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What the Republican Primaries of 2012 Are Telling Us

January 30, 2012

One tie, one win, one loss… and now, on the eve of the Florida primary, Willard Mitt Romney appears to be coasting toward his party’s nomination. At least that’s what the professional soothsayers are telling us, and I won’t dispute their wisdom even though the actual nominating convention is still seven long months away.

With Newt Gingrich fading fast, nobody in the current G.O.P. field seems poised to deal the recently reinvigorated Romney a death-blow. It’s unlikely that he’ll crack under the strain of campaigning or abscond to the Bahamas with a Venezuelan mistress. He won’t run out of cash, either.

Barring a Tea Party insurrection at the Republican convention in Tampa this August, the Mittster will walk away as the G.O.P. presidential nominee. He’ll earn the right to joust with President Obama and knock him off his horse, though nobody is really excited about his candidacy.

So how does such a plain vanilla contender emerge as the standard-bearer for the party of Lincoln, Teddy Roosevelt and George W. Bush? The same way that such tepid warriors as John McCain, John Kerry, Michael Dukakis and Walter Mondale won their respective nominations: the quirkier candidates self-destructed (remember Howard Dean’s primal yell?), and the bland survivors diligently collected the most delegate votes during the primaries.

Sometimes I wonder if we shouldn’t return to the days when a convention was more than a coronation… when sweaty delegates bickered behind closed doors in the sweltering summer heat, tempers flaring in a heavy haze of cigar smoke. At least there was a little suspense, and we never knew if the delegates would pick a Franklin D. Roosevelt or a John W. Davis.

But since 1972, when primaries became binding (as opposed to mere “beauty contests” to test a candidate’s viability), we’ve gone the democratic route in selecting party nominees. It seems fitting and proper, and yet…

For me at least, the 2012 G.O.P. primary season has exposed some glaring flaws in the system. But I’ve seen one or two bright spots, too. What have these contests been telling us?

1. It pays to have money. BIG money. Romney is a self-made mogul, of course, and Gingrich is loaded, too — though not to the same order of magnitude as the former head of Bain Capital. But Gingrich’s friend and supporter, billionaire casino tycoon and ardent Zionist Sheldon Adelson, is even more loaded than Romney. Both Romney and Gingrich also benefit from superfunded Super PACs — those cleverly conceived “independent” political action committees made possible by the Supreme Court’s notorious Citizens United decision. These Super PACs can now collect unlimited contributions from “anonymous” donors and spend liberally (not a dirty word for Republicans in this context) to maximize a candidate’s exposure. Under the current system, we’ll never choose a candidate who challenges the system. And of course that’s precisely how the big-money interests would have it.

2. Money seems to buy votes. You’d think that American voters would favor the candidates who impressed them during the recent debating season. You’d think they’d know each candidate’s virtues and foibles by now and have their minds made up. But no… apparently voters are responding to the candidates who campaign most vigorously in their own state. Example: Gingrich put tremendous money and effort into his South Carolina campaign — and guess what? He won. Are voters really so impressionable that a rousing round of pep rallies, baby-kissing and distorted TV ads will brainwash them? The answer is yes. After all, these are the same folks who watch “Jersey Shore” and buy products emblazoned with the magic label “AS SEEN ON TV.” We trust the wisdom of the people, though lately I have to wonder what they’ve been imbibing. As Churchill said, democracy is the worst form of government — except for all the others.

3. Early votes count more than later votes. We’re looking at the fourth contest of the primary season, and yet Romney is already poised to lock up the nomination. What about the other 46 states, you ask? Don’t their votes count? Well, yes and no. They still have to go through the motions, but nobody wants to vote for a prospective loser — with the possible exception of Ron Paul’s fan club. In short, the early primaries count more than the later primaries when it comes to making or breaking a candidate. Unfair? Sure it is. Wouldn’t it be better if all fifty states held their primaries or caucuses on the same day? Of course it would. If all the states can vote for president on a single day, they should be able to choose their party’s candidate the same way.

4. Republican voters were wise to reject fringe candidates. Rabble-rousing right-wingers Michele Bachmann and Rick Perry took the hint and bowed out in the early going. Rick Santorum and Ron Paul are still standing, but they’re no more likely to win the nomination than a turkey is likely to fly nonstop from New York to Seattle. Republicans can choose to make a statement with an uncompromisingly conservative candidate — the way they did with Barry Goldwater back in 1964 — and go down in uncompromising flames. Or they can pick someone of a less ideological bent who actually has a fair chance of capturing moderate votes.

5. Obama is looking stronger all the time. Sure, he’s better at making promises than keeping them. He’s inclined to dither when he needs to lead. And he’s inexplicably tight with Wall Street elites, especially for someone the conservatives love to denounce as a “socialist.” We’re still at war, and the American economy still isn’t looking stellar. But the president has slowly been gaining an aura of invincibility as every single G.O.P. “flavor of the month” candidate has tripped and fallen. The elusive shape-shifting Romney remains upright, but it’s hard to see how a slick representative of the “one percent” can make a case for himself while an increasingly disgruntled middle class still groans under the weight of economic distress. Romney seems the very embodiment of the new haute-capitalist class: more of a shrewd manipulator than a job creator. As for America’s working class and poor, they’re unlikely to vote Republican this year or any year — unless they fall for the misty-eyed G.O.P. notion that America consists of the rich and the “soon-to-be-rich.” Of course it was never true, but something tells me it’s even less true today.

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90 Comments leave one →
  1. January 30, 2012 6:53 pm

    Am I the only one who’s bored with the Republican debates? They focus more on goading each other than on making statements showing how they’re going to improve the economy. We need to get the big money out of campaigns so people that represent the majority of Americans can run and have a chance at being elected. Good article.

    • January 30, 2012 8:54 pm

      Auntie D: The debates just go on and on, don’t they? One observation I should have made in this piece: the Repubican candidates’ capacity for eating their own. I enjoyed the attacks on Romney as a “vulture capitalist” — this coming from GOP contenders! Obviously they’ve failed in their attempt to devour him, though. And of course you’re absolutely right about the need to get big money out of politics. This is the root of all political corruption, and it’s why our government is now being run on behalf of financial elites instead of the voting public.

      • Kent permalink
        January 31, 2012 12:51 pm

        Rick,
        Yes, Yes, get rid of Corporate donations. Corporation n.: An ingenious device used to promote individual profit without individual responsibility.

        Romney is just being “groomed” to deal with Obama. It won’t be too long that the “Gingrich dandruff” will be removed from Romney’s collar.

    • January 31, 2012 10:36 am

      Too much of the debates are driven by media questions or media selected questions.

      They do not accurately reflect what Republican voters are interested in hearing.

      The media questions focus on personalities rather than issues.

      The media asks: Gov. Romney do you stand behind your add calling Speaker Ginghich a “dirty rotten horsetheif”

      What we want is Please explain exactly how you intend to govern, how you will address issues such as healthcare, the deficit, ….

      The press at best phrases these as, people are suffering they … show us you care.

      I would prefer a president that actually understood less about the political process and more about the economic one.

      • Kent permalink
        January 31, 2012 12:54 pm

        I prefer more of a debate using average people. Random people in random town hall on t.v.

        Let’s see how they really handle the American frustrations.

  2. Priscilla permalink
    January 30, 2012 7:31 pm

    There have been a ridiculous number of debates, and, generally speaking, the questions have been dumb and dumber (“Governor Romney, would you support a state ban on contraception?” Huh??).

    On the other hand, seeing the candidates live, even in the American Idol style contests that we’ve endured, is a good way to see that they can at least articulate positions….or not, as in the case of Perry and Cain (9999999999). Although I don’t support Santorum, I have been impressed with his ability in the debates to articulate the social conservative position. Paul is funny and often pithy in describing economic issues, but gets a little crazy, IMHO, when the subject turns to foreign affairs. Romney has been excellent at appearing presidential and focusing on his strengths as a business and politcal leader, although he has not been able to convince the GOP base that he shares their values and Gingrich, up until the point that he became a raging prima donna, was effective in expressing grass roots/tea party anger at Obama.

    So, yeah, I am tired of them, and would prefer them to be over at this point, but I haven’t found them all to be boring.

    • January 30, 2012 9:02 pm

      Good summary, Priscilla, and I agree with nearly all of what you say. (You had to know there would be a “nearly” in there.) I actually found Ron Paul’s foreign policy pronouncements refreshing. They don’t amount to a viable or even desirable policy, at least not when carried to the extremes he proposed. But I think he struck a chord by pointing out the absurdity of our attempts to micromanage world affairs. We really do need to curtail our foreign adventures, especially when we’re so deep in debt. He probably wouldn’t approve of “nation-building at home” (since that would imply government action), but I think that’s where our priorities should be shifting right now.

      • Priscilla permalink
        January 30, 2012 11:11 pm

        Paul clearly strikes a chord….the problem is that he comes across as an extreme isolationist and somewhat of a naif regarding Islamist terrorism. At least he doesn’t support statehood for the moon, lol.

      • January 31, 2012 11:51 am

        I do not like to speak for Paul, but this isolationist meme is ludicrous.
        If you want a real isolationist go back to Pat Buchanan or early 20th century republicans (and many democrats).

        There is a big difference between – we need to stay out of other nations internal business, and we need to retreat across the ocean and ignore the problems of the world.

        I believe Paul has made it clear he supports the use of military force against acts of aggression.

        What more do you want ?

        What you are calling isolationism is the Bush/Neo-Con doctrine of pre-emptive war.

        As I recall one of his more famous one liners is “Declare war or go home”.

        If you want your eyes opened with respect to our foreign policy – read “The Ugly American”. that is about the errors in our foreign policy 50 years ago that resulted in Vietnam. Nothing has changed. We are fixated on the leaders in other nations, we are ignoring that our most valueable international relations asset is our success, and our people, and the strength of our ideas and ideals.

        What are the supposed extremes he proposes ?

        We will not invade anyone – unless/until they act in aggression against us or their neighbors ?

        We will follow the constitution and actually declare war when we are going to attack other nations ?

        We will quit providing massive foreign aide to both sides of the Arab/Israel conflict ?

      • January 31, 2012 12:06 pm

        The “extreme” positions that Paul holds that make him unacceptable within much of the GOP are not actually his views on foreign policy.

        What we are watching within the GOP primaries is the next phase of the battle for the republican soul. Romney represents a return to the Bush/Bush/Nixon axis of power. Neo-cons, so called GOP moderates who pay lip service to social and fiscal conservatism, who are nearly as statist as Democrats, who ultimately beleive that govenrment is a force for good and the answer to all problems. Except in the specific of policy choices they are indistinguishable from progressives.

        By virtue of being the last standing, Gingrich wears the mantle of the Tea Party. bit it fits really badly and there is not alot of enthusiasm.

        Paul’s great divide with the Tea Party is not over foreign policy, but over social issues like Drugs, Immigration, Sex. Though he has somewhat tempered his libertarian rhetoric on most of those issues – taking a Goldwater like federalist approach (turn the issue back to the states).
        That is not what social conservatives and to a lessor extent the tea party are seeking.

        But on each of these issues Paul is closer to the american mainstream than the GOP or the Tea Party (or TNM).

        Regardless, I do not think Paul is really focused on this election. I think his focus is on growing the libertarian faction of the Republican party, and future more libertarian candidates.

