 am

“He is also, as far as I can tell, very very conservative.”

And just what is the scale in Bookmanland?

USinUK

September 22nd, 2010
10:15 am

um. ty. have you ever read the National Review? you do realize that it was started by William F. Buckley, don’t you?

they’re not known for hiring long-haired-hippie-types

jm

September 22nd, 2010
10:15 am

And the middle class taxes will have to rise significantly. Probably doubling. I for one, am very unexcited.

Mick

September 22nd, 2010
10:15 am

Jay, remember in this day and age, all repubs must comply with the dictates of rush or risk becoming ostrasized and voted out for not being conservative enough. Logic and common sense has to be thrown out the window with the bath water.

DebbieDoRight

September 22nd, 2010
10:17 am

jay The core of Williamson’s argument is that tax cuts without offsetting cuts in spending are not really tax cuts at all. They are mere tax deferrals, in effect pushing the bill onto future generations

We saw this attitude right here in Atlanta. For years, probably even decades, the sewer systems needed to be fixed — however not one politician wanted to go to the public and say, “Hey, we’re gonna have to raise your taxes in order to fix our old and decrepit sewer system”. So what did they do? The pushed the problem along to the next guy, who pushed it to the next guy, until they could push it no more and had no choice but to address the issue. By then the cost of fixing the problem had risen substantially.

jay: On Thursday, congressional Republicans will announce their political agenda should they regain control of the House and/or Senate

They did that already, it was called “Contract With America”. And, like all good businessmen, once they had the public sold on their world view, they showed them the “fine print”; that basically said, once we’re in we’re gonna do what the F$#@##$$%%% we wanna do.

jm

September 22nd, 2010
10:17 am

I vote 3/4 budget cuts, 1/4 tax increase to close the deficit.

The Boner's Tan Line

September 22nd, 2010
10:17 am

The Boner believes only poor people should pay taxes. The Boner has his own tanning bed so he don’t have to worry about that tax either.

The Boner’s got mucho money banked in Switzerland. But don’t tell anybody.

jm

September 22nd, 2010
10:18 am

DebbieDoRight –

“We saw this attitude right here in Atlanta.”

Well, looks like deferring taxes to fix things isn’t just a Republican affliction is it? Or is the city of Atlanta run by Republicans? Just sayin.

USinUK

September 22nd, 2010
10:20 am

jm – “I vote 3/4 budget cuts”

even in the military?

even in food safety?

even in drug testing?

DebbieDoRight

September 22nd, 2010
10:22 am

jm unlike you I’m not fixated on whether someone has an “R” or “D” behind their names. I’m fixated on solving the problem NOW before it gets too big or too expensive later. I’ll vote for the person that I believe who can fix the problem — no matter what their political association is; mainly because in the end, whatever your poltical affiliation, we will ALL have to pay the piper after the dance.

jm

September 22nd, 2010
10:23 am

USinUK – yes…. I’d overweight the military, social security and medicare cuts before food safety and drug testing, but yes, everything is gonna have to shrink….

jm

September 22nd, 2010
10:23 am

DebbieDoRight 10:22 – agreed.

Joe The Plumber Too

September 22nd, 2010
10:24 am

Re: Debbiedoodoos 10:17, Sounds like every word coming out of oblowblow and piglosi’s mouths the last 20 months.

jewcowboy

September 22nd, 2010
10:24 am

Reality does not seem to be a concept many in Congress ascribe to…

RW-(the original)

September 22nd, 2010
10:24 am

You can almost see the case for death panels in government health care all throughout this column.

ty webb

September 22nd, 2010
10:25 am

UsinUK,
yeah, I was just wandering why the 2 “very”’s before the “conservative” label. We need some sort of key or legend. I’m thinking anyone to the right of Marx(karl, not groucho) warrants a three “very”’s from Bookman.

DebbieDoRight

September 22nd, 2010
10:25 am

USinUK the military will probably be the only place where there will be jobs left in about 15 years. All others will be outsourced to India.

StJ

September 22nd, 2010
10:26 am

I vote to get rid of the “Czars” and their departments…that’ll save some money. Perpetual welfare (including corporate welfare) can go too. Consolidate all the national “security bureaus” back down to FBI, CIA, Secret Service and dissolve the other redundant entities.

