Line of the Day (“The Hands Up Moment” Edition)
“the hands up moment – perhaps the most important single moment in recent GOP politics – when all the candidates declared they would walk away from a debt deal that was 10 – 1 spending cuts to revenue increases. That was when they told us they were an ideological and religious movement, not a party fit for actual government.”—Andrew Sullivan.
The man has a point and it is one that underscores the sad state of the GOP at the moment. If these candidates are to be taken at their words then they are not interested in solving problems nor are they interested in governing, but instead appear to live in a fantasyland where recalcitrance is mistaken for solution to difficult problems (which does smack more of theology than it does actual governance).
And yet we have been told by people (who seem to consider themselves legitimate conservatives) who comment on this site that “we have a spending problem, not a taxation problem” and, in that regard, show themselves to be just as delusional as these GOP candidates…it is little wonder that these politicians would take these ridiculous stands as many of the people who comprise their political base believe in such foolishness…
So, Interested, are you saying that spending isn’t a problem and that we aren’t taxed enough?
SteveP, he’s saying that reasonable people don’t take reasonable tools off the table.
The “household budget” analogy seems popular, so I’ll try explaining it that way. If your personal finances were a mess, and your home in danger of foreclosure, would you refuse to find a better job, second job, or work overtime, even if the rest of the family was willing to give up 10x as much spending? Would you insist that your household budget be balanced solely on spending cuts, and let the bank repossess your home otherwise, all because you feel that it’s only a spending problem?
This is what separates mature adults from immature ones.
@SteveP: Is the problem only binary–either one or the other?
@SteveP: No, spending is, in fact, not a problem. And an increase in the top marginal tax rate would only benefit the economy.
I think there are people who say “we have a spending problem, not a taxation problem” and understand that they are attempting to frame the argument. I think they are wrong in a technical sense, but they can take their shot.
I’m less comfortable with folk who take “we have a spending problem, not a taxation problem” as a revealed truth, and who can’t see that other frames of reference are possible.
(“No, spending is, in fact, not a problem.” is also framing I cannot accept.)
Reports are that ‘non-financial’ US corporations are holding $1.9Trillion as cash. Doesn’t count the Treasury Bills and similar accounts. Just the cash. Not invested. No new jobs. No new products. No new ad campaigns, even. Just…stuck away in a great big safe-deposit-box or something.
http://advisors4advisors.com/investing/us-investing/article/12714-american-corporations-continue-to-sock-away-cash-at-highest-levels-in-last-50-years
So yeah, a big freaking tax on ‘cash reserves’ would be a damn fine thing for this economy.
@SteveP:
Spending is no problem for the US gov’t, they do that with out difficulty.
Sorry, no. Here is the question rephrased, and consider whether Obama would agree to it:
“Instead of a 10:1 ratio of cuts to taxes, would you agree to a 9:0 ratio?”
And of course Obama would not, because his objective is not to cut, it is to raise taxes. Raising taxes is a sacrament of the Democrat party.
@Donald Sensing: The only problem with your statement is that the two most recent deals reached (the deal to get a continuing resolution and the debt to raise the debt ceiling) both garnered cuts and no tax increases. As such, your attempt to restate is problematic.
Also: back in December, Obama signed an extension of the Bush tax rates in a bargain to get unemployment benefits extended.
Oh, and there was also the payroll tax cut.
So you were saying?
@Michael: Nope. Your analogy breaks down because you have the sources of revenue wrongly stated. To correspond to what the Democrats want, you should have written this:
Your personal finances are a mess and your home in danger of foreclosure. You have no earned income whatsoever because you (that is, the government) have no money of your own at all.
So you cannot get another job because you actually have no job to begin with. You have money only because you exact it from your neighbors and because you have open lines of credit. But you have to pay the interest on the borrowed money and your neighbors can, with much effort, band together to restrict how much you can compel them to give you.
Nonetheless, because the situation is dire, you agree to slow your rate of increasing spending if your neighbors will bring additional bags of cash to your front door every month.
That is what we are talking about, and why household budgeting is not apt. No one is Washington – no one – is talking about actually cutting expenditures, only about reducing the rate and rapidity of increases.
The argument is not about whether the US will finally become insolvent, only about how quickly we will get there.
@Steven L. Taylor:
I’ll grant that “raising taxes” is perhaps too narrow a phrasing – the sacrament is growing revenue, and if not by more taxes, then by borrowing.
