Who’s To Blame?

James Fallows at The Atlantic offers five reasons, in his view , that it’s the fault of the GOP.  Let’s take a look at them, shall we?

1) The debt-ceiling showdown represents hostage-taking, plain and simple. This is a “crisis” that need never have happened, regardless of which party controlled the White House. 

You wouldn’t know it from most news coverage, but there is no logical or legislative connection between the House Republicans’ stated object of concern, the future budgetary path toward national solvency, and the bonds and notes the Treasury must keep issuing for programs this and previous Congresses have already voted into law.

Not true.  Part of it deals with current debt — a massive chunk of which was piled up in the first two-and-a-half years of the Obama Administration, but I digress.  But the Democrats are insisting — dare I say, holding the entire deal hostage for — a debt ceiling that will allow them to pile up additional debt through to 2013.  Why?  No other reason than politics.

2) The House GOP position fails the test of basic knowledge. Last night I listened to a Tea Party member from the House explain why there could be no tax increases as part of the deal — raising taxes is the last thing you need in a recession. In the next sentence, he said that the main virtue of a proposed GOP plan, versus Harry Reid’s, is that it made deeper budget cuts right away, though even deeper short-term cuts were essential.

No one had pointed out to him, or he had forgotten, or he didn’t realize, that during a recession, raising taxes and cutting budgets are bad for the same reason. They both reduce demand and make a recession worse.

Not true.  If Keynesian economics worked, then Mr.  Fallows would have a point.  But the current Administration has rather effectively disproven that.  Massive increases in deficit spending by the government have strangled the economy, not stimulated it. 

So how about signalling to job-creators that they need not fear being sacrificed further to feed the government beast bu cutting spending and holding the line on taxes?  Better yet, cut and simplify them to diminish the opportunities for rent-seeking.  Then, the trillions in investable dollars sitting on the sidelines will come back into the game and, voila!, real growth will resume.

3) It fails the test of basic logic. Or perhaps basic knowledge part #2. If you look at the numbers, like the chart after the jump, you can see that budget-balancing involves a threshold choice. You can be for preserving tax cuts in toto, or you can be for cutting the deficit. But because the tax cuts have played such a major role in creating the deficit, if you have any regard for math or logic you really can’t be for both. But most House Republicans are.

Again, not true.  here’s a chart of federal spending as a percentage of GDP 2000-2011:

We have a spending problem, not a “revenue” problem.

4) It displays a lack of tragic imagination. Many on the right have talked themselves into the view that it would be no big deal for the U.S. to go into technical default for a while. And I am sure that the “disaster strikes at midnight!” scenarios about what would happen on August 2 are way overblown. But anyone who thinks this controversy has had no effect on America’s standing and assumed credit-worthiness, or that an actual default, whenever it occurred — in late August, in September —  would not hurt us in the short and long run, needs to get out more. Out into the world, where assessments of basic American steadiness are now being recalibrated.

Actually, I think that default would be bad, though the effects would be largely temporary.  But see the above chart.  Does anyone — other than the President, who proposed a budget way back in February of this year that would have accelerated the climb — think that ski slope of federal spending can continue? 

A technical default is not a good thing.  But continuing the current binge of spending on an unsustainable course will cause structural instability.  And that is a very, very bad thing.  The liberals who can’t see that, or who think we can tax our way out by confiscating the income of high-earners while regulating the hell out of the American economy, are delusional.

5) It has turned into zealotry, by which I mean utter disregard for the practical consequences of acts.

I must have missed the part where the Democrats put ObamaCare on the table.  Oh, they didn’t?  Silly me, they are so non-ideological and reasonable I just assumed they did.  By the way, the “practical consequences” of ObamaCare can be seen here:

Fallows is simply channelling Obama here.  President Present simply decides — does that mean he’s “The Decider”? — that his position is reasonable and everything else is a political talking point, ergo, he is being reasonable and everyone else is partisan or ideological in pursuing their own goals.  See how that works?  Actually, it only works with a supine media.

 

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Published in: on July 29, 2011 at 10:47 am  Leave a Comment  

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