There’s a start. Will it actually happen? Probably not (governments hate giving up power).

Kamchak

September 22nd, 2010
10:26 am

But…but…but…tax cuts have been found to cure the gout, warts, eczema, seborrhea and the heart-break of psoriasis.

Gotta have them tax-cuts.

jm

September 22nd, 2010
10:27 am

RW – I’m for “death panels” (or cost – benefit analysis regulations in Medicare and Medicaid) as absurd as it sounds. These are government benefits. If people don’t like the “death panel” decision, they can go spend their own money.

Decrying government decisions on a government provided benefit is hypocritical (for a fiscal conservative anyway).

jewcowboy

September 22nd, 2010
10:28 am

StJ,

“Probably not (governments hate giving up power).”

Actually your proposition concentrates power…

Jimmy62

September 22nd, 2010
10:28 am

If you make a real effort to cut spending, and I mean significant in comparison to the entirety of our government, not just a billion dollars, then the Tea Partiers and average citizens will be a lot more willing to accept higher tax rates. But not if the government isn’t willing to make some real cuts first. And so far, they, no matter the party, have shown no willingness to make some serious cuts in spending. That should be the first step, before raising taxes. If it’s not, then our government is betraying the people they work for, putting themselves and the public sector before the country as a whole.

USinUK

September 22nd, 2010
10:29 am

ty – ha! I’d love to see a sliding scale (Karl Marx on one side, Ayn Rand on the other) … or maybe a rating system (I give him 3 Greenspans out of 5)

Doggone/GA

September 22nd, 2010
10:30 am

“social security”

Social Security is not part of the problem. It has a separate funding stream and is not supported by any other taxes.

stands for decibels

September 22nd, 2010
10:30 am

Addressing our national debt will require serious cuts in government spending, including middle-class entitlements

Harold Ford? Democratic Losership Council? Is that you?

/drive-by

jewcowboy

September 22nd, 2010
10:30 am

Kamchak,

“ax cuts have been found to cure the gout, warts, eczema, seborrhea and the heart-break of psoriasis.”

And pilonidal cysts..

http://www.snopes.com/military/limbaugh.asp

DebbieDoRight

September 22nd, 2010
10:32 am

Re: Debbiedoodoos 10:17, Sounds like every word coming out of oblowblow and piglosi’s mouths the last 20 months

Morning Whine!! How’s it going? I see you’ve changed your log-in name again, what happened? Someone found out who you were and threatened to go to your Mom’s house and beat you up again? Don’t let them scare you Whine — you just stay safe and sound in your mom’s basement and you keep on blogging……just because they’re smarter, or probably better looking, and probably they actually have $$ex with real people doesn’t mean that they can intimidate you. Keep your head up!!

Redneck Convert (R--and proud of it)

September 22nd, 2010
10:32 am

Well, I see another preacher’s in the news over maybe doing You Know What with a bunch of boys while preaching against it. It’s always good to know a preacher knows what he’s talking about. And Fulton County’s all mad because four workers stole about $180,000 before commission members got a chance to do it.

Now to Bookman’s topic. One answer for you, Bookman: Trickle Down. See, people take the tax cuts and spend them or save them and before you know it people spend so much the taxes just come rolling in and make up for the tax cuts and then some. Well, maybe not before you know it. We’re still waiting for the Trickle Down from the Reagan tax cuts. But it’ll come in maybe another 20 years. And in another 40 years or so, our grandkids will see the dangest economic explosion you can imagine when My President’s tax cuts start Trickling Down.

Anyhow, I’m kind of suprized Bookman expects us Republicans to start cutting spending and raising taxes when we take over Congress. I wonder if his Mommy and Daddy told him about Santa Claus yet. All I got to say is, don’t take it too hard when they tell you, Bookman.

jm

September 22nd, 2010
10:32 am

Doggone 10:30 – I disagree. It is a part of the problem. And when it runs a deficit (as it is this year for the first time, and will pretty much going forward run a deficit), it is implicitly subsidized by a combination of the other taxes and borrowing (since money is fungible).

RW-(the original)

September 22nd, 2010
10:33 am

jm,

You assume that the government intends to give you a choice. You can already see the way this health care bill is going to affect the future just by seeing insurance companies dropping child only policies from their offerings because from tomorrow until 2014 a person would be insane to buy coverage until their child got sick.

