Editore"s Note
Tilting at Windmills

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June 1, 2004
By: Kevin Drum

TAX CUTS vs. SPENDING CUTS....Responding to an LA Times story about internal Republican battles between the tax cutters and the deficit cutters, Jonah Goldberg wonders why we can't have both?

While I think the logic of "pay-as-you-go" is deeply flawed and I do not embrace it, what's wrong with cutting a deal that "pays" for tax cuts with more spending cuts? I say "more spending cuts" as if there have been any spending cuts. And there haven't been. I can think of several cabinet agenices I would heave over the side in order to "pay" for tax cuts. If the only politically feasible way to get tax cuts is to agree to spending cuts, I say "Wahoo!"

Why have a silly battle to define the "heart and soul" of the GOP as either tax cuts or spending cuts? Why not define it as both tax cuts and spending cuts? You need both to be the party of limited govenment, don't you?

"Wahoo!" is my reaction too, but for slightly different reasons than Jonah. You see, Jonah writes about swinging cuts in federal programs as if this would be a popular move, and in this I don't know if he's merely mistaken or being disingenuous or what. But there's not much question that he's wrong.

In the past there has always been a natural feedback loop that kept conservatives and liberals in check. Conservatives, by supporting tax cuts and prudent fiscal policies, earned the support of millionaires and big business. Liberals, by supporting broad growth of popular federal programs, earned the support of the poor and middle class. Neither side had a permanent advantage.

But a few years ago the Republican leadership had the bright idea that they could forge a permanent Republican majority by coopting both of these constituencies. If you support tax cuts and big government, there's no one left to vote against you. Everyone's happy.

Which is why this battle is happening. Jonah may like the idea of heaving a few cabinet agencies over the side, but people like Karl Rove and Tom DeLay know perfectly well that this would be electoral suicide. Even aside from the fact that most of Jonah's target agencies are quite popular with some key constituencies, everyone who looks seriously at federal spending for more than a few minutes knows perfectly well that the vast majority of spending goes to four things: Social Security, Medicare, national defense, and interest payments. Unless you propose large cuts in those programs, you just aren't serious about "small government."

And of course no one will ever propose serious cuts in those programs. Interest payments are untouchable for obvious reasons, and the other three are all highly successful and highly popular programs. Not only won't they be cut, but demographic and other pressures ensure that all of them will grow considerably over the next couple of decades and everyone knows it.

It's this that makes modern Republican fiscal policy so deeply cynical and abhorrent. The leadership of the pary knows perfectly well that spending won't be cut because they'd be kicked out of office instantly if they tried it. At the same time, they also know that their tax cuts will produce extremely damaging long term deficits. But they don't care because the damage won't become apparent until they leave office.

Off the top of my head I can't think of another period in which a political party deliberately enacted policies they knew to be so damaging over the long term. Mistaken policies, sure, but not deliberate ones. But that's what the Newt Gingrich revolution did to the Republican party. The only question left is just how bad things will get before America sees through the sham and decides to put the adults back in charge.

UPDATE: I've already mentioned this in comments, but it's worth noting that my vague phrasing about the "Newt Gingrich revolution" was rather poorly put. What I should have said, but didn't, was that the Bush/Rove/DeLay reaction to the failure of Newt's budget cutting proposals in the mid-90s has defined today's Republican party.

Jacob Levy is exactly right in pointing that out in more detail here. As he says, the party decided to "never get Gingriched again," and the result was a commitment to support both people-pleasing tax cuts and people-pleasing expansions of federal programs. And while I agree with Jacob that Newt's failure doesn't "logically culminate in the 2004 Republican Party" the party leaders could have chosen a more responsible path, after all in the end they chose what they chose. Much to their eternal shame, I might add.

Kevin Drum 1:44 PM Permalink | Trackbacks

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