        I would also not that we have been calling Paul a nutcase for more than 30 years. Yet on myriads of issues, we – particularly republicans have adopted his positions. I do not think any republican since Reagan has had near as significant an effect on the debate and positions of the GOP, and possibly the nation.

    • January 31, 2012 10:53 am

      One of Romney’s fundamental problems (and to a lesser extent Gingrich’s), is that ultimately allot of us do not believe what he is saying.

      Voters – republican voters particularly are not happy. They are looking for someone who really believes in fiscal conservatism. Who really believes in small government. Paul is the only candidate that can credibly claim that, and he is too far from much of the GOP on social issues.

      I would note that while Romney is essentially a GOP version of Obama, and Gingrich is the consumate politician, every candidate at every debate has bent over backwards to demonstrate their fiscal conservative, small government cred.

      Republican voters know what they want, and the candidates know what the voters are looking for and are working hard to make themselves appear to be what the voters are after.

      The winner of the presidential election is almost certainly going to be dictated by the economy over the next six months.

      I would disagree with Rick that Obama is looking better and better. His negatives have declined slightly – because we have given up on him and are not listening.
      I ignored the SOTU, I had no expectation he would say anything meaningful, More important he will not do anything meaningful.

      The republican candidates are suffering from the same problem.

      We do not want to HEAR what you will do – our ears are tired.
      Read the Larry Summer’s 2008 economic plan memo. Though much is wrong with the plan, there was an absolute grasp that Pres. Obama needed to be fiscally conservative, that if he brought government and the economy under control, that both he and the democratic party would be unassailable for decades.
      Pres. Obama said many many things some of them were even good.
      In what he did – he failed. Unfortunately neither Gingrich nor Romney look any better, and Santorum is worse.

    • Kent permalink
      January 31, 2012 1:02 pm

      Let’s be clear. You can’t just pick up troops and come home without arrangements made within other countries.

      Families in Germany make a living outside the bases.

      Ron Paul is too direct and sounds scary when he says things, but I think when you have some common sense you can see around where is is going. Although, at his age he might be serious about not caring about the other families that support our bases.

      As for Romney, you can’t believe what any say. Just do your research and find out what they did as prior to running for political office. Character and they way they perform themselves says a lot. Ignore the gossip and put yourself in their shoes. What would you do differently.

      Romney and no other politician can make things happen unless the Congress agrees. Promises are a sure bet they are liars. They must say they will do what they can or do their best.

  3. Pat Riot permalink
    January 30, 2012 9:34 pm

    I think it’s awkward and embarrassing when the Republican candidates are attacking eachother on stage. Sometimes I cringe and can’t look. It seems too much like kids in the schoolyard to me, but they are potential Presidents of our country. God help us!

    • Priscilla permalink
      January 30, 2012 11:07 pm

      Oh, come on guys…you don’t remember “You’re likeable ‘enough,’ Hillary”? 😉

      Seriously, I agree, but I do think that this is in large part a result of the debate formats and moderators. So far, we have had questions about negative ads, Gingrich’s 2nd wife, Terry Schiavo (!!), how their wives would be as FLOTUS, who deserves the “mantle of Reagan” and a variety of other “will you repeat your attack on ______ here tonight?” questions.

      No questions that I can recall, at least no substantive questions, on Fast & Furious, the Keystone pipeline and energy policy in general, as well as our relationship with Canada, how each GOP candidate would have treated Mubarak, on the possibility of a peaceful solution to the Iran problem, and another question that David Frum suggested, which I think that most of you would be highly interested in: “If you knew then what you know now, would you have voted to invade Iraq?”

    • Kent permalink
      January 31, 2012 3:18 pm

      Debates are rather interesting. I like watching them after they are over. I just click on the CNN or MSNBC or YOUTUBE and watch what I want to see.

      I pick the part I like and watch. This helps me skip the “crap’ that is childish. Although, I would like to once in a while see the childish antics of a politician who can’t get his way or “goof’s up”.

      I remind myself that the debates are a “means” test. They have to be groomed before being put into the dog show.

  4. January 30, 2012 9:58 pm

    Pat: Can you imagine George Washington getting into one of those knock-down verbal scuffles? (Andrew Jackson or Teddy Roosevelt, maybe.) I have to say, though, that I’m impressed by the candidates’ relative composure under attack. I don’t know how I’d respond if I were in their place. I might wither on the spot… or be tempted to whack somebody upside the head.

    • January 31, 2012 10:54 am

      Go back and read about our founders. If anything the politics was far nastier then than now.

    • Kent permalink
      January 31, 2012 3:21 pm

      Rick, the verbal scuffles in the founders days were more vicious and slanderous.

      Newspapers said many lies and stories.

      The main thing is to get your point across and expose the other person in some negative way that makes the person uneasy or look unsuitable to be in charge of the country.

      • Pat Riot permalink
        January 31, 2012 8:38 pm

        I would like to run for President in the near future so that when my character is attacked during a live TV debate I can challenge the other candidate to a duel. I will reach into the podium and produce a handsome case which I will flip open to reveal two dueling pistols. The look on the other guy’s face would be all over Youtube. If he declined the pistol duel I would settle for a wrestling match, right there and then on stage. It would take a lot of money to get myself to that situation, but it might be worth it! After such a display, I suppose it would be time for a woman President.

      • January 31, 2012 11:13 pm

        Dave & Kent: Some of the things opponents said about John Adams and even Washington were so nasty they were hilarious. The insults of 2012 (“vulture capitalist,” etc.) come close but don’t surpass them.

        Pat: Dueling was an extreme response to insults, but sometimes I think we’ve gone to far in the other direction, where we’re just supposed to accept insults sitting down. I think brandishing a pistol now and then might be a smart idea.

    • Anonymous permalink
      February 2, 2012 5:59 am

      I think the reason debates seem more like fights than debates is that all the candidates speak from their positions most of the time. Newt Gingrich, whatever you think of him, tried to answer the charge that he was guilty of lobbying rather than being a “historian” to his clients, and collected too much money for his time, to boot. Guilty of lobbying? It’s a respectable career in Washington, D.C. and elsewhere. The trouble is, they all start pontificating, preaching on their own favorite themes, when they should answer the charges made against them by their opponents. That would really be a lot easier than trying to look and sound more profound than the next guy. It looks like they are tearing themselves up when they don’t just — answer. The thing is, I doubt that the Democrat party is more solidly together than the Republicans. Maybe the Republicans doubt themselves too much, even to the extent of giving up on their real agendas. They just seem shattered, or maybe that’s the effect of too many would-be candidates. Obama’s most unifying asset is, I think, that he is less a politician than the other Democrats. I bet Joe Biden is wondering how Obama did it (win the presidency).

  5. Rob Anderson permalink
    January 31, 2012 1:05 am

    Sorry to nitpick, but Howard Dean did not have a meltdown. He was the victim of a nicely crafted media ambush. That “scream” only seemed crazy because he was wearing a directional mic, designed to catch only sounds emanating from the object or person at which it is pointed. He was in a room filled with hollering, screaming partisans, and joined them in a hearty roar of his own. Not a damn thing wrong with that.

    Watching the news the following week, I could easily imagine Goebbels smiling up from Hell. The clip was repeated endlessly, and not ONCE did anyone mention that the only reason it existed was because he was wearing that type of mic. It was outrageous. Rick, you need to be more careful. You made this error in the same essay wherein you rightfully accused the American polity of being easily duped.

    • January 31, 2012 11:22 pm

      Rob: I was simply using the Howard Dean yell as an off-the-cuff example of the kind of momentary lapse that can snuff out a promising candidacy and allow a “safer” and blander candidate (like John Kerry) to go the distance. Yes, the media ganged up on Dean and turned a non-issue into a campaign-killer. I didn’t know about the microphone issue, though. Verrrry interesting…

  6. Dianne permalink
    January 31, 2012 1:32 am

    I agree, especially with #1 and that Obama will probably win. Gingrich needs to stop calling Mitt Romney a liar. Name-calling makes him look weak and silly. Romney is a success story made by the most recent recessions when a lot of people over 30 were invited to take $10-an-hour jobs to help the country get through it — again, and some people under 30 were stuck with expensive education loans and no jobs to match their dreams and ambitions. . How could they reward Romney with a win? i actually voted for Dukakis — the last time I voted for a Democrat. Absolutely nothing happened! I kind of slurked around as a victim for a while and then forgot about politics. That was a relief! Obama needs to stop behaving like a cartoon character. I can’t imagine which one he is, but he is cute! I like the sloth, Rick. It reminds me of Obama. I can just imagine Obama’s mother urging him to study: “I don’t enjoy this anymore than you do, buster” et cetera. Is that an accurate quote? If he wins, however, the good news is that it might be like a vacation from politics and more like a civics lesson. See iCivics online for civics games and materials. It was initiated by Sandra Day O’Connor as she was retiring, and it might teach us valuable lessons. Gene Koo of iCivics assured his audience on CNN that the games are actually fun and informative! If you know or can tell which cartoon character O is, let us know!

    • January 31, 2012 11:45 pm

      Dianne: I was probably the original sloth character. My parents used to nag me continually to get dressed faster, do my homework faster, stop dawdling and daydreaming. I remember us watching a nature documentary that featured a tree sloth inching its way along a limb, and my parents both chuckled because its movements reminded them of me. I wasn’t THAT bad… but I’ve always been a slow-moving guy… slow to assess situations and make decisions, too. I can identify with Obama on that score.

      Where did you see this sloth cartoon character, by the way? I checked iCivics, but all the characters there look human. Interesting site, by the way… I like the idea of turning government into a game!

      I

      • Anonymous permalink
        February 2, 2012 5:34 am

        Rick, It is a game, and the sooner we wake up to that, the better off we’ll be. I worked in Washington, D.C. one summer, and all I can say is that it definetely is La-la Land. All times are good. In D.C., bad times are good, and good times are — well, good. There is so much money, you could drown in it. I’m afraid that I think all these issues are backed by money, money, money. There really is no stopping it. If you disagree, you might just be out of step. Get back in line, at the back, or start your own line with your own list of complaints. It’s disheartening for daydreamers and idealists, I’ll say that.

  7. January 31, 2012 11:38 am

    To the extent that you are claiming the 2012 Republican contest has failed to produce the contender that most Republicans would like to see as president – you are correct.

    Beyond that – Even Romney does not have sufficient money of his own to run for president.
    Nor have I heard that he has much of his own money in this.

    Romney has better access to contributions from Wall Street, but Wall Street has also already made it clear that they are supporting Obama in the general election.

    If elections are all about money and particularly big contributions – then the democrats will win all the time. Republicans get a substantially larger portion of their funding from small individual political contributions. Nor is this particularly true.

    It is one of the things I have never understood about your rant over money. The vast majority of large political contributions – from unions, corporations, and the uber wealthy go to democrats. Of the largest contributors of the past 40 years, the first to contribute more to Replicators than democrats is the car dealers association – and they are ranked 20th.

    If money bought votes Romney would have locked this up long ago. It has been crystal clear for a long time that the GOP establishment – the party money men, want Romney.

    I strongly suspect Romney will win Florida today. But I doubt this is over. The anyone but Romney vote is huge, and not happy. The fact that they could support Gingrich is telling.
    There is strong muttering out there to draft someone else. I do not see that happening, but it still means that Romney’s words have not made him any more pallet-able.