Got to run though.

Later

I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...

September 22nd, 2010
10:33 am

When the Democrats are not led by Marxists these days, they are led by literal clowns like Bill Maher, Jon Stewart, Tina Fey, and Michael Moore. The message from the clowns to Delaware voters is that they must vote for the Marxist because O’Donnell is literally a witch. You can’t make this stuff up. If only that were true. Then O’Donnell could cast a spell over voters to ensure her victory.

I seem to remember another clown weighing in on the witchcraft issue.

Hi kookman!

ty webb

September 22nd, 2010
10:34 am

I beg to differ, SS is a huge problem. For a spendaholic government, SS is another source for a “daily fix”. quick someone get Algore on the phone…what was that about a lockbox?

jewcowboy

September 22nd, 2010
10:34 am

Jimmy62,

“If you make a real effort to cut spending, and I mean significant in comparison to the entirety of our government, not just a billion dollars, then the Tea Partiers and average citizens will be a lot more willing to accept higher tax rates.”

And the Orange Pekoe Brigade would be happy with cuts to Social Security and Medicare I suppose…

http://washingtonindependent.com/wp-content/uploads/2009/09/Medicare.jpg

USinUK

September 22nd, 2010
10:35 am

jm – 10:23 – as long as the cuts aren’t entirely on the backs of the poor – I still don’t think I can see 75% unless there is a line-by-line assessment of wasteful projects AND unless their system of budgeting is changed from a use-it-or-lose-it system to something that rewards thrift

FrankLeeDarling

September 22nd, 2010
10:35 am

Wait ! I know let’s dig a big tunnel under Atlanta AND cut taxes

jewcowboy

September 22nd, 2010
10:35 am

“And Fulton County’s all mad because four workers stole about $180,000 before commission members got a chance to do it.”

Now that is funny :)

jm

September 22nd, 2010
10:36 am

RW 10:33 – I’m only talking medicare / medicaid. Private insurance is a wholly different matter.

Jay

September 22nd, 2010
10:37 am

For the record, the Kamchak namejacker has been at least temporarily banned.

That’s not tolerated in these parts.

Kamchak

September 22nd, 2010
10:37 am

jewcowboy

Eeewwww.

TMI!

Doggone/GA

September 22nd, 2010
10:38 am

“And when it runs a deficit (as it is this year for the first time, and will pretty much going forward run a deficit), it is implicitly subsidized by a combination of the other taxes and borrowing (since money is fungible).”

Actually, no it isn’t. “the Social Security OASI and DI Trust Funds are adequately financed until 2040 and 2018″

http://www.ssa.gov/OACT/TRSUM/index.html

There ARE long-term imbalances that need to be addressed, but they are not a significant issue and they can be addressed via the current funding stream being strengthened. Other tax issues have no effect on SS.

jm

September 22nd, 2010
10:39 am

USinUK 10:35 – I agree with you. Unfortunately, we’re an agglomeration of people with lots of different opinions. But Re waste, that obviously has to be cut and I agree with you on the incentives too. But I don’t think you or I will get to make the decisions. In lieu of everyone getting to vote on what’s wasteful and what’s not, we probably just need across the board pro-rata spending cuts.

Kamchak

September 22nd, 2010
10:41 am

jm

September 22nd, 2010
10:41 am

Doggone 10:38 – oh lord. There are no “trust funds”. Unless you count lots of future borrowing from China. I guess China is our “trust fund” daddy.

Doggone/GA

September 22nd, 2010
10:43 am

“There are no “trust funds”. ”

Wrong again. The trust fund is there, just as it is for any other insurance plan. It has been lent out, but is backed by treasury securities – which are a safe, secure investment.

jm

September 22nd, 2010
10:43 am

Doggone – “treasury securities – which are a safe, secure investment.” now that’s funny

Doggone/GA

September 22nd, 2010
10:44 am

“now that’s funny”

Nope, not funny. Where do you think China is putting the money that we are borrowing from them?

jm

September 22nd, 2010
10:45 am

Political advice for Obama from Walter Mondale. That’s funny too….

http://online.wsj.com/article/SB10001424052748704129204575505822147816104.html

The strange case of Jake Pusser, Federal Overseer

September 22nd, 2010
10:46 am

Once,,,,,,,,,,,,,,,,many years ago, ,,,,,,,,,,,,,,due to strange and unforeseen circumstances,,,,,,,
and a disfunctional federal government……………

I had the occasion to be labored with the duty of transporting to…..and selling of………… 100 citizens upon ……………..the collective slave auction block.