That is what Obama did to extend unemployment benefits. The money has to come from somewhere. So the government either had to increases taxes to get it (which it did not do) or it had to borrow it, which it did do.
Same with the payroll tax cut: Obama agreed to exact less from workers’ checks. but since expenditures were not cut correspondingly, he simply borrowed it from their children. Some deal.
So you were saying?
@Donald Sensing:
And this is unique to the Democrats how? To wit: Afghanistan, Iraq, Medicare Part D….
It is rather difficult to ascribe a sacrament to one political party (especially as a counter-argument to my post) when this is something the GOP has gladly engaged in as well.
Part of my deep frustration with the Reps is that they spend, but do not figure out how to pay for said spending (despite what I was promised back in the 1980s that if the GOP ever got control of the government there would be fiscal responsibility).
The bottom line is that some combination of taxes and spending are going to be necessary to come anywhere near a fix and the current GOP is not willing to be realistic (in a way, btw, that Reagan and Bush 41 were).
I don’t disagree with the notion that the borrowing has to stop (or, realistically, be substantially diminished, but that is another discussion). However, your attempt to make the argument that the Dems are just as recalcitrant as the Reps at the moment simply doesn’t hold water. And I am not pleased to be in the position of defending the Dems, but I have to go with what I see to be true rather than what I want to be the case.
@Donald Sensing:
And that is the same problem with the Bush tax cuts, btw.
@Donald Sensing:
He’d be a pretty lousy negotiator if he did. Remember it was not his first choice to cut that 10, it was what the 1 bought you. And no, you don’t get 9 for free.
@Donald Sensing:
I was saying that the Reps utterly refuse to use one key tool in managing fiscal policy, i.e., tax cuts.
You were saying the the Democrats utterly refuse to use spending cuts and only want to raise taxes.
Not to put too fine a point on it, but on the facts I was right and you were wrong.
That, of course, does not solve our fiscal issues, but it is nonetheless and empirically verifiable statement.
Okay, going into the details kind of defeats the purpose of making an analogy in the first place, but hey if that’s what you want let’s go there, but let’s do it accurately.
Sure, you don’t have a job that earns money, but your neighbors all agreed that you should perform certain services for them, like patrolling the neighborhood for criminals, keeping pests at bay, fertilizing the lawns, etc. Furthermore, some part of your neighbors will get a living allowance paid for by your other neighbors, and it’s your job to see that these payments are made. Worst of all, your neighbors want you to engage in hostilities with a couple of other neighborhoods.
Now because paying for these hostilities is expensive, and you can’t wait for the neighbors to get you the money for a new garbage throwing catapult when your daisies are at risk, they all agree to issue you a credit card to temporarily make up for a lack of cash. They all agree that the card will be paid off once the costs of hostilities and services goes down, or the overall wealth of the neighborhood increases.
Only as the cost of services goes down, the neighbors insist on paying less, and when the wealth of the neighborhood drops, the neighbors insist on getting more services to help them through the rough time. All the while you have to keep the rest of the suburbs subdued by your massive trash-chunking war machine otherwise they’ll all gang up on yours. So you end up maxing out the credit card. But the neighbors don’t like the idea of handing over more cash, or getting fewer services, so the whole neighborhood agrees to get you another one. And another one. And another one.
Then one day a few of your neighbors decide that you’re spending too much, and refuse to vote for a new credit card. They also refuse to pay more to cover the costs of services, and when you ask them what services to cut, they can’t name anything besides the $50/year spent on potted plants at the neighborhood entrance.
But you’re a responsible neighbor who loves his community and wants to protect it, so you agree to cut payments to the elderly, reduce lawn watering to the minimum required to keep the grass alive, ending the yearly easter, halloween and christmas parties, and winding down the attacks on the folks on the other side of the tracks. In exchange, you ask for an extra $1 per person so you can make the monthly minimum credit card payments.
But a small handful of your neighbors refuse to pay the extra $1.
They also refuse to let you cut payments to the elderly.
They also refuse to let you stop buying rubbish hurling robots.
And they still want their holiday block parties.
And then they call you irresponsible.
@Michael: Indeed.
@Donald Sensing: Deficit spending by the federal government does not “borrow from children” or from the future. The government doesn’t need to raise revenue from taxing or selling bonds at all: issuing debt is just a method the feds use for hitting the target overnight rate. The federal government is not revenue constrained.