    I am not sure about early voted. Iowa, New Hampshire, South Carolina and Florida all had to surrender half their electoral votes in return for an early spot on the calendar.
    We have had three contests, so far and three winners.

    In each there was some claim that it would decide the whole contest. Yet here we are waiting for Florida to vote – and assured that if Romney wins it is over, and that if he loses – it is probably over.

    Get over it. It is unlikely this is over, and may not be for some time.

    Obama is a failed president. There is a strong possibility he will get a chance for redemption in a second term – though likely with a strongly republican congress. There is some chance we will actually get to see if he is capable of real Bi-Partisanship – as Clinton actually was. If he is capable of letting go of his inner socialist.

    Obama is slowly looking better – because there is no good alternative. Because gridlock means fewer and fewer ways to screw things up. Because we are ignoring him, and we do not dislike him when we are not thinking about him. Honestly he should pray for a protracted republican contest, because once that ends the attacks will be vicious – and mostly deserved. He is likely to go into the November election with an incredible political war chest. We may well get to test Rick’s thesis of the importance of money in buying votes.

    I personally hope he wins and will likely vote for him – because a republican congress will do far better in opposition to a progressive democratic president. If the GOP wins the white house they will take responsibility for this mess. Gingrich and Romney represent the republican side of the politics that got us into this mess.

    At the same time, my reading of the political tea leaves requires alot of things to go right for Obama between now and the election. Several states he won in 2008 are now solidly republican. There is no state that has shifted democratic. If an election were held tomorrow it would likely be an electoral cliff hanger, Obama would have to win all of a myriad of difficult states – the entire rust belt, plus Florida, and hang onto a myriad of other close democratic states.

    He will benefit as the economy improves – assuming there are no other economic “shocks” between now and the election. There are myriads of possibilities there. The EU is still in deep trouble, and we no very little about China’s actual economic condition.

    I also think you are wrong about this “class warfare” crap.
    The aspiration to succeed on our own without a handout, is an essential aspect of the american character. It is true across ethnicity, and class. Obama has not spoken to that theme at all. His progressive legislative efforts have not actually addressed any of the things people need to succeed on their own – even if they worked exactly as predicted – which they do not, they really would do nothing to provide real opportunities to people at the bottom. One of the fundimental fallacies of progressivism – and why this blog is not moderate, is that the vast majority of us actually recognize that despite now controlling over 40% of the economy, government does not ever create prosperity for anyone.

    We fear big government almost 3 to 1 over business.
    http://www.gallup.com/poll/151490/fear-big-government-near-record-level.aspx
    You and the media have fixated on OWS, Wall Street, CEO’s and the rich. But most of us grasp that the bonuses at Goldman Sachs are meaningless in the context our lives.

    But anything that happens in Washington is a threat.

    The mess that is the current Republican Presidential Primary is that while every candidate is appealing to our anger at big government, the top contenders are all believers in big government.

    • Ian CSE permalink
      January 31, 2012 12:19 pm

      Many many astute observations in your posts Dhlii. But many of them rest on a very shaky assumption, that you know what republican voters want and that they want what you want. In a vague way its true, you want really small government, they generally want smallER government, they would like to remove all the social programs they don’t like, as long as it does not impact them personally. All voters of both parties are selfish and we all want small government, that is we all want government to do only the things we like adn approve of or benefit from and not those evil and senseless things Other people like. Its a childish pipe dream, as Rick Jagger said “You can’t always get what you want.” Society is compromise, its impossible without it.

      Why are all the candidates “Big Government” believers who are selling their small government credentials on the stump? Because “small government”, like “reform,” or “change” or “Washington outsider” are all boilerplate lies that work reliably over and over on different segments of voters. Republican candidates tell the small government lie to voters who think they want to hear it (but who don’t want any part of government they favor or depend on touched).

      Total government is at 45% of GDP and still rising. Its rational to be worried about that, there has to be a limit. I’ve said that over and over but get no credit for it. Oh well. Attacking a problem has to start by understand the its true mechanics. Plans of action based on naive assumptions, well that is red meat for the primary voters of both parties, these are people who dream that if their party can win the whole shebang for four years , they will be able to rewrite society to make it agree with either liberal or conservative principles.

      Reality is that pretty much everything government does in the US today stands on very firm ground in the sense that these programs are built into the system and majorities or huge and influential blocks of voters want them.

      Long ago (it seems like years) You, dhlii asked me to give you a plan to address the fed deficit. I did. I still like my plan in principle. Cut across the board, everything, by 2% per year. Raise revenues (certainly the trickier part) by 2% each year until the two trends balance the budget. Everyone’s ox has to be gored equally, or forget it, it ain’t gonna happen.

      • Ian CSE permalink
        January 31, 2012 12:23 pm

        Upon Rereading my crap I note there is a new person in the world, Rick Jagger. Is that the head of the founder of The New Moderate on Jagger’s body or visa-versa? How many typos did I make here that I won’t notice till I post?

      • January 31, 2012 7:25 pm

        You are correct. Much of what I wrote depends on the quality of my understanding of republicans.

        I am not going to pretend that my grasp of nationwide Republican politics is perfect. Some aspects run contrary to the line of major republican outlets such as NRO or more moderate republican leaning media such as Fox or WSJ.

        If you wish to try and claim that arl Rove has a better understanding of the GOP – though I might disagree he is certainly the acknowledged expert.

        At the same time TNM is abysmal at its analysis of the GOP. Again one of the reason I do not beleive TNM is actually moderate.

        We are all subject to interpret circumstances to confirm our own biases – while I struggle to avoid that I am not immune either.

        TNM and most readers here as well as the media completely misunderstand the significance of the Tea Party (and the insignificance of OWS).

        If you do not grasp the that republicans are far from monolithic – as TNM and the media treat them, then how can you possibly understand conflicts inside the GOP.

        There are myriads of different values represented within the GOP, as well as factions championing different values. This is part of the reason while The Tea Party has overlap with both social conservatives and somewhat more libertarian republicans.

      • January 31, 2012 7:50 pm

        Compromise is an important value – it is not a societal core value. It is perfectly possible (and frequently occurs) to operate society with little or no compromise.

        I am not sure that compromise is a universal moderate value, but I do grasp that it is one at TNM and the propensity to demand compromise and avoid conflict at all costs, does separate me from most here. And I actually suspect that compromise is an important value for those in the political center – though again not the be all and end all that it is here.

        I also do not agree that all of us what smaller government – atleast not in any meaningful way. Our debates have made it perfectly clear that your personal idea of small is at best not to grow faster than the economy. Regardless, when push comes to shove there is very little of consequence you are willing to do to shrink government. While I feel different, and I feel you are wrong. I am most disturbed because you will not face even within your self, what I think are clearly your own values. Saying you value something means that atleast in some instances that value must have atleast minimal effect on your other values.

        To the extent that most americans what small or smaller government – that is only so long is there is no cost to them and to the parts of government that matter to them. Ultimately this is likely to be why we need to get closer to a greek style failure before we are able to fix anything.

        BTW I do not think that Newt and Romney are lying. Fundamentally they are just like you. They want smaller government too – except that when push comes to shove they will opt for more rather than less.

        Absolutely I want the maximum individual freedom consistent with order – or small government. But I have repeatedly offered to settle for the moment for any movement towards smaller. And then TNM starts talking about expanding healthcare or financing trains or regulating business further.

        That is one way in which TNM is clearly not moderate. The political center may not mean small in the way I do, but they really do went to end atleast some things.

        You say that 45% and growing is too large. But you are incredibly vague about what you might consider whittling away at – even a little, and in the end you are more interested in bringing in more money which will only get wasted, rather than really addressing spending.

        Personally I think the GOP proposals this summer were not close to adequate as a start. Not a single one actually reduced government. The best they did was slow the rate of increase – yet you and the rest of TNM were livid – like greeks rioting because their spendthrift ways have brought them to ruin and now they are demanding that everyone else to bail them out. That is where we are headed – not fast, but inexorably.

      • January 31, 2012 8:24 pm

        You really believe that there are substantial majorities in favor all those programs.

        I think it would be trivial to get huge majorities opposed to the vast majority – if each was taken on its own. It is that political compromise you so favor that has gotten us where we are, as well as the public’s demand that government do something – even when there is nothing government can do.

        I think you could trivially get majorities to oppose:

        Each corporate subsidy if encountered alone.
        The extent if not the specifics of nearly every safety net program – according to current rules I think I qualified for food stamps last year.
        I do not think you really understand the extent of government programs.
        In 2011 66% of all school lunches were provided free or reduced price.
        58% were free.

        Do you really thing the majority of us would vote to keep Fannie and Freddie ?

        It is possible a majority might still vote to save USPS but that is likely to change.

        A majority of americans favor repealing APACA.
        I think Ron Paul’s plan to end foriegn aide would easily get a majority.

        There are only three major spending conduits that are difficult to cut.
        Social Security. Medicare, and Defense.
        It is probable that we can get majorities to support minor adjustments to each of these. But even discussing doing anything about medicare and social security enrages vociferous voting minorities that will evicerate most any politician willing to open their mouth.

        Yet, absolutely everyone knows the current circumstances are not sustainable. We may disagree over whether the changes needed are major or minor, but not whether change is needed.

      • January 31, 2012 8:30 pm

        If you are willing to do real cuts, not reductions in the rate of increase you can apparently balance the budget in 6 years solely by cutting spending by 1%/year for the next six years. You can also bring federal spending down to post WWII historical levels of 18.2% of GDP in 10 years.

        Raising taxes is a non-starter because it is just plain stupid. It will kill the economy, net you little or no revenue and not only harm the wealthy that you hate but all the rest of us at the same time.

        Though he is perfectly willing to engage in class warfare rhetoric, Pres. Obama had a full two years durring which he easily could have raised taxes.
        He did not because every sane economist grasps that is the most idiotic thing you can do.
        http://mack.house.gov/index.cfm?p=PressReleases&ContentRecord_id=14d5b552-47e6-44f3-9c00-c038841dd57b

  8. Kent permalink
    January 31, 2012 11:39 am

    Rick,

    1. Big Money. All Presidents were considered “rich” if not “wealthy”. Washington was the wealthiest followed by Jefferson, Hoover and the Kennedy’s to name a few. Romney is lower, but yes, all are “rich” and want to “play” leader.

    A. It will take a grass roots organization to build from the ground up people who want politicians to be a part of the majority middle-class. To do this, they must remain under a certain income threshold. Denounce money as only a necessary to combat the forces of evil and unhappiness. Most of all stress that they are running for political office to make other people live life to their fullest. In other words, run for office not out of “want of money or material wealth”, but out of “need for happiness” for all.

    2. Intelligent people pay attention to what a Candidate says and does and also researches what others say in order to stay smart. This person also engages in “intelligent debate”

    An ignorant one takes small bits and gossip/t.v. ads and votes/gossips accordingly. This person engages in “ignorant/closed debate”.

    A naive person hears one thing or nothing and acts to do nothing or vote.

    3. A person who believes in their views should ‘stick’ to their views even if it is going to be a loss. Being a loser is a sign of strength that you accept your not perfect and that you have a challenge to get your voice heard. That is what this blog is all about….DUH! It isn’t Republican, nor Democrat.

    If a politician doesn’t become the nominee, don’t give up your views. Either vote for the one that best supports most of your views or vote for “NONE OF THE ABOVE”.