Although outnumbered 100 to 1…..twas only me………..the citizens WERE properly mentally manacled.

After many trials and tribulations,

I made it to the collective slave auction block, but there the trouble began………………..

jm

September 22nd, 2010
10:46 am

Doggone – into aircraft carriers, subs, and fighter jets bubbo. and overspending on real estate construction…

TaxPayer

September 22nd, 2010
10:48 am

For a moment there, I thought this was an article about the GOP’s plan to tax meth in order to fund the next round of tax cuts for the wealthy.

USinUK

September 22nd, 2010
10:48 am

jm – “But I don’t think you or I will get to make the decisions.”

and therein lies the problem!

Doggone/GA

September 22nd, 2010
10:48 am

“Doggone – into aircraft carriers, subs, and fighter jets bubbo. and overspending on real estate construction”

They lend the money to US but they’re spending it? Try again. They are buying our Treasury securities…that’s HOW they are lending us the money.

USinUK

September 22nd, 2010
10:49 am

jm – “now that’s funny”

defaulted once in 230+ years … not a bad record.

jm

September 22nd, 2010
10:50 am

Doggone – I don’t think I have the time to educate you on the US financial markets (and China) if you don’t understand the basics….

jm

September 22nd, 2010
10:51 am

USinUK – you’re right. but the review mirror didn’t work too well for valuing MBS though….

Soothsayer

September 22nd, 2010
10:52 am

Kamchak @ 10:26: Don’t forget “lumps, bumps and ugly bulges.”

USinUK

September 22nd, 2010
10:52 am

jm – meh – that had less to do with a rear-view mirror than it did investment banks playing fast and loose with the security details in the roll-ups

Del

September 22nd, 2010
10:55 am

In Jay’s desperate quest to divert attention, at least on this blog from a failing administration with failed policies he goes out and finds Kevin D. Williamson. Of course we need cuts in government spending and of course Republicans deserve criticism right along with the Democrats for over spending. In the real world of today’s economic mess you have Democrats spurred on by this administration continuing the reckless government spending that exacerbates are economic problems. Now for tax cuts…the Democrats call it tax cuts for the middle class fully expecting the ignorant masses to believe their going to get a tax cut. No their not, because most will only see their tax bill remaining the same and those who realize tax cuts are only those who’ve been removed from the tax roles. We’re now close to 50% no longer paying federal tax with a significant number actually getting tax refunds on tax’s they’ve never paid. Meanwhile you have Democrats saying that they want to increase tax’s on two percent of the population and that will save 700 Billion over ten years, but that won’t even make a dent in our deficit . They of course make little meaningful reference to reducing the deficit through spending cuts, because they know that’s just not a priority with their far-left base. Come on now be honest, the Republicans are talking about reduced government spending and extending the BUSH tax cuts for everyone because of the economy and the need to not create any further impediment to necessary job creation. If the Republicans do regain control or partial control of Congress this November, they will be closely measured on their sincerity to propose and implement spending and government reduction programs that work.

Paul

September 22nd, 2010
10:55 am

Jay

Thanks for pointing out the dim, wavering ray of hope in the dark clouds of conservative current fiscal doctrine. Excellent analysis, too.

Will Democrats go along? There are a hard-core in Congress who will not, under any circumstances, cut spending. I think there are moderate Democrats who’ll be open to it. Maybe one good thing to come out of a Republican Congressional majority? Spkr Pelosi, no moderate (and I’m not sure how practical in this area) replaced so moderate Dems become more willing to deal with a Republican majority who realize they have to deliver something?

Hi, DDR!

JohnnyReb

September 22nd, 2010
10:55 am

Jay is mostly correct. However, Repub’s do know it will take tax hikes, spending cuts, and that magical potion missing from Barry’s vocabulary, growth. The problem is getting elected. The patient does not want to take the medicine. Repub’s would be foolish to come out now (God I hope they don’t) telling the middle class they too will have to pay more taxes.