@Steven L. Taylor:
By no means am I defending the Republicans’ record on borrowing. I slammed Bush for it repeatedly on my own blog, one link I posted on another comment (here).
Yet Bush was a mere piker compared to Obama. Steven, there have been no cuts of spending. There have been only cuts in the rate of increase. The deficit remains, and remains huge for each year of the next 10. The only reason the Democrats passed the bill was because (a) they got absolutely no backing from the president not to and no alternative plan from the White House, as they admitted, and (b) the bill passed the House and Senate Democrats could either pass it or not – and if not, there was nothing else to pass before deadline.
The Republican position never was tax cuts this year, it was no new tax increases. Them’s the facts.
BTW, I also wrote in 2003, “I do not believe Bush’s domestic policies are in the best interests of our long-term freedom. I do not think that Bush’s domestic legacy will, in the long run, be good for the country,” and more.
So nice try pulling the “Bush did it” card on me, but no cigar.
@Donald Sensing: You are tying to change the subject.
Again: all I said in the post was that Republicans have, of late, become extremely rigid on the tax issue to the point of it being an article of faith.
You did no address that, and tried to turn it around and say the converse about the Democrats, i.e., that they only want tax increases.
I clearly demonstrated, by a series of examples, that your assessment was incorrect.
I am not sure why that is so hard to admit.
@Michael:
And while you are doing all these wonderful things like cutting lawns and sweeping up trash and occasionally invading other neighborhoods, you are also mandating the tiniest minutiae of the neighborhoods’ order of living, such as how high their fences can and of what material, what kind of grass they can plant, what color they can paint their homes, what kind of light bulbs they can use, what fuel efficiency their cars have to get. You also mandate that they have to buy certain services from businesses that you are already regulating to the eyebrows.
As for all this money you are handing out to the elderly, you running up the credit card to do it at an ever-increasing pace until the people who are still giving you money every month figure out that there won’t be any for them when they get old, and besides, you bury recipients of your largess in so much paperwork and regulatory red tape that it’s impossible for most of them to figure out whether you’re living up the rules you wrote.
Don’t forget, too, that you are very choosy about who gets other monies you hand out – you funnel it to the people who contribute to your private funds that you use for your personal use – never forgetting, of course, that you pay yourself from the general fund double what the average neighborhood resident brings home – and there are some sectors of the neighborhood that are always favored over others.
Oh, yeah – 47 percent of the people pay into the general fund not one thin dime, but depend in enormous measure on checks that you write them from the general fund. You make it plain to them that their checks will stop if you hand over power to anyone else. This is a good deal for you because their dependency on you ensures they will never stray from the reservation when it comes to supporting you.
—————————-
But you are right about one thing- who will be first to say, “Cut the funding for the programs I receive?” Nobody, that’s who. As I wrote in 2010,
But then, they are dealing with a government that (regardless of party) sees us as the problem. Democrats and Republicans are united in one political-class worldview: America is a problem to be fixed and Americans are a people to be managed.
As for we the people, we have become addicted to the dole, whether it is receiving welfare directly or being upper-class beneficiaries of tax breaks for the favored. We ideologically approve cutting the budget but operationally don’t want it done on our own backs.
Yes you are. But then again, you’re not an autocrat now are you? No, your authority to do these things comes from the majority vote of your neighbors. A majority that keeps voting in favor of you doing these things.
And yet you’re still being paid less than half of what they would be paying you if you were the CEO of a private company that they had to hire. Also never forgetting that every 2 years the entire neighborhood gets to decide if they should let you keep doing this job.
Yup, the majority of your neighbors decided a while back that the elderly, kids, and unemployed shouldn’t have to pay towards the upkeep of the neighborhood. Then over time the large middle-aged part of your neighborhood got old enough to retire, and 1 in 10 of the remaining households lost their jobs.
Then some people got mad at the others for getting old or losing their jobs.
And those same people called you unreasonable.
@Michael:
You’re joking, right? You have to be. Do you really think that the 47 percent of people who pay no income tax at all consists solely of the elderly, kids and unemployed?
Even CNN rebuts that.
