It doesn't seem as though many folks have been paying attention over the last year, but if you have, you might have noticed that supply-side economic orthodoxy has died in the Republican Party. And you know what, that's fine with me.
Supply-side was always patently silly. Every time that it's been implimented, giant deficits have resulted. That was true under John Kennedy and Lyndon Johnson in the 1960s. It was also true under Ronald Reagan in the 1980s, when the deficit actually tripled. And I think we all know what happened with George W. Bush over the last decade.
"But," I'm sure that my GOP book-licking friends are screaming at their monitors right now. "None of those presidents are pure supply-siders. Supply-side economics requires spending cuts equal to, or greater than, the tax cuts to actually work." And that's how supply-side is exactly like Marxism. Both are fine in theory, but impossible in practice.
This is because politicians are lazy and voters are, for the most part, delusional and idiotic. Each and every practicing politician alive today understands that the easiest way to win your vote is to buy it. And if you're too old or poor to benefit from a tax cut, by God, they'll throw a shit-ton of program spending your way to keep you happy and voting early enough to make the exit polls look good. Voters expect it, and politicians of very ideological stripe are more than happy to oblige them.
The difficult part for Republicans to admit is that supply-side can't help but cause catastrophic debt that way.
While I'm freeing you of illusions, let's once and for all banish the horseshit idea that Obama's deficits are worse than Bush's. I'll begin by conceding that Obama's look worse than Bush's ... if you're an economic illiterate. Or a partisan, shit-hell fucktard. Virtually every allegedly "conservative" blogger and talking head spin doctor alive falls into one of those two categories. They're either liars or retards.
To understand what I'm saying, you need to understand that not all deficets are created equal. There are structural deficts and non-structural deficits. Most of Barack Obama's deficit came from his ill-considered stimulus package in 2009. As was the case with Bush's Troubled Asset Relief Program, that money's been spent, and there's little likelihood that there's gonna be much more of it coming down the pipeline. Because it constituted mostly one-time spending (which was the chief complaint among Republican governors), it was non-structural deficit spending.
Structural deficit spending is a different beast entirely, in that it's almost impossible to kill. As we learned in 2009, even giant Democratic majorities weren't enough to repeal a tax cut, even a repeal that targeted a very small percentage of the overall population. (In the interest of full disclosure, I support repealing all of the Bush tax cuts, including those for the middle class.) That's structural deficit spending, and the 2001 and '03 tax cuts alone account for about $4 trillion of it a decade.
When was the last time entitlement spending for the middle class was voted away? If you answered "never", you just won yourself a cookie. Therefore, only acid fiends think that programs like Medicare Part D - at a cost of about $700 billion a decade (or nearly all of Obama's stimulus cost) - are going anywhere.
Then there are the wars, and this is where I get really cold, so forgive me in advance.
Because of miraculous advances in combat medicine, soldiers that would have been dead in previous wars aren't today. Particularly in the case of serious head wounds, which a large percentage of the casualties sustained in Iraq and Afghanistan are. But those so wounded are still all fucked up. In some cases, terribly so. If you assume that a wounded 22-year old is going to require care for the rest of his life, and lives until he's at least sixty, you're talking about some pretty serious money. Just caring for the seriously wounded, particularly from Iraq, might actually double the cost of the war over the next forty to sixty years. And, friends, that's structual spending.
You could argue that all of the miltary material that was used, blowed up or just worn out in Iraq and Afghanistan could be replaced at once, but that would make you look stupid. Moreover, almost no one is seriously discussing changing U.S foreign policy in a way that would avoid replacing all of that material.
Long story short, the second President Bush could barely get out bed in the morning without engaging in the hardest of hard core structural deficit spending. Outside of health care, Obama's single largest example of structural deficit spending is pledging to continue the Bush tax cuts for the middle class. There's just no contest. And almost everything Bush did in office cost almost as much, as much, or more than the Affordable Care Act. That doesn't mean that I like the health care law, but the numbers are hard to hide. Worse, Bush's spending is of the sort that is somewhere between difficult and impossible to stop.
Keep in mind also that most of the structural deficits were enacted under unified Republican control of the government. The GOP no longer has the excuse that they used to justify the fiscal excesses of the Reagan years, a Democratic Congress. The biggest ticket items Bush passed between 2007 and 2009 were TARP and the 2008 $150 billion tax rebate stimulus, both of which were one-time expenditures. The serious money vanished between 2001-'05. And titanic fuckheads like Grover Norquist were silent about that spending when they weren't actually shaking their pom-poms for it.
As much as the spending makes me crazy, the hypocrisy makes me physically vibrate with indignation. If you shoot your average Republican politician full of sodium pentathol, give a few drinks and a teenage boy to fondle, he'll tell you that spending shit-tons of money is the best way to get re-elected without working very hard. And anyone who knows anything about John Boehner knows that he doesn't like working very hard.