As for now, almost everyone but Obama knows it would be foolish, unwise, stupid, to raise taxes on anyone until the economy recovers.

The strange case of Jake Pusser, Federal Overseer

September 22nd, 2010
10:56 am

The first disgruntled 20 of the 100 slaves called themselves democrats. Mostly women and children, they were hungry and frightened. The few” men” in the group spoke much about some obscure sport called soccer and I think that I detected make-up.

I promised them three meals a day, protection, and CCTV soccer.

They went willingly to the auction block. (didn’t get a good price).

jm

September 22nd, 2010
10:56 am

USinUK – that’s true too. But their myopic view was obvious when, as was pointed out, S&P didn’t even have the ability to account for a decrease in house prices in their model. big, big oops.

Of course, having the ability to model decreases would’ve been difficult, since there wasn’t good historical data to use since prices had pretty much been going up since decent data was available. Anyway, the assumptions were a big part of the problem.

larry

September 22nd, 2010
10:57 am

According to the “Washington Post,” China became the largest foreign creditor to the U.S. in November 2008. Because of this, China has great influence over the American economy. Should China choose to stop buying U.S. debt, it would cease one of the largest in-flows of capital into the country, making it harder for businesses to obtain loans and raising interest rates and commodity prices for consumers. If China were to begin selling U.S. debt–essentially cashing in its government bonds–it would actually remove money from the U.S. economy, creating an even more dire situation.
Another issue is the disparity between the currencies. In the global economy, the dollar has much more buying power than the yuan (China’s denomination). This makes U.S. goods more expensive to export to foreign nations than Chinese goods. As such, China’s prices for manufactured goods are far more competitive than those of the U.S.

jm

September 22nd, 2010
10:57 am

That, and low doc no doc fraudulent loans….

Bosch

September 22nd, 2010
10:58 am

Heard an interview this morning talking about that Socialist/Marxist/Facist Dwight D. Eisenhower and during his administration the tax rate was like a gajillion percent or something and how the middle class prospered during that time because the government could afford to subsidize the middle class in regards to good education and other things…..now, not so much.

Now, we have the conservatives who want to fight for their right to become indentured servants.

jm

September 22nd, 2010
10:59 am

Soothsayer

September 22nd, 2010
11:00 am

jm

September 22nd, 2010
11:00 am

Bosch – um, cause we were paying for WWII?

Doggone/GA

September 22nd, 2010
11:02 am

“If China were to begin selling U.S. debt–essentially cashing in its government bonds”

jm – why don’t you take a stab at explaining why this statement is different from what I said?

DebbieDoRight

September 22nd, 2010
11:02 am

. Come on now be honest, the Republicans are talking about reduced government spending and extending the BUSH tax cuts for everyone because of the economy and the need to not create any further impediment to necessary job creation.

Oh please. Your whole paragraph was factually and historically inaccurate, but this one excerpt that I pulled out right here is some of the best jibberish, balderdash, and outright LIES I’ve read since Deal “accidentally” forgot to put in his application to run for office form his being $2M+ in debt. :roll:

jewcowboy

September 22nd, 2010
11:04 am

Bosch,

“Now, we have the conservatives who want to fight for their right to become indentured servants.”

I don’t think the Beastie Boys will be singing about fighting for that right ;)

USinUK

September 22nd, 2010
11:05 am

jm – 10:57 – for that post alone, I owe you a big, fat hug (nice to see someone else cite that element of the meltdown)

USinUK

September 22nd, 2010
11:06 am

jdb and Bosch – 11:04 – too hard to find a rhyme.

Jefferson

September 22nd, 2010
11:07 am

Once the debt is reduced via revenue increases, interest savings will be the cut in spending that is the best one.

JohnnyReb

September 22nd, 2010
11:07 am

Soothsayer @ 11AM – that elitist burden you carry must be really heavy.

Bosch

September 22nd, 2010
11:08 am

“Bosch – um, cause we were paying for WWII?”

Um, like we’re not paying for a war or two now?

jewcowboy

September 22nd, 2010
11:09 am

Paul,

“Maybe one good thing to come out of a Republican Congressional majority?”

That has yet to be realized…

http://edition.cnn.com/2010/POLITICS/09/22/chamber.president.gop.takeover/index.html

“Spkr Pelosi, no moderate (and I’m not sure how practical in this area) replaced so moderate Dems become more willing to deal with a Republican majority who realize they have to deliver something?”