    Also, These early votes should only be allowed by population size. Smallest first. Make everyone count. The fact that Iowa starts first is a sign of weakness and fear that their voices aren’t being heard and it is also a sign of attention and self-boasting.

    4. My thoughts on candidates is that the people’s moods or thoughts will control the outcome. If you use your emotions to dictate your intelligence (common sense) then you are in effect creating a worse life for others and yourself. The candidate will be determined by either logic or emotion (mood).

    The fact that the “Fringe” (Bachmann/Perry) is out is a good sign that “religious doctrine” isn’t the driving force in this country this year. Economic problems we have are not so much religious as is the common sense of not spending more than you are bringing in.

    5. Obama is starting to look appealing to me also, Ugh!!

    Gingrich is “grooming” Romney for the struggles ahead with Obama. Whether it works?

    Obama will have a “lame duck” second term if this pans out as a Democrat Executive/Republican Congress. Although, something might get done as Obama might “shift” to more Conservative demands.

    Then again, the Democrats seem to think that they can win 25 seats to reclaim the House.

    We will have to wait and see what comes out of the “Grooming” Gingrich.

    • valdobiade permalink
      January 31, 2012 2:28 pm

      Kent wrote:
      Big Money. All Presidents were considered “rich” if not “wealthy”. Washington was the wealthiest followed by Jefferson, Hoover and the Kennedy’s to name a few. Romney is lower, but yes, all are “rich” and want to “play” leader.
      ========

      I always wonder why the rich are running for presidency. It makes the “anybody can be President of the US” an utter lie for all American citizens.. A rich person does not hate government for he/she is running for Presidency and establishes a new government.

      A small government helps the rich focus on his/her cronies better and disregard the needs of the masses to even eliminating the middle class. A big government is a waste of money but may help a bigger number of the masses to get from paycheck to paycheck and may keep a stronger middle class.

      A President of a small government put more accent on the money and think that the masses are a waste. A President of a bigger government think that’s better to waste money and give a chance to masses to multiply.

      Presidency seems to be actually a business, the rich invest in Presidency to get a profit. In the end “The Invisible Hand” chooses the President. 🙂

      • Kent permalink
        January 31, 2012 3:28 pm

        Yes, the Presidency is to run basically a business.

        “The Invisible hand” I choose President ????

      • January 31, 2012 10:07 pm

        You have most of this upside down.

        Big government serves the interests of the wealthy, big corporations, ….
        Small government provides only basic services and has no resources or power left over to be corrupted. Businesses are forced to profit by competition in the marketplace, not chronyism with government.

        Government money is ultimately less helpful to the poor than the economic growth that does not happen because of government spending.
        Just a 1%/year increase in the growth rate doubles the median income and standard of living in less than a generation – 20-30 years.

        The rich in various forms do invest in government – but what they want is to use the power of government. Reduce government power and you will reduce political corruption and money in politics.

        To some extent it is the “invisible hand ” working.

        Give government power and someone will find a way to co-opt and abuse it.

    • January 31, 2012 9:20 pm

      A substantial portion of our presidents were “self made”. In fact most of the wealthy in american, did not get that way through inherited wealth.

      Washington did receive a little from Martha’s family, but primarily made his wealth in land speculation.

      Jefferson inherited 50 slaves and 5000 acres. While nothing to sneeze at that was not great wealth by Virginia standards. When he died he was nearly bankrupt.

      Hoover’s father was a black smith and farm store owner – not a tycoon. Hoover was orphaned at the age of 9.

      JFK was wealthy, but much of it was made by his father.

      Romney made all his wealth on his own. As did Obama.

    • January 31, 2012 9:22 pm

      I would happy to see “none of the above” on every ballot for every office, with a requirement than the winning candidate must get a majority not a plurality of the vote.

    • January 31, 2012 9:25 pm

      Perry had lots of problems but he was never really a “social conservative” or part of the “religious fringe”. Even Bachman was far more about limited government than about religious issues. Of all the candidates from the begining Santorum is by far the strongest “social conservative”, and he is still in this.

    • January 31, 2012 9:32 pm

      Obama is not in the slightest appealing. If I were to vote for him it is more because Congress an the presidency in the hands of a single party is dangerous – whether it is republican or democratic.

      If Romney is elected the GOP will likely lose its taste for cutting spending and we could be in far more trouble than with a republican congress and Obama as a lame duck.

      He is still an abysmal president. Either Romney or Gingrich (or McCain) would likely have out performed him in 2008.

      If by some fluke it actually looked like democrats would take over congress again I would vote for anyone but Obama.

      Given that I can not get am actually fiscally responsible president, I will choose gridlock.
      Contrary to the meme here, it may be the best we can hope for.

  9. Kent permalink
    January 31, 2012 12:38 pm

    Rick,
    I have always been a proponent that the “wealthy” pay more as they are not required to work per se. The fact that we as Americans are set on this so-called “forced taxation”. Whereby, people must by force pay money to keep the Government running.

    The “wealthy” seem to live on 15% capital tax gains as a “retirement” from having to work. While everyone else who gets a paycheck pays more in taxes.

    Let’s be clear, Americans are forced to pay for something involuntarily. It may be for some good things. It may be for some bad things.

    Does the Government truly represent the people when it forces it’s people to do things? The answer may be only if the people allow it to happen. A Paradox?

    If the Government is “Free”, is it’s citizens? Especially if force is applied to either direction.

    If the citizens control the Government, then is the Government “free”?
    If the Government controls the citizens, then are the citizens “free”?

    We seem to live in this “fantasy” that Government should control its citizens, BUT NOT ME!. Yet, we allow Government to dictate by force an attitude of what you “must” do in order to be a “good citizen”.

    Is a homeless man/woman who pays no taxes a “good citizen”?

    I argue that Government says you are a “good citizen” if you pay taxes. If not, what is the opposite?

    If you are not “forced” to pay taxes then what keeps the Government going?

    Sales Taxes. No one is ‘required” unless you personally accept the “charge” of buying something. It is a free choice and no one…not even Government can dictate who is the “good citizen”.

    How does Government run efficiently? Simple. By having the citizens give Government the ‘Free” authority to make logical decisions on where the majority of Sales tax should be applied.

    Note: I am not talking about a VAT. where everyone is taxed by force and technology is costly to the consumer because it passes thru every business before it reaches the “end user”.

    To further my Sales tax thought, we must accept that all people are “equal’. If this is the case all people have needs and all people must pay taxes for their needs. Not just working people who have to report profits.

    By spreading the “fairness” we all are “equal” and “wealthy”. Unless you bring in your emotions.

    Unfortunately, under this “Progressive” Karl Marx system you will never get fairness until all rich are poor. In other words, Capitalism and Karl Marx is opposite. So you will always have an income gap. The question is by how big a gap?

    If everyone paid a National Sales tax instead of the “Progressive”, the middle class or dare say “working – class” would have more cash and buying things would be left to our decisions. Now that is “Free” and “Pursuing Happiness”.

    I would have more money “on Hand” and I might decide to give some to charity in my local community.

    Instead we have it taken by “force” prior to cashing at the bank. Sent to Washington, Half spent somewhere unknown. Quarter spent somewhere we don’t want it to go and the other quarter spent on my local charity. Which takes tons of paper work and a long time to get back to my local community.

    Under the current system some argue that the “Working – high paid” pay more taxes than the 35% they are now. Do we punish those that succeed? Yet, the “wealthy” non-workers pay only 15%?

    I argue that Obama has it wrong in many aspects. “Fairness” is when each citizens pays for the same thing at the same price. “Fairness” is when all citizens are charged equally. Flat Tax is good, but does nothing to “free” the citizen from Government. Think about this, Does Government give you homage?

    Does a Flat tax which takes the “Working -high paid” from 35% tax rate to 15% work good for them….while you who paid 20% and now going to 15% sound fair? After the change yes, because it goes down, but think about how much more the “working-high-paid) is saving over time by dropping more than 20% per paycheck in taxes. The income gap grows even bigger.

    Wrapping this up. Tax reform is great. Sales tax less paperwork. If you buy things then you are willing to pay taxes to support your country. If you are a “miser”, then you better hope that someone is going to pay the taxes for your protection. Ohh, wait. the “wealthy” have us paying for their protection while they make more money on 15% capital gains and our dead middle-class sons/daughters.

    • January 31, 2012 9:41 pm

      I believe there is an excellent article out there by John Barrow with respect to Capital Gains taxes.

      What most everyone fails to realize – aside from the fact that taxes on capitol are abysmally economically destructive, is that probably 99% of capital gains income has already been taxed as corporate profits.

      One of the proposals out there is to tax capitol gains at the same levels as income, but to allow corporate shareholders to deduct their share of taxes on the stock they own – much as we allow state and local taxes to be deducted from federal taxes.

      Regardless, calculated using both his current income taxes as well as his share of corporate taxes, it is likely that Buffet’s and Romney’s effective tax rates are atleast double their current levels.

      I would also note that Romney’s charitable giving is about 16% of his income – there is not another candidate of wither party that gives 1/4 that much. I am not sure Obama even made 1%. Then again the norm for liberals is about 1%, while the norm for conservatives is about 3.5%

  10. valdobiade permalink
    January 31, 2012 8:13 pm

    Kent wrote: Yes, the Presidency is to run basically a business.

    “The Invisible hand” I choose President ????
    =================

    Well, when you choose (buy) something you are inexorably driven by the Adam Smith misnomer “The Invisible Hand”

    • January 31, 2012 9:59 pm

      Neither government, nor the presidency should be run anything like a business.
      There are vast differences between business and government.

      I want a small, inefficient, incorruptible government.

      When you “buy” something you are driven by your own wants, and needs.

      The “invisible hand” is essentially the changes in the wants and needs of everyone in the market as a response to outside intervention.

      As an example:

      If government provides you with healthcare:
      Your taxes go up so you have less to spend on other things.
      But your expenses go down because you have no need to spend on healthcare.
      The price of healthcare goes up – because the forces keeping it under control are weakened.
      The availability of healthcare declines, because we always overconsume anything we do not have to pay for .
      And on and on.

      Basically the “invisible hand” is the usually unexpected, and predictable, but unpredictable consequences of an outside force (usually government) in the economy.

      The housing boom/bust being the perfect example.
      There are myriads of complexities, but the bottom line is when you alter the price of credit from that the market arrives at on its own, you alter the amount of credit available. If you increase the amount of credit – you inevitably end up with that credit seeking riskier and riskier investments. Again this is not some libertarian economic thesis, it is just basic economics. Supply and demand. More credit means more loans, increasing the volume of loans means increasing the percentage of riskier loans.

      If government had just generically increased credit (the feds keeping interest rates too low too long), that risk might have gone somewhere besides housing – but it still would have gone somewhere and there still would have been a bubble and it still would have burst and the consequences still would have been pretty much what they are now.

      BTW this is essentially the most widely accepted cause of the great depression.
      Too much government sponsored credit for too long which caused a manufacturing boom, which eventually collapsed because demand could not keep up.
      Followed by idiotic government stimulus – under Hoover and FDR, that just made things worse.
      The only difference between the current mess and the great depression is that The depression era FED radically shrank the money supply, probably turning a short but serious recession into a long depression. While the current Fed radically expanded the money supply.

