Which Party Cares More About Deficits?

Jonathan Chait points out, correctly, that the politics of the past 20 years has been a politics in which it is clear that the Democrats care much more about the deficit, and take many more steps to decrease it, than Republicans do. Here’s a snippet:

The story begins in 1990, when George H.W. Bush decided to compromise with Democrats in Congress and sign a major deficit reduction law. The deal contained significant cuts in spending, along with a small hike in the top tax bracket, and pay as you go budget rules requiring that any entitlement increases or tax cuts have offsets to make them deficit-neutral. Conservatives revolted, voting en masse against the deal — just 10 House Republicans supported it — despite a full-court lobbying effort by Bush. The deal is still remembered as a betrayal by Bush and the prototypical example of how a GOP president should not govern. Every major adviser associated with the deal from Bush’s side has since been purged from the party.

[…]

Once Republican George W. Bush took office, Clinton’s veto was gone, and Republicans immediately began dismantling the bulwarks of fiscal conservatism. They ended the pay as you go budget rule, and passed a series of large tax cuts. They also passed a Medicare prescription drug benefit, also unpaid-for, and major military and homeland security spending increases. Much of the criticism over the enactment of these policies, especially the 2001 tax cut, centered around the durability of the surplus, which Democrats called uncertain, and Republicans insisted was bound to continue growing.

To be sure, Democrats are hardly perfect on the fiscally conservative score, but they have actually made efforts. Republicans, on the other hand, talk a big fiscally conservative game, but when it comes time to put their money where thier mouth is…. most of them don’t. And the few that do? They get purged out of the Party.

FILED UNDER: Campaign 2010, Economics and Business, Quick Takes, Taxes, US Politics
Alex Knapp
About Alex Knapp
Alex Knapp is Associate Editor at Forbes for science and games. He was a longtime blogger elsewhere before joining the OTB team in June 2005 and contributed some 700 posts through January 2013. Follow him on Twitter @TheAlexKnapp.

Comments

  1. Joe Callan says:

    I was thinking the answer would be “whichever party isn’t in power at the time”.

  2. Drew says:

    Thanks for the comedic relief, Alex.

  3. Jeff says:

    did Chait mention the Clinton surpluses ? you know the spending bills the Republican congress put on his desk to sign …

    nice cherry picking … only go back to 1990 for your data … and then ignore the spending bills from the Republican Congress … did he mention the spending bills written by Nancy Pelosi since 2006 ? No … even more cherry picking …

    keep running with that theme … Democrats are spending cutters, always have been, always will be … just ignore 2006 to present …

  4. Alex Knapp says:

    @Jeff –

    Did you, you know, read the whole article? (Yes, the Clinton-GOP spending bills were mentioned.) The 1990 cut-off was used because this is a response to Megan McArdle’s claim that neither party is serious about deficits, and the timeframe McArdle used was 1990 – present.

    @Drew –

    Any issues with the facts presented?

  5. Ben says:

    Drew, that is quite the substantive rebuttal, there. Good job. Can’t argue with logic like that.

  6. Dave Schuler says:

    Neither party as such is interested in the deficit for any other purpose than to beat its political opponents over the head with.

    Be careful of reading too much into the surpluses during the closing years of the Clinton Administration. There are two reasons for that. First, the debt continued to rise. How is that possible if we were running surpluses? Second, whatever surplus there was was due to increased revenue as a consequence of the bubble of the late Clinton Years. Relying on bubbles is not a plan for fiscal prudence.

  7. Franklin says:

    I think Joe Callan’s answer is probably a bit more accurate in general.

    The real difference is simply how much each side thinks that government should be a part of our society. Democrats pretend to try to balance the budget by raising taxes. Republicans pretend to try to balance the budget by cutting spending.

  8. Drew says:

    “Any issues with the facts presented?”

    “Drew, that is quite the substantive rebuttal, there. Good job. Can’t argue with logic like that.”

    I’m too old, wise and experienced to waste time with garbage, selective data, and spin presented as “fact.” Spare yourself the public embarassment……………or not.