Quite frankly, I think the Democrats have been a little to willing to deal with Republicans, much to their own detriment. When it became obvious that almost every initiative would be met by a stonewall no, the Democrats should have taken advantage of their majority. So now, in addition to looking ineffectual, they look naive as well.

Del

September 22nd, 2010
11:09 am

“Your whole paragraph was factually and historically inaccurate”

Is that just because you say so, or is it because you can prove your point. Yeah, I know it’s because you can’t prove your point but enjoy yourself anyway.

arnold

September 22nd, 2010
11:09 am

There will be no compromise until both sides are willing to give up something they don’t want to do. It’s the same as a compromise on anything. Even the Middle East needs the same attitude to reach a compromise.

jm

September 22nd, 2010
11:10 am

Doggone – China only uses part of the money we send them to buy back our treasuries. The rest they spend on upgrading their military and infrastructure.

Back to the SS discussion. There are no assets to back it up, unless you count IOU’s. If the SS trust fund owned mortgages, businesses, etc, there would be assets backing it up and the Trust fund would be “ok”. Although the reason they don’t own all this is because congress wanted to use the money for other things and it looked like bad policy for the US gov’t to own a bunch of US assets.

If there are “assets” backing up the SS fund, one could (implausibly) argue that the US infrastructure and all previous assets built or purchased by the US government are the assets “backing up” the previous SS taxes paid in above the outflows.

So, if you want to suggest that it makes sense to sell all our military hardware (I don’t think there are too many buyers, and that would kind of suck for US power, and it’s not worth as much as the SS hole) and to sell of all our interstates and US government property, go right ahead. All of that still won’t fill the SS hole. So, basically, the money was pee’d away.

If you think US Treasuries held by the SS fund are “assets”, you don’t understand accounting.

So let me explain further. Since the fund holds Treasuries, they have the IOU’s. HOWEVER, to redeem the IOU’s to pay the trust fund sucklings, they have to do one of two things (since the fund on a cash flow basis is break even right now – slight deficit), they have to raise taxes (take more money from people working now) or they have to issue more “publicly held debt”, ie to outside investors. Either way, there are no assets, just a big, financial mess.

Bosch

September 22nd, 2010
11:10 am

Paul,

“the Democrats should have taken advantage of their majority. So now, in addition to looking ineffectual, they look naive as well.”

Amen to that. They should have called their bluff and told them to go ahead and filibuster, and played footage of them doing so on every network, cable, internet, youtube, hell, even rented a billboard or two to show them doing it.

Paul

September 22nd, 2010
11:12 am

Have I missed something in my scan? Have any who adhere to the Republican mantra of ‘extend the tax cuts for all and cut spending” offered any specifics on where to cut? Not generalities, like naming Departments, but real, no kidding specifics?

And the next question: if the Republican leadership takes legislative control and does not come through with specifics, will the Republican supporters agree that Republican Congressional control failed in its responsibilities and control should be returned to the opposition party?

Bosch

September 22nd, 2010
11:14 am

Paul,

I’m going out on a limb here and saying the answer to your questions are a big giant “no” — you know the wingnut favorite word.

jm

September 22nd, 2010
11:14 am

USinUK 11:05 – I’m all for minimum 20% downpayments and real income verification…

USinUK

September 22nd, 2010
11:17 am

jm – 11:14 – stop. you’re making me cry.

you’ve got my vote for Fed Chair.

jewcowboy

September 22nd, 2010
11:17 am

Paul,

“Not generalities, like naming Departments, but real, no kidding specifics?”

The last time I asked for specifics on this blog, I got a cut and paste from the Heritage Foundation as a response, that was, surprise, generalities and half-truths…

Yes wiccan

September 22nd, 2010
11:18 am

Tax cuts create zillions of jobs, people. All you have to do is look around you and see all the jobs created by tax cuts from 2001 to 2009. Unemployment is at an all time low of 0.05 percent. And that’s only because of the lazies out there who just want to live off the government and refuse to work.

Duh!

Doggone/GA

September 22nd, 2010
11:18 am

“Doggone – China only uses part of the money we send them to buy back our treasuries. The rest they spend on upgrading their military and infrastructure”

but I was not discussing what they do with THEIR money. I was discussing where they put the money they lend us.