“I do not think a Republic can survive when those who pay little or no tax determine the size of government and the entitlements to the citizens. I do not want to encourage a society in which all men are paid for existing, and no man must pay for his sins – or for his dinner, for that matter.” — Jerry Pournelle
@Michael:
Oh, yeah: “No, your authority to do these things comes from the majority vote of your neighbors.”
And now that the majority is turning toward removing this authority and the reducing the funding that you use to regulate them, and are voting in increasing numbers that way – well, we just can’t have that, can we?
That’s the Left: the majority always gets its way unless its way is not the Left’s way. Once the majority cedes authority to the government, they must never be allowed to take it back. Once any facet of American life is brought inside the state’s control, it must always stay there, for there eventually must be nothing outside the state.
No, but they’re part of that 47% aren’t they? The rest of made up mostly of people who make so little income that the number of credits and exemptions wipes out their taxable income. The number of people who don’t pay because they’re somehow cheating the system is pretty small. That number itself is also a relatively recent thing, combination of the Bush tax cuts and credits as well as the stimulus programs.
I’m all for it, actually. If you don’t like the spending, vote to stop spending. What I have a problem with is people who won’t vote to stop spending if it contains even the smallest amount of new revenue. If those people actually believed that spending was a problem that needed to be fixed, they’d be thrilled to get a 10:1 ratio of cuts. Anybody who refuses that because it contains a small increase in revenue isn’t serious about cutting spending.
@Steven L. Taylor:
According to the CBO, the tax burden for people at the 44th centile or above increased substantially after the Bush tax cuts went into effect. The tax burden of everyone else fell. Meaning the less money you made, the less of national tax burden fell on your shoulders.
As for the Bush tax cuts “costing us” billions, federal revenues increased 14.5 percent in 2005 (the year after the cuts were made law) and 11.8 percent in 2006, the fastest rise since 1981. And everyone’s tax rate went down, no matter their economic class or income bracket.
When the Democrats finally agreed to leave the Bush tax cuts in place – which means they left the tax code unchanged – they simultaneously screamed that it was a tax cut for the rich. But no one’s taxes were cut at all.
What the Democrats are really saying that high tax rates are to be normative and anything less is aberrant and wrong.
I don’t see why that is so hard to admit, especially the verbal legerdemain Democrats use when they talk about tax “cuts.”
@Donald Sensing: Let try one more time, as I feel as if you are having an argument with me that I am not having with you. Perhaps I have been insufficiently clear.
The only point the post itself was making was that I find it problematic that the current GOP treat any kind of revenue enhancement/tax increase as utterly impossible to even discuss. Since we do have long term fiscal problems, as well as demands for services that are expensive, then it is reasonable to consider changes to tax policy, including tax increases. There are also practical political issues linked to the need for compromise that are relevant as well. At a minimum, I came to the position a while back that any talk about long term fiscal policy that does not include bother spending cuts and revenue increases is fundamentally unserious (I used to be more in your camp. btw).
To the notion that we can only fix our problems with spending cuts alone, rejecting even in ratios of 10:1 cuts to tax increases, I said:
You countered with:
I noted that not only has Obama not raised taxes, there have have been cuts in taxes plus cuts in spending. This makes your statement incorrect.
Now, one may not like the policies or think that the cuts are inadequate or argue over the substance of the policy. All well and good–I even agree on some points. But that is not the argument we are having. The argument, as you framed it, was a claim that Obama will not cut and will only seek to raise taxes. This is simply not true.
BTW, a side note that I find curious: you don’t think we should raise taxes, but you also complain that a substantial portion of the population does not pay income taxes. How do you reconcile that position? (This is a sincere question). On the one hand, if you think raising taxes is problematic as a general proposition, you should be happy that there are a substantial number of people not paying income taxes. On the other hand, given our fiscal situation (and because you imply these people are on the dole or exploiting democracy) shouldn’t these people pay income taxes? It is a conundrum that I often see, but never see anyone explain.
@Steven L. Taylor:
See here.
@Donald Sensing: And which taxes should count towards representation? Income only? Sales? Import? Property perhaps?
@Donald Sensing: The problem with the focus on income taxes is that it ignores payroll taxes (which for practical purposes are income taxes as well).
It also ignore a host of other taxes.
While I concur that the income tax we have is screwed up and needs major reform, it is radically problematic to focus solely on income taxes and make claims like “representation without taxation” since anyone who draws a paycheck pays payroll taxes.