  9. mantis says:

    I’m too old, wise and experienced to waste time with garbage, selective data, and spin presented as “fact.”

    You’re not going to bother presenting us with garbage, selective data, and spin? Fine, have it your way.

    Spare yourself the public embarassment……………or not.

    No, you’re a little too late for that. You’ve already embarrassed yourself.

  10. Robert in SF says:

    @Franklin:

    *Republicans pretend to try to balance the budget by * allegedly* cutting spending, but actually don’t.

    FTFY

    Just because you don’t spend money on certain programs doesn’t mean you cut spending…considering you spend that same money and more on other programs.

    @ large:

    And a personal pet peeve around points/counterpoints: the term “taxes” is used waaaaaaay to generally to be of any use in a discussion/debate about facts and history.
    Do you mean payroll tax, capital gains tax, dividend tax, tax credits, tax deductions, federal income tax, property tax, state income tax, county, city, local tax?

    I would love to find a quick and easy, citable, sourcable reference to the federal income tax, capital gains, and dividend tax rates and which Party supported those changes in rates….Anyone know of one?

  11. Drew says:

    Heh. The “deal” struck between Reagan and Tip O’Neil was that Reagan got his tax cuts, and O’Neil would cut spending.

    Never happened. Spending just kept going up. Look at the Clinton years. All the “spending reduction” was defense – the peace dividend – but the social spending juggernaut just kept going.

    Those of you who actually believe that Dems are deficit hawks have my true sympathies. You poor dears.

  12. sam says:

    I don’t about that last. This from William A. Niskanen, chairman of the Cato Institute, writing in The Concise Encylopedia of Economics, Reaganomics :

    President Reagan delivered on each of his four major policy objectives, although not to the extent that he and his supporters had hoped. The annual increase in real (inflation-adjusted) federal spending declined from 4.0 percent during the Carter administration to 2.5 percent during the Reagan administration, despite a record peacetime increase in real defense spending. This part of Reagan’s fiscal record, however, reflected only a moderation, not a reversal, of prior fiscal trends. Reagan made no significant changes to the major transfer payment programs (such as Social Security and Medicare), and he proposed no substantial reductions in other domestic programs after his first budget.

    Moreover, the growth of defense spending during his first term was higher than Reagan had proposed during the 1980 campaign, and since economic growth was somewhat slower than expected, Reagan did not achieve a significant reduction in federal spending as a percent of national output. Federal spending was 22.9 percent of gross domestic product (GDP) in fiscal 1981, increased somewhat during the middle years of his administration, and declined to 22.1 percent of GDP in fiscal 1989. This part of the Reagan record was probably the greatest disappointment to his supporters.

  13. ratufa says:

    It’s in the Democrats’ interest to have a functioning “welfare state” (i.e. Social Security, Medicare, ObamaCare, various safety-net programs, etc) that exists in the long-term. That’s their schtick, after all. They’re willing to raise some taxes and tinker with these programs (e.g. the Medicare cuts that Republicans complain about) in order to keep them running. But, it’s not clear that they have the political will to do the necessary tax hikes and program changes to maintain long-term solvency.

    Republicans have some influential constituencies that want to cut taxes, dismantle the welfare state to varying degrees, “starve the beast” and otherwise shrink government. But, it’s not clear that they have the political will to balance the demands of these constituencies, particularly with respect to taxes, with the political reality that parts of the welfare state are hugely popular with many Republican voters (as all the Republican campaign ads attacking Obama for cutting Medicare attest)..

    As to which party “cares” the most about deficits, I’d be more inclined to think the Democrats do, simply because they don’t have the same pressure from their voters to use deficits as a tool to shrink government, nor have they made some of the anti-tax commitments that Republicans have. But, as the above characterizations imply, how each party actually performs with respect to reducing deficits is a more complicated issue than just who cares the most.

  14. An Interested Party says:

    “Those of you who actually believe that Dems are deficit hawks have my true sympathies. You poor dears.”

    You should save some of that sympathy for the poor delusional dears who believe that Republicans are deficit hawks…