“There are no assets to back it up, unless you count IOU’s”

Which is back to what *I* said, and what the Washington Post said: they are lending us money by buying Treasury securities, which are the same as the “iou’s” backing SS. Good investment for the Chinese, good investement for SS. No difference.

jewcowboy

September 22nd, 2010
11:19 am

Paul,

“if the Republican leadership takes legislative control and does not come through with specifics, will the Republican supporters agree that Republican Congressional control failed in its responsibilities and control should be returned to the opposition party?”

It hasn’t happened in the Democratic Party so why would it happen in the Republican Party?

jm

September 22nd, 2010
11:20 am

USinUK – How’s the british austerity thing going? Too early to tell?

Any consensus on their health care reform / changes?

Del

September 22nd, 2010
11:21 am

“Republican Congressional control failed in its responsibilities and control should be returned to the opposition party?”

Well first of all it would only prove that both parties are inept, so returning it to the other inept party wouldn’t make any sense. Hopefully, we would then see a third party comprised of non-career politicians from the real world, who could lead this country back to prosperity.

Liberal Chicks are UGLY

September 22nd, 2010
11:21 am

Libs are the most hypocritical people I know…
They want to raise taxes, on everybody but themselves.
They love the earth and still drive cars.
They want to cut military spending, but add gays and illegals to the ranks.
They want money, but don’t want to earn.
They want to spare the lives of criminals and terrorists, but kill babies.
They hate Christians and Jews, but love muslims.

Seems all they want is for everybody else to carry their burdens

Paul

September 22nd, 2010
11:24 am

Bosch 11:14 jewcowboy 11:17

’bout what I figured…

jewcowboy 11:19

But is that not the argument Republicans make? That Dems have failed to do what they said they’d to, so control should be relinquished to the opposition?

So I’m asking, if the same happens in the future, will they be consistent and turn over control to the opposition party?

(Be quiet, Bosch…. I’m honing a comedy act here….)

USinUK

September 22nd, 2010
11:25 am

jm – “USinUK – How’s the british austerity thing going? Too early to tell?”

too early to tell – it’s not really coming into full effect until next year.

“Any consensus on their health care reform / changes?”

not that I’ve seen.

Clegg is walking a tightrope – if the LibDems play this right, they can remain a serious political party. as it is, though, a lot of the people who voted for them are piiiiiiiiiiiiiii$$ed because they feel that their vote turned into a vote for the Tory party, so we’ll see if the coalition makes it through 2011.

jm

September 22nd, 2010
11:25 am

Doggone – good grief. There’s a difference between a transaction between two separate parties and making a transaction with oneself.

I explained this once before a while ago here. To whit:

If you loan me money, you hold an asset.

BUT

If you loan your wife money which she goes and spends on whatever she wants (generally worthless things), and then it comes time for her to repay your loan to her, what happens?

Well, if you’re the US government, she goes and gets a credit card to repay you. What’s the net effect? Nothing. The IOU’s mean nothing. The only way to repay the IOU’s is to borrow more money. Trade debt for debt. It’s f’in meaningless. But the real debt to GDP ratio will go up. All bad news.

USinUK

September 22nd, 2010
11:25 am

oh, for the love of dog, will someone please give LCAU his frickin sign, already.

Paul

September 22nd, 2010
11:26 am

Del

“Hopefully, we would then see a third party comprised of non-career politicians from the real world, who could lead this country back to prosperity.”

Are you saying the Tea Party ain’t it?

So far, I see them expressing a lot of generalized angst, shared by many, but without a clear idea of what to do to stop the hurt.

Doggone/GA

September 22nd, 2010
11:28 am

“The IOU’s mean nothing”

YOU call them “IOU’s” but they are not. They are Treasury securities. The government can’t default on them, because that would devalue any OTHER securities being held and other countries would not buy them and thus lend us money. They are EXACTLY as secure as are the ones being held by China. No difference.

MBD

September 22nd, 2010
11:29 am

Tax cuts help us pay for mice with human brains.

Paul

September 22nd, 2010
11:29 am

Hey, USinUK

Are you the hottie with the hot sauce?

The cutie with the cayenne?

The princess with the peppers?

The tart with the Tabasco?

:-)