  11. February 1, 2012 9:58 am

    Thus far in this election cycle Pres. Obama has raised more money than all republican candidates combined – approx $80M almost none of which has been spent. At the current rate he will likely exceed $1B in donations by the election.

    The fundamental change in the fund raising landscape since the 90’s is that the “soft money” that used to go through the political parties now goes through “super-PACs”.

    Given the choice I would prefer to see PACs rather than the parties control election funds.
    It makes the money more likely to be used for the purpose it was donated for.

  12. February 1, 2012 10:07 am

    The Tale of a Slave

    Consider the following sequence of cases, which we shall call the Tale of the Slave, and imagine it is about you.

    1). There is a slave completely at the mercy of his brutal master’s whims. He often is cruelly beaten, called out in the middle of the night, and so on.

    2). The master is kindlier and beats the slave only for stated infractions of his rules (not fulfilling the work quota, and so on). He gives the slave some free time.

    3). The master has a group of slaves, and he decides how things are to be allocated among them on nice grounds, taking into account their needs, merit, and so on.

    4).The master allows his slaves four days on their own and requires them to work only three days a week on his land. The rest of the time is their own.

    5). The master allows his slaves to go off and work in the city (or anywhere they wish) for wages. He requires only that they send back to him three-sevenths of their wages. He also retains the power to recall them to the plantation if some emergency threatens his land; and to raise or lower the three-sevenths amount required to be turned over to him. He further retains the right to restrict the slaves from participating in certain dangerous activities that threaten his financial return, for example, mountain climbing, cigarette smoking.

    6). The master allows all of his 10,000 slaves, except you, to vote, and the joint decision is made by all of them. There is open discussion, and so forth, among them, and they have the power to determine to what uses to put whatever percentage of your (and their) earnings they decide to take; what activities legitimately may be forbidden to you, and so on.

    Let us pause in this sequence of cases to take stock. If the master contracts this transfer of power so that he cannot withdraw it, you have a change of master. You now have 10,000 masters instead of just one; rather you have one 10,000-headed master. Perhaps the 10,000 even will be kindlier than the benevolent master in case 2. Still, they are your master. However, still more can be done. A kindly single master (as in case 2) might allow his slave(s) to speak up and try to persuade him to make a certain decision. The 10,000-headed monster can do this also.

    7). Though still not having the vote, you are at liberty (and are given the right) to enter into the discussions of the 10,000, to try to persuade them to adopt various policies and to treat you and themselves in a certain way. They then go off to vote to decide upon policies covering the vast range of their powers.

    8).In appreciation of your useful contributions to discussion, the 10,000 allow you to vote if they are deadlocked; they commit themselves to this procedure. After the discussion you mark your vote on a slip of paper, and they go off and vote. In the eventuality that they divide evenly on some issue, 5,000 for and 5,000 against, they look at your ballot and count it in. This has never yet happened; they have never yet had occasion to open your ballot. (A single master also might commit himself to letting his slave decide any issue concerning him about which he, the master, was absolutely indifferent.)
    9). They throw your vote in with theirs. If they are exactly tied your vote carries the issue. Otherwise it makes no difference to the electoral outcome.

    The question is: which transition from case 1 to case 9 made it no longer the tale of a slave?

    • valdobiade permalink
      February 1, 2012 2:44 pm

      Everything from 1 to 9 is included in definition:

      Slavery is a form of employment used by many absurdly rich people to avoid paying high capital-gains taxes. Also called “career” or “profession”, it involves the concept that other people should do your work for you while you check your stock portfolio, or even better, embark on a cruise to the Cayman Islands, where slavery originated

      The concept of slavery involves doing work for a Master in exchange for food, water, shelter, beatings, and other needs that the slave has. Generally slaves live in very large, comfortable houses and live happy lives.

      The Master is a specific individual who runs the government, is in bed with the leaders of all large corporations, and is behind the scenes when it comes to authority figures in general.

  13. February 1, 2012 10:32 am

    Your Government at work – Fredddie Mac makes market bets against homeowners.

    http://www.propublica.org/article/freddy-mac-mortgage-eisinger-arnold

    Hopefully pro-publica and NPR are not too conservative for you.

  14. Ian CSE permalink
    February 1, 2012 12:11 pm

    An analogy here:

    http://www.youtube.com/watch_popup?v=5hIc2ODfRxQ

    The lady is the voters, the man is, er, lets say the system. You might have to watch a brief MacDonalds ad.

    Sent to us by a friend who was a famous figure skater/circus performer.

  15. Ian CSE permalink
    February 1, 2012 12:46 pm

    Impossible to reply in any sensible place, sigh. If they raise my taxes by 2% that means a my fed income tax bill of say $5000 becomes $5100. I would not even notice it and the well off even less. THATS going to tank the economy!?!

    If giving everyone $300-400 didn’t save the economy, taking an additional 2%, i.e. raising e.g. the 15% rate to 15.3% isn’t going to tank it. The reasons Obama did not raise taxes are different than you give, but we could argue about that hypothetical forever and I have other fish to fry so I will let each choose their own hypothetical reasons.

    Can you show me the figures for how a 1% cut in spending would lead to balanced budget in 6 years? It looks to me like a 2% cut each year for 5 years leads to about $400 billion in savings, but I did it in my head and pulled budget figure from there as well, so I could easily have miscalculated.

    I hold to my opinion in general form, cuts have to be made across the board and have an equal measure of revenue enhancement.

    It seems to me that your issue is that you wish to starve the beast until government withers to next to nothing and are simply against tax increases that would help to cut the deficit because the deficit is not your real target.

    • February 2, 2012 1:05 am

      I would check your math. First if your taxes are only $5000/year and we are talking purely income taxes then your Adjusted Gross income is approximately 40000. (worked backwards from IRS Pub 15) Increasing your tax rate by 2% would be an additional $800 in taxes/year.
      If you are including Fica, and HI taxes in that $5000/year – total taxes not just witholding taxes, then your AGI is even lower – and a 2% increase might be more like $500/year.

      But lets accept your figures as they are if you gave the government $100 more per year, you would spend or invest $100 less. That may seem small but times 140M households that is $14B removed from the economy – but oops 2% of the economic is NOT $14B it is actually more like $300B or about $2200/houshold. Of course most households would get hit with something more on the order of the $800 I noted above – because the greatest percent of taxes and nearly all the cost of running the federal government is paid by people earning more than $40,000/year. You have fallen once again into the forgotten man fallacy.
      90% of us will get together to steal almost $300B from 10% of others.

      Bring federal spending down to the 18% or lower of GDP that it has been for the entire history of this country, and if you are still short, then maybe we can talk about taxes.

      If you are actually talking about increasing total tax revenues by 2% – estimated 2012 total tax revenue is 2.6T a 2% increase would be $52B, this would mean increasing each tax bracket by about 1/3 of a percent – which would probably work out close to your $100/year.

      I posted a link to the 1% spending cut proposal. I have not bothered checking the numbers, but I am pretty sure I gave you figures long ago, demonstrating that cutting spending 1%/year coupled with 3.5% yearly growth in GDP (the average for the 20th century) would rapidly balance the budget.

      The trick is that the 1% cuts to spending must be real cuts not reductions to the rate of increase.

      I do not have the link at the moment, but CBO has put out some pretty damning data recently. showing a robust inverse correlation between government spending and economic growth – not just recently, but over the past century. This is nothing new – the papers I provided before showed every 10% increase in government spending produces a 1% decrease in the rate of growth. But now we have CBO saying it.

      In fact there are lots of useful data at GAO, CBO, the Fed, NBER, …..
      The economy just plain does not work close to the the way progressives wish it did.
      I do nto think there is a historical example anywhere of increased government spending actually stimulating an economy – yet, myriads of politicians and a few economists still cling to this fallacy.

    • February 2, 2012 1:31 am

      Why do you hold to this fallacy regarding tax increases ?

      Almost no one think there is a revenue problem (aside from the declines due to the recession). Tax rates prior to the recession were nearly the lowest they have ever been – yet tax revenues were nearly the highest they had ever been. There is no reason to believe regardless of what the rates are or how you structure the taxes that you can take in more than 20% of GDP and the sustainable max is probably 18.5-18.6. Pretty much what revenues were during the Bush years.

      You do not have to be a supply sider to accept that there is a tax rate above which revenue either stays the same or declines. – The revenue maximizing rate and the actual optimal tax rate – that with the greatest revenue for government with the least economic harm are quite different. The optimal rate is likely at least 1/3 and possibly 2/3 lower than the revenue maximizing rate – and in the long run the optimal rate actually results in more money for government – a smaller piece of a much larger pie.

      You still fail to grasp how incredibly trans formative a 1% increase in the growth rate for GDP would be.

      To give you an idea – I believe the growth rate for the bush era was about was about 3%, now it is just barely above 2%. A 1% difference has monumental effects on unemployment, prosperity, our outlook, even the scale of our debt problems.

      Every current economic problem we have but one would become inconsequential with sustained 3.5% growth. That problem is the shortfall in medicare and social security.

      Maybe you can not accept that everyone including the poor are better off today that they were 30 years ago because of economic growth – not government programs.
      So how far back in history do I have to go before you are prepared to admit that people were worse off than even today ?

  16. February 2, 2012 12:26 am

    Timothy Evans, a D.C. taxicab inspector, . . . notices too many inside a taxi jerking slowly up Fifth Street NW — not the seven or eight passengers he sometimes sees sardine-stuffed into the Crown Victorias and Town Cars that make up the bulk of the city fleet, but still too many. He pops on his car’s flashing lights. The cab stops, and out they come, six of them. While Evans goes to chat with the driver, his partner, Carl Martin, calmly absorbs invective — not from the driver but from the riders, a group of activists from California who are in town for the Occupy Congress protest. Nadine Hayes, 59, of Camarillo, is none too happy her driver ended up with $50 worth of tickets — $25 for overloading, $25 for an improper manifest. “He was doing us a service and taking us to where we wanted to go,” she said. “I think we’ve got far too many laws. I think the American people are being so oppressed.”

  17. Ian CSE permalink
    February 2, 2012 9:16 am

    Dhlii,

    My math may have errors but I specifically said that I did not mean a hike in rate from 15% to 17%, I meant, as I specifically said, a hike of 2% from 15% to 15.3%.

    I really did not say anything about withdrawing 2% of the total economy and calling that my tax increase. If total revenues were 2.7 trillion last year then under my little exercise they would be 2.7 trillion plus 2% of that this year which in my not very awake yet head comes out to 54 billion. Next year it would be 108 billion (i’m not compounding).

    Its a moderate rate of tax increase added to a moderate level of cutting the budget and those two moderate trends would intersect at some point. I’m not considering many complexities, for example I am not projecting growth in the economy. its a very simplified model. Its just a concept.

    • February 2, 2012 10:25 am

      If you cut spending by 2% and increase taxes by 2% while you might reduce the deficit more quickly – presuming that you actually get more revenue from your tax increases – itself a dubious proposition. I would remind you that historically the highest tax rates have yielded the least revenue, You still do nto seem to get what slowly even the states are grasping – higher tax rates never bring in the projected amount of money, and rarely are net positive.

      Several years ago Ireland cut capitol gains taxes from 40% to 20%, the net result was a factor of 3 increases in capitol gains revenue that continued until the economic crisis.

      If you want your “2%” increase just skip extending the payroll tax holiday which costs about $265B/year – you are going to have to do that eventually anyway, ultimately it is just making the social security and medicare problems worse.

      Or eliminate the extension to unemployment which is just an expensive job killer. The longer you keep people out of the work force the harder it is for them to get back in. Two years out of the workforce makes you nearly unemployable. And statistically only a few percent of people even look for a job prior to the last 2 weeks of unemployment.

      2008 Revenue was 2.6T 2011 Revenue is estimated to be 2.6T.
      200 Spending was 2.8T 2011 Spending is estimated to be 3.8T.

      I do not see a revenue problem.

      One of the fallacies of compromise is that it encourages both sides to seek far more extreme positions than what they really seek knowing compromise will result in what they really hoped for. It is compromise on fiscal matters that has lead to ever increasing government and ever increasing deficits.

      The default position is that government should expect little more revenue and generate little more expenses than it did the previous year. The default is that government should not spend more than it takes in.

      The last Clinton budget had 1.789T in expenses – without any real increases in spending and only adjusting for inflation that would be 2.34T in spending today. Conversely Revenue was 2.025T – adjusted for inflation that would be 2.65T today.

      You do not seem to grasp that we have a MAJOR spending problem

      A reasonable compromise is to say we will look at revenue once you get spending back down to the levels of Bush’s last term – his highest spending level’s. And Bush was a spendthrift.

      The left is telling me that conditions for the least of us have not improved in the past decade, or past 30 years, certainly not in the past 3 years.

      In 2000 the National Debt was 5.6T, today it is almost 16T. Essentially government has spent more than an additional 7000/year for every family in the US for the past decade with no improvement in their circumstances.

      For reference that 16T in debt is almost $120K for each family in the country – rich or poor. It is nearly $50K for each man women and child.

  18. Anonymous permalink
    February 2, 2012 10:21 am

    OK, it can be Very confusing to talk in percentages. You may remember that I accepted your paper that said that for every 10% of the economy the Fed government consumes as a percentage of GDP there is a 1% decline in growth, i.e., from 3% annual to 2% annual. And one almost has to use that many words to say specifically what they mean when they talk in percentages. That paper was a very nice professional piece of scholorship, and it also contained many caveats, i.e., examples of countries where that relationship did not hold. But lets say we accept that for the US it holds.

    I promise you that I fully comprehend what a 1% increase in the rate of growth means to the economy. The basic idea of reducing Fed spending to what it was in Clintons time as a percentage of GDP also gets my theoretical approval, and on top of that I understand that entitlements take the situation in the opposite direction and fast, I understand all of that. As well, I long ago made a post in which I admitted that after reading several Economist articles I had to admit that you and Priscilla were correct and I wrong, raising tax rates drastically does not net more revenue beucase it leads to aviodence responses by those who were intended to be the sources of new revenue. The take home message of those articles was that there are ways of raising taxes and revenues that do not lead to avoidance and contrary results.

    This is why I proposed a very slow and gradual rate of increase. As I said, I am not going to notice a 2% increase in my tax bill, if I pay 102% of my 2011 tax bill this year I will not notice or try to avoid it.

    Now my plan is just a hand waving exercise, but I like it.

    I cannot find your link to the 1% six year plan that balances the budget, I’d like to see what assumptions it contains. If you could be so kind….

    • February 2, 2012 11:25 am

      It is not just about tax avoidance. Investment is about deferring current real wants and needs in the hope of greater rewards in the future. A ten percent return is considered excellent, and the historic average return for corporations is 8.3%.

      Lets say you have 100,000 that is money already taxed. It is yours to do with as you please.
      You can keep it, spend it as you please. Or you can invest it.
      If you invest it, you risk losing some or all of it. If you are lucky you will get a return of 10,000/year – but you will owe taxes on that 10,000. If the taxes are 20%, you will only get 8,000/year – now the real return is only 8%, inflation has been low more recently averaging about 2.5% – but inflation applies to your entire investment, not just the years income, so every year you lose 2,500 of the initial 100,000 to inflation. It will take you 13 years rather than 10 before you will have been able to spend 100,000 that you could have spent on day one. During that entire time that money is at risk, and that risk is real – 2% of all fortune 500 companies will fail each year, During most of US history there has been a recession every 4-5 years. There is a small but real probability you will never get your 100,000 back – just as there is slightly larger probability that 13 years into the future you will have collected 100,000 in money you can spend and still have your 100,000 initial investment – which is now only worth 66,000 in inflation adjusted dollars – assuming you have not actually lost it.

      The fundamental problem with taxes on capitol is not that investors avoid taxes. It is that small changes in tax rates radically alter whether an investment is a good decision or not.

      Now lets put this in the context of the rich you are so eager to tax the crap out of.

      Warren Buffet’s total Worth is approximately $50B. Buffet is notably frugal and I would be surprised if he spends even $1M/year on himself, but let us assume he was incredibly spendthrift and spent $1000/minute or 1/2B/year on himself – of course all that spending is purportedly stimulative, so lets say he takes most of it into his back yard and burns it (beleive it or not that can actually be stimulative as it contracts the money supply and counters inflation). The remaining $49.5B is invested. Adam smith noted this two hundred years ago, long before there where people with anything approaching Buffet’s wealth.
      As one’s worth increases beyond what is needed to sustain you and meet your needs for creature comforts, that additional wealth rapidly migrates to investment rather than spending. It is nearly impossible for the uber wealthly to spend even 1% of their wealth on themselves in a year – the rest is invested. This holds true to a lesser extent as wealth decreases, Even the spending of millionaires is dwarfed by their investment.

      What this means is that almost all of Warren Buffet’s money is already actively engaged in making life better for the rest o us, creating jobs, and products we want – and the only thing he can get out off it is more money that he can not possibly ever spend, which just gets re-invested.

      So what can $50B of investment do ? Well the market capitalization of General Mills is $25B or the 155th largest company in the US. So Buffet could own two General Mill’s. General Mill’s employ’s 33,000 people so Buffet’s investment is likely responsible for the direct employment of 66,000 people. And that is just the direct effects.

      If Buffet entirely withdrew his $50B from the market – it would be replaced and General Mills or whatever he has invested in would not vanish – but that money that rushed in to fill the void – that would have come from other investments in other companies.
      If Buffet withdrew his $50B from the market there would be a net direct loss of 66,000 jobs.

      The indirect effects are likely to be even larger. This is also one of the reasons why the charitable efforts of the uber Rich such as Gates and Buffet are not nearly so good and idea as they seem. The Billions they give to charity is tens of thousands of jobs that would have existed otherwise, and more jobs that exist to service those, and the wealth created each year by those in those jobs.

      When I keep talking about the seen vs. the unseen this is what I am talking about.
      The left keeps fixating on the seen.

      They are going to take money from the wealthy and business where they think it is just sitting, in order to do all the wonderful things they plan. Even accepting that all those wonderful benefits of government spending materialize – and we are now talking about deficit reduction, so we are not talking about great new benefits, but just paying for what govenrment has already spent and consumed – no matter how efficient you think government is deficit reduction is all direct cost and no direct benefit. It is the price we must pay for PAST spendthrift behavior. Anyway regardless of the benefits you are ignoring the less obvious cost.

      All that data about government spending resulting in lower economic growth. It is not magical. It is not because the rich are evil and will not do as we wish if we tax them.
      It is because when we take their money – money they can not possibly spend on themselves, there is a loss of investment and the jobs that investment creates, and because no matter how good you think government is at anything it does the net benefits of government spending are less than that of privately investing exactly the same amount of money – to the tune of 1% growth in GDP/year for each 10% of GDP that government consumes.

      That is not a huge difference – but it is very real. It is also robust. Only the Scandinavians have ever managed to do better – and even there the curve is just less pronounced, and despite having huge governments they also have very pro-business governments, low regulatory burdens – a hands off approach to business.

      • valdobiade permalink
        February 2, 2012 3:04 pm

        Lets say you have 100,000 that is money already taxed. It is yours to do with as you please.
        You can keep it, spend it as you please.
        =============

        If I spend 100,000, they are not already taxed, because if I buy a car at 100,000, I have to pay 100,000 PLUS taxes.

        If a rich son of a bitch buys a 100,000 car he won’t pay taxes because he declares the car as “investment”, or buys the car as “business transaction” with another rich son of a bitch.

        Of course the rich will laugh in my face because they can avoid paying taxes. It is not about taxed income, it is also how advantageous if for rich to spend their income AFTER taxes, IF they pay taxes. Most of their income and profits are “invested” so it is not taxed because they “create jobs”… bullshit.

        It seems that rich consider the extension of unemployment benefits as a waste of money, so let’s round up all people without jobs and exterminate them… add also all the people who participate in Occupy Movement, gay and lesbian, non-Christians, atheists, non-patriots, all people under poverty threshold, then you get a beautiful America!

    • February 2, 2012 11:37 am

      I have not looked at this plan thoroughly, I am not specifically trying to sell it.
      I am pretty sure Mack does not even specify the details of what will get cut, leaving that to the president and congress to work out year by year.

      A quick spreadsheet seems to indicate that it is based on two simple assumptions.
      Making real spending cuts of 1%/year down to a budget of 3.5T in 2018,
      And increasing revenue by 4.5%/year as a result of economic growth to 3.5T in 2018.

      But even if you presume that is overly optimistic. With today’s anemic 2.5% growth the budget would still balance by 2021

      http://mack.house.gov/index.cfm?p=PressReleases&ContenFEATURED%20ISSUEHURRICANE%20PREPAREDNESStRecord_id=14d5b552-47e6-44f3-9c00-c038841dd57b

  19. February 2, 2012 11:42 am

    Here is a link to a review of the plan by Lanny Davis (special counsel to bill clinton)

    http://www.huffingtonpost.com/lanny-davis/connie-macks-penny-plan-w_b_917649.html

  20. Ian CSE permalink
    February 2, 2012 6:39 pm

    Very nicely written and I do sincerely appreciate the economic lesson. But it pretty much does boil down to considering supply economics as a proven fact, when it is actually a controversial theory.

    As well, I really do not think that my idea that we would paying 1.02% more each year is being eager to “Tax the hell out of the rich”

    From Wiki:

    In 2006 Sebastian Mallaby of The Washington Post quoted George W. Bush, Dick Cheney, Bill Frist, Chuck Grassley, and Rick Santorum misstating the effect of the Bush Administration’s tax cuts.[53] On January 3, 2007, George W. Bush wrote an article claiming “It is also a fact that our tax cuts have fueled robust economic growth and record revenues.”[54]

    (Now comes the good part, I.R.)

    Andrew Samwick, who was Chief Economist on Bush’s Council of Economic Advisers from 2003-2004 responded to the claim:

    You are smart people. You know that the tax cuts have not fueled record revenues. You know what it takes to establish causality. You know that the first order effect of cutting taxes is to lower tax revenues. We all agree that the ultimate reduction in tax revenues can be less than this first order effect, because lower tax rates encourage greater economic activity and thus expand the tax base. No thoughtful person believes that this possible offset more than compensated for the first effect for these tax cuts. Not a single one.[55]

    • February 2, 2012 8:20 pm

      Here is a graph of Tax revenue from 200-the present.
      The first bush tax cut was in 2001. It was considered a stimulus measure as we appeared to be headed into a recession. Subsequently 9/11 occurred. We avoided a recession – or atleast it was extremely mild.

      There was a brief decline in tax revenues in 2002 By 2003 tax revenues were increasing at much the same rate they had before.
      The major portion of the decreases in taxes for the wealthy were part of the 2003 Tax cut – they were actually part of the 2001 cut but had not taken effect and the 2003 cut accelerated them. There is absolutely no evidence that the 2003 cut had any effect at all on government revenues.

      Next I would note the precipitous decline in tax revenues in 2008 – this is what happens when you have recessions.

      In fact if you graph tax revenue in comparison to periods of growth and recession you will find that pretty much all declines in revenue match periods of economic decline and all periods of increase correspond to economic growth. The correlation between tax revenue and tax rates is very weak at best – among other reasons because the actual effects are highly specific to the exact changes in rates and precisely what type of taxes are increased or decreased.

      Whether or not the statements made by Bush Cheney etc are correct or not depend on whether you really believe the economy was heading into a recession.
      It is pretty much inarguable that tax revenues increased from 2003 forward.

      As the 2001 cuts were primarily the cuts to middle and lower classes – which are the least effective in terms of economic stimulus, and the 2003 cuts were exclusively for upper incomes – I think the actual facts speak pretty much for themselves.

      If you wish to argue that cutting taxes on the poor and middle class does not increase and may even reduce federal revenues, and does not stimulate the economy – I am an army of economists will likely agree with you.

      If you are arguing that cuts in upper margin taxes are not stimulative and decrease tax revenue – then you are arguing in the face of facts.

      Separately there is a difference between the left’s twisted meme that “Supply Siders” believe that all tax cuts pay for them selves, and the reality that I believe just about every single economist accepts – that taxes are not immune to the laws of supply and demand.
      BTW this is not actually “supply Side” economics, it is again just econ 101.

      True supply side economics is “Say’s law” – “Products are paid for by Products”.

      That if we do not produce we can not consume. For reference this is what Keynes rejected – and Keynes is wrong.

      Says law is a part of why consumption based economic stimulus must fail, because you must pay for the consumption with harm to production.

  21. February 2, 2012 10:30 pm

    Somebody said that someone else said is wrong – is not an argument.

    As to the Bush tax cuts, there were many economists who made the same complaint about them as was made about the cuts in Obama’s stimulus – both cut taxes on middle and lower incomes too much and taxes on upper margins too little.

    I personally greatly appreciated both cuts, but the overall economic benefits of middle and lower income tax cuts are very small. They may well be good politics, they may even be desirable for any number of reasons, but they are not good economic policy.

    I have no idea who Andrew Samwick is, and I doubt most of us would place great credibility in Most Bush economists.

    But since you like heads of the council of economic advisors:
    elsa.berkeley.edu/~cromer/RomerDraft307.pdf

    “The resulting estimates indicate that tax increases are highly contractionary. The effects are strongly significant, highly robust, and much larger than those obtained using broader measures of tax changes. The large effect stems in considerable part from a powerful negative effect of tax increases on investment.”

    It also follows that the converse must be true – decreases in taxes on investment have a powerful positive economic effect.

    Finally I did not actually claim (nor do supply siders or any other economists) that all tax cuts are revenue positive.

    I will not even claim that all tax cuts are strongly economically beneficial.
    But all decreases in tax on capital are economically positive.
    All increases in tax on capital are economically damaging.

    • February 3, 2012 10:21 am

      I would add that you can chose to increase taxes on capital for any non-economic reason you wish. But claiming an economic justification for them is false.

      You can also chose to decrease taxes other taxes for non-economic reasons, but the economic benefits of tax reductions for those without the freedom to alter there

      • Ian CSE permalink
        February 3, 2012 10:36 am

        I looked into that claim about taxing capital and I found that economists generally agree on that one. I believe I mentioned it long ago. A point for you.

      • February 3, 2012 12:10 pm

        So when is a tax a tax on capitol, investment, income, or consumption?

        Property taxes are likely the only real tax on capitol.
        But corporate taxes and capitol gains taxes impede investment and erode the capitol available to the economy. If Buffet does not re-invest his billions, even if he invests it more conservatively, the capitol available to the private economy will decline – so taxes on investment have negative effects on capitol.

        There are a few people who truly depend on income from investment for their survival – in those instances capitol gains taxes would really be income taxes, but that is rare. Turned the other way Romney’s (and Buffet’s) tax rate is so low because most of the taxes they pay are capitol gains taxes. But if the capitol gains are re-invested rather than used to buy houses, boats and food, then they are not income. Romney’s and Buffet’s rate of taxation on the money they earn that is used to support their lifestyle – as opposed to any profits they re-invest is far, far higher than the rates their secretaries pay.

        Romney is a poor example here as his real income is low and much of his wealth is in blind trust. But find someone who owns a small business, who is reporting a million dollars of “income”, that is really the retained earnings of his business – and this is the norm for the vast majority of high margin tax payers, and you are taxing investment and capital rather than actual income.
        That is not money that tax payer is using to buy yachts of beach houses. It is what he is using to fund and grow his business. And a business with a million dollars of “income” probably has atleast 50 or more employees.

        The critical point is that for the vast majority of us earning say 100,000/year or less, almost everything we are taxed on is income – it is what we use to sustain our lives. Higher taxes come at the cost of creature comforts, or maybe even a few things we think of as necessities. But as income increases past $100,000/year, the income beyond $100,000 increasingly shifts from consumption to investment. We can argue about the tipping point and the rates, but no one sane thinks that Buffet or even Romney consumes but a tiny fraction of their “income” each year.

        Whether you like it or not, whether they like it or not, they are essentially working for the rest of us. They create wealth for the rest of us each year, for which they get money, which they use to create more wealth for the rest of us.

        And again this is an observation Adam Smith made over 200 years ago.
        The rich can not consume more than a fraction of what they produce.
        Because they can not the benefits of the rest of what they produce is for others.

        The danger – specifically the danger of taxes on investment, is that you could take away 99.9% of Buffet’s money and he would still be set for life. His life style would not change. Even that business owner purportedly making $1M/year is probably only consuming about 20% of that. Tax him more heavily and he can work much less with no effect on his own living standard – but a great effect on that of others.

        The cost of high marginal taxes is entirely paid by the rest of us. Because the people you are taxing do not need that money.

        The next great negative effect you have is that you increase the “barriers to entry” for the middle class moving up.

        My recent income has been all over the place. Last year I apparently could have qualified for food stamps. Apparently this year I may run afoul of the AMT. One thing I have noticed in my own taxes, is that I can have far more spendable income with a very low taxable income if the majority of my income is subject to minimal or no taxes. At the same time as my income rises, particularly between 100,000 and 250,000 per year, what I have available to spend does not change much – and there are some places where increases in income produce decreases in what I have to spend.

        Al of this is entirely a function of deliberate idiocies in our tax code.
        When you discuss wealth redistribution the primary effect, is making it harder and harder to move from the middle class to the upper middle class or from the upper middle class to the upper class.

  22. February 3, 2012 10:59 am

    As you seem fixated on “Supply-Side” economics and are defining it using an inaccurate carciture, I though maybe you would appreciate an economists definition.

    http://www.econlib.org/library/Enc/SupplySideEconomics.html

    First I would note that although some people have claimed and in many cases it has been true that tax reductions have produced increases in tax revenue, that is not a principle of “Supply-Side” or any other form of economics. A Reductio Ad Absurdum on the claim that either higher or lower tax rates always produce more revenue disproves both claims.

    I personally have some problems with some of Prof. Gwartney’s explanations.
    Labor elasticity is only relevant to true income taxes – corporate taxes, capitol gains taxes, and even high upper margin income taxes are not truly income taxes, but taxes on capital and investment and thus are highly elastic.

    Slemrod’s claim that some of the gains in the 80’s were due to structural changes such as a move to S corps is correct -in so far as it goes. But that move was driven by that fact that lower taxes on income drove many businesses from C corps to other forms to avoid double taxation.

    The change in upper margin tax rates, as well as the creation of more corporate forms that include shareholder liability protection but avoid double taxation is responsible for a shift from C corps to S corps and LLC’s and a subsequent decline in corporate tax revenue and an increase in income tax revenue.

    Regardless, I would note that contrary to your mime, the negative economic effects of high margin tax rates are now accepted by the overwhelming majority of economists.

    But differently real “Supply Side” economics, as opposed to the carciture you present, is pretty much accepted as econ 101.

    The laws of supply and demand are rooted in in alterable aspects of human nature. When other factors impede their operation that only delays or changes the way they manifest themselves.

    Like it or not the actual debate in the real world of economics over the effects of taxes is pretty much over outside of a tiny subset of Keynesian’s.

    The current great debate among economists is over monetary issues, and is heading past Friedman and towards Hayek and the Austrian’s. World Political Economists outside the US are contemplating the future of money, and increasingly exploring alternatives to Government run central Banks such as Hayek’s free markets in money or return’s to the Gold Standard.

    Many of the supposed extreme views that only extreme libertarians have held in the past with respect to economics and money are increasingly being seriously considered.

  23. Ian CSE permalink
    February 3, 2012 11:21 am

    Dave, at this point I am resigned to the fact that you and I may very well continue our daily chess game until one of us passes away. If it were chess one of us would win but its economics and politics so…

    Your posts are full of facts and logic, yes, and you make some excellent points. Why don’t I just convert to your point of view? We have argued the most about global (Romney) warming and taxes and wealth distribution. What I observe, and it is fascinating! is how a highly intelligent and very well informed man can have what look to me like very extreme views on the environment and economics.

    The difference between us and the reason why I claim I am a moderate is that while I am better informed and more educated than many people, I have uncertainties about everything, because I see multiple points of view and I have many different principles that I have to weigh against each other. You have little or no uncertainty on the subjects we discuss and one core value, freedom, that you don’t balance against anything. You wish government to shrink, in an ideal world to almost nothing but police work and nearly pure self defense, and I say that you blind yourself to all the facts to argue against your climate or economic beliefs because all your choices of which facts to choose to believe must pass the freedom test first of all. Your castle is made of some very good solid bricks and also quite a few terrible ones, and you cannot see the difference between them. You defend some very noble ideas, but you defend some terrible ones just as vigorously.

    Your statement of the principle of supply side economics was impressive and I see the logic behind it and respect it. I have the opinion, which you do not agree with, that all the different sides can be right to a certain extent; the reason these debates go on and on and will forever probably is that both sides have some truth on their side. Were it otherwise one side would have won. You will claim your side DID win and I say that when Andrew Samwick, who was Chief Economist on Bush’s Council of Economic Advisers from 2003-2004 says this claim is unfounded, as well as my old buddy, Bruce Bartlett, well, there is still a very healthy debate about this subject. These two examples are hardly alone and they pretty much deflate your argument that this is some sort of a liberal or leftwing meme, which is really just a generalized ad hominum attack on my sources that clearly does not stand up.

    So, you give me facts and I give you quotes. I understand your point, my rebuttal is not substantial, its just someones opinion. Yes you give me facts, bravo!, but its a case of lies, damned lies and statistics! By which I don’t mean that you are telling me utter lies, I mean that your statistics have been chosen to support your story, and they mislead. Your facts don’t tell the whole story. As well, my source of an opinion isn’t “someone said” its Andrew Samwick, who was Chief Economist on Bush’s Council of Economic Advisers from 2003-2004, said. I have other things I’d like to do today, so I shortcut the fact-finding process and find well-respected experts that disagree with your certainties.

    If I thought that looking at facts and figures for 10 or 12 hours would clearly establish whether supply side economics is pure truth, then I would do it. But I’ve already gone down that quicksand road, I know that when I look at the facts and figures and statistics it will still be possible to see them proving opposite conclusions about the big picture. In fact, this is the scenario that plays out among winners of the mis-characterized “Noble Prize” in economics, so I am not going to settle it in a few hours myself.

    The economic debate will continue forever because the subject is too complicated for one mind to comprehend and so many people take a shortcut, they assume that their core beliefs provide the answer to sorting out all the fantastic complexity.

    If I limit myself to one little dissertation in the morning I find I still have time to do more enjoyable things, to my surprise Vivaldi’s summer concerto has yielded to me (at half speed) in the last couple of months of diligent practice, not to mention that the guitar solos from Sultans of swing are coming along as well, so, as I am not in any danger of being hired as an economist, but can be hired as a musician, I must bias how I spend my free time!

    • February 4, 2012 2:20 am

      The basis for much of what I argue is uncertainty, not certainty.

      I am not claiming I did or did not win anything.

      But I do not care much when Bartlet or Samwick says something is so. I would be more impressed by a credible argument with facts.

      The chart I provided from Wikipedia does not prove anything – but it actually does disprove some things. The timeline of revenue vs. events does not support Samwick’s claim.

      If you think a claim I am making is wrong – make an argument. Just saying you feel differently has as much significance as Samwick or Bartlet – none.

      Christine Romer has said alot of things in the same role as Samwick – much of which flies in the face of her own academic research. Should be beleive here rhetoric or her research ?

      Yes, I do deliberately seek out left leaning sources to bolster my arguments – because I hope you are more likely to take seriously research by CBO, GAO, NBER, or Romer, rather than CEI, Heritage, or Cato – even when they say the same things.

      But I do not recall quoting Krugman to you – though I am virtually certain that I can find a Krugman quote to support anything, because ultimately it is not who said something, but what they said and how strong the evidence is that they provide to support it.

      If you have not gathered appeals to authority have little influence on me.

      You have also blurred many many things together.

      While Supply side is pretty much the opposite of Keynesian economics, there are many things that almost all economist agree on. The idiocy of taxes on capitol are one of those.

      Many economists seem unable to adhere to their own economic principles when given political power, or a bully pulpit.

      What “Supply side” economics is and what the left caricatures it as are not the same thing.

      Though I suspect alot of my economic views overlap with those of “Supply Side” economists, The basis for my views is the classical liberal tradition. Supply Siders are one modern branch of that. But my primary influences are not so called supply siders.

      Essentially you are labeling all of non-keynsian economics supply side and then claiming because supply siders have purportedly been discredited because purportedly the Bush tax cuts were revenue negative, that you have disproven everything but Keynesian economics.

      Most of the arguments I have made would find agreement from supply siders, but also from Austrians, monatarists, most neo-keynesians, public choice, …… myriads of schools of economics.

      Trying to decipher hard and fast rules of economics from real world data is extremely difficult – the world is incredibly complex. The austrians as an example beleive that complexity precludes direct analysis and instead prefer to draw conclusions from principles of human behavior. Though I believe the Austrian approach is the best way to discern principles, and I fully agree with them that the complexites and uncertainties guarantee than no man, no computer, no institution will ever fully grasp enough to exogenously manage the market. At the same time I do beleive we are capable of learning from real world data, and of proving or atleast bolstering our confidence in principles.

      I do not beleive Keynesian economics will survive the analysis of the current economic crisis and the government response to its aftermath. I think the concept of government stimulus – something even Keynes eventually decided was ineffective, will mostly be discredited. I do nto beleive there is a single example anywhere of effective government spending stimulating an economy – across the past almost 100 years, and across all the governments of the world. That is a pretty abysmal record.

      There is a growing body of evidence – including specifically from this particular crisis, that spending stimulus actually makes things worse rather than better.

      At the same time I am not sure how much that will effect governments or politics.
      Politicians regardless of their affiliation are adept at either finding economists to tell them to do what they wish to do anyway, or corrupting good economists into giving them bad advice. Speaking truth to power is difficult.

      I would also note that if you listen to the language of public economists – you find ultimately what they say conflicts. The concept of an “economic shock” is keynesian. Keynes had no explation for the appearance of economic crisises. Shocks are unpredicted and umpredictable, they are sudden reversals in the confidence of market participants without underlying cause. If there is a cause, then Keynesianism is irrelevant.

      Then economists – particularly the Fed speak of bubbles. Of controlling and deflating them before they burst. Not only is this language anti-keynesian, it is fundimentally Austrian. If you beleive that some form of economic bubble causes economic downturns, you have accepted the basic tenants of austrian economics. Like it or not, your in the world of Bachman and Paul. Even if you do not accept that the housing bubble was caused by a credit bubble, if you accept the housing bubble is at the root of this – you have rejected Keynes. If you can not go that far, but are wont to blame evil greedy bankers and mortgage companies along with wall street incompetence – you have still rejected Keynes.

      So think about all the economist you have heard, and how often you have heard about the housing bubble. Whether those economists where keynesians, neo-keynesians, or what, they have atleast unconsciously accepted the austrian theory of the business cycle.

      So yes, I do beleive that as we move forward we will no more. We will never know everything, but some debates will be settled. Including some economic ones.

      AGW would be another example of uncertainty resolving itself. Though I think the evidence against any significant human caused warming is compelling, there is sufficient uncertainty for differencing views – though I think anyone who is being honest needs to abandon the Hanson/IPCC end of the world views, whatever you beleive about the last decade we have fallen out the bottom of Hanson’s best case scenario.
      Regardless, with every year that goes by we know more and more.
      It may not be possible to establish with certainty who is write next year. But in all likelyhood the matter will resolve itself soon. And if not in less than a decade we will be certain. For me the worst case scenario is the earth does not warm much, but politicians manage to impose enough idiotic policy on us to claim responsibility for fixing things.

      Uncertainty is real. We will never know everything, Nor will we ever know enough to exogenously manage the market. At the same time we know more and more each day.
      The existence of uncertainty does not mean we will never know.

      All that those papers and data on taxes on capital and the state of the economy.
      It is not economic fact. Right now it is just correlation, with very high levels of confidence.
      The fact that we are not yet certain enough to prove causation, still means it is idiocy to assume the correlation is pure chance. Further as we have economic principles that explain that correlation, the reasonable conclusion is the correlations are not random and confirm the principles.

      And this is only one piece of the jigsaw puzzle. But exactly like a jigsaw puzzle – if all the pieces fit without being forced, and the result makes sense the odds heavily favor that you put things together correctly.

      • Ian CSE permalink
        February 4, 2012 11:15 am

        Well, Dave, since you do not pay any attention to authorities, why do you expect me to?

        Even comically corrupted ones, I’m thinking of a funny example from our past, Sen Inouyes list of skeptics that contains a great number of people who are not skeptics, some of whom have threatened to sue him if he does not remove him, but he left them on his list anyhow. Utter intellectual dishonesty. If you submit to me authorities in the form of utter shit like that, but you simply make ad hominum attacks on my authorities who are actual respected economists who worked for conservative administrations, well you may not recognize it, but you lost this point. Regarding whether this case is closed or not I have the word of an online Libertarian fanatic against the word of a Dartmouth Professor who was the Head of Bush’s Council of Economic advisors. Simply making a pathetic ad hominum attack, No one would take Bush’s economic people seriously, I mean seriously do you not see how pathetic that is?

        You do not listen to authorities unless they say what you want to hear, then you will accept almost anything it seems! I have actually provided some perfectly reasonable and respectable sources over these many months and you have a defense system that does not let them through your closed mind.

        You are not paying attention to my point. I do not have 10,000 hours to put into collecting data, especially when I know I would not reach a definitive answer if I did. So I simply have the time to check your assertions on the state of the controversy, which I do have time for, and I find that more often than not your assertions are a complete misrepresentation of the field. I doubt its deliberate, you really believe these things are true because you will not let data that says otherwise through your defenses.

        And this is how it is with you, one has to sort out true gems of wisdom that you put a great deal of effort into from absolute cow manure. The gems make it intriguing, having to cover myself in cow manure than you should know better than is quite irritating.

        Can you please, please, please try to see through your own crap, your intellectual bad habits, and provide a better gem/manure ratio? Please?

      • February 4, 2012 12:29 pm

        And on economic matters I have provided you with far more than my own views. I have already matched every republican economist that you have offered with a democrat counter. Further you have offered their remarks, I have offered their research papers.

        Further you pushing the straw man that all tax decreases produce increased tax revenue – and that I am a “supply sider”.

        I am sure you can find some example of some idiot somewhere that claims all tax decrease produce more revenue. But that argument trivially fails through reductio ad absurdum (as does the converse argument that all tax increases produce more revenue).

        I think real world fact carefully examined – not my arguments, clearly refute Mr. Samwick’s remarks. At the same time even if Mr. Samwick were correct, there would be no actual contradiction with anything I (or the vast majority of economists) beleive with respect to taxes on investment.

        Optimal taxation balancing the needs of government against those of the economy, and Optimal taxation maximizing government revenue are two different points on the curve. But my fundamental claim – one that is pretty much obvious by the fact that 0% tax yields 0 revenue, 100% taxation yeilds 0 revenue, and rates in between produce revenue, is that tax revenues vs. tax rates follows a curve. Whether any given change in tax rates increases or decreases revenue depends on precisely where you are on that curve.

        We can argue about the exact shape of the curve or where the inflection points are. But any claim that tax revenue increases linearly forever with tax rates is a trivially disprovable logical fallacy.

  24. Pat Riot permalink
    February 3, 2012 9:26 pm

    Ian, very well said.

  25. Pat Riot permalink
    February 3, 2012 9:36 pm

    Dave can be like a grinding stone in that he sharpens us, but we must pause and rest in grinding against the stone or the friction can heat us up and warp us. 🙂

    The Republican debates don’t include enough blacksmith analogies, so I thought I’d put that out there.

  26. Pat Riot permalink
    February 3, 2012 9:37 pm

    Happy Friday to everyone!

  27. February 4, 2012 1:49 pm

    You keep making a point that you are moderate because you are able to see other points of view.

    Seeing other points of view is not the same as accepting them as correct. Understanding that other people hold different views does not mean you must always compromise yours.

    Conversely rejecting another point of view is not the same as not being able to see or understand other points of view.

    You are correct that I have rejected views different from my own – that does not mean I do not understand them or sympathise with them. Nor does it mean I am ignorant of them.
    My own personal ideological and political history has run the gamut of beliefs. I have read Tolstoy, Kant, Jung, Hegel, Nietzsche, Marx, Hayek, Rawls, Gandhi, Plato, The bible, Dante, Milton, Smith, Mills, Goethe, Swift, Dostoyevsky, Orwell, Huxley, Rand, Homer, Paine, Carson, Schumaker, Witgenstein, Churchill, Moyers, Morgan, Dworkin……..

    I have been immersed in fundamentalism, evangelicalism, liberalism, feminism, pacifism, Buddhism, ….

    And I am old enough that my views have changed slowly.

    You