But you can't put your pants on in the morning without seeing those assholes storming the barricades and screaming about fiscal responsibility. The rhetoric is a cheap pose for the yokels, to be sure, but thirty years of it has taught the American people that money isn't something to be taken seriously. I think we can all see how well that's working out for their economy today.
The good news is that no one in the GOP is even discussing supply-side as a serious policy option anymore. Sure, they like pulling out their dead Reagan puppet like some nostalgia act, but they've completely abandoned supply-side as a theory.
It's important to remember that supply-side dictacted accross the board rate cuts, which would presumably create growth without deficits. Because they pay greater percentages of their income in taxes, of course the rich would get the biggest cuts. That only makes sense under supply-side theory.
But you almost never hear today's Republican Party advocating that any more. Instead you hear an almost violent railing against the 47% of Americans that don't pay federal income taxes at all. Never mind that most of that 47% is either too poor or too retired to pay those taxes, because class warfare works just as well for Republicans as it does for Democrats. In fact, it works better for the GOP.
Oh, it's also important to forget that the 47% pay into the most regressive parts of the tax code. President Reagan doubled payroll taxes in 1983, which the working and middle classes can't escape, but the wealthy have a cap on. And the cost of corporate taxes are passed on to the consumer in increased prices, which is effectively a tarriff by another name. They also pay state and local taxes.
Since Steve Forbes introduced the idea into the popular vocabularly in 1996, the GOP has had a major fetish for flat taxes, which has become orthodoxy in the last year. Both Rick Perry and Herman Cain have some variation of a flat tax in their economic platforms, both of which are silly and both of which actually raise taxes on the majority of Americans. That populist Tea Partiers, most of whom are lower and middle class, love these ideas is all the proof you need that populist Tea Partiers are functionally retarded.
Firstly, any economist that isn't crippled by either a huge drinking problem or paralyzing stupidity will tell you that for a flat tax to work, it would need to set at about 27%, without deductions. Neither the Cain or Perry plans come close to that. Both are riddled with the childish deductions that Americans have come to know and love.
Second, neiher touches entitlement or defense spending in the near term, which is where the real money is in the budget. If you look at Paul Ryan's plan as a yardstick, as both Perry and Cain seem to, there are no serious spending cuts wothy of the name for at least 15 years.
However, unlike the Ryan Plan, the Cain and Perry schemes provide an immediate and gigantic tax hike on most Americans.
The famous 47% that don't pay federal income taxes at all right now will be expected to pony up either 9% or 20%, depending on which plan you look at. And that will presumably be on top of their federal payroll, state and local taxes. Cain's plan in particular mandates an immediate 18% tax hike (through the flat sales and income taxes) on the 47% upon enactment.
And Erick Erickson's self-celebrating "53%"? Almost all of them will being paying more in taxes, too. Yes, the top one percent of them will have a rate cut from about 37% to either 20% or 9%, but almost all of the rest of them will face a pretty significant increase in taxes. Keep in mind, they'll still be paying payroll, sate and local taxes, too.
Sure, capital gains and estate taxes will vanish in most of the GOP's most hyper-sexualized fantasies, but only a very small percentage of Americans pay those at all right now. On the other hand, they drive a shitload of revenue. That burden will necessarily be shifted to the lower and middle classes, but not all that efficently. Always remember that 9-20% of shit is still shit. For example, let's assume that half of the 47% are Social Security receiptients. So far as I know, no one is seriously suggesting taxing benefits or, god forbid, cutting them at all.
If you're reading this, the odds are overwhelming that the Republicans will be "spreading the wealth around" just as much as they accuse Obama of planning to. And it will be your wealth that gets spread around, just not in the Christian "help the poor" kind of way. It's the same kind of economics that were behind TARP, but without the benefit of saving the entire financial system of the United States from collapsing around your ankles.
Other than Ron Paul, no Republican is thinking of ways to change U.S foreign policy in ways that would drive defense costs down. Dwight Eisenhower's "military industrial complex" will continue to grow and syphon the wealth of the nation to no real benefit to the average citizen. And no one is thinking of ways to reduce entitlement spending in the near-term, meaning current beneficiaries, or those who are about to be, who are the real fiscal problem.The fucking Boomers, who actually are the problem from an entitlement sense, are spared any pain at all. Those unfunded liabilities remain untouched under any Republican plan.
The supposedly conservative, Tea Party wing of the GOP is effectively a second "tax and spend" party. Deal with it. Or not. Whatever.
I don't remember the Bill of Rights including a right to remain utterly ignorant of math, yet still remain prosperous, but I suppose that the Republicans will sponsor a constitutional amendment addressing that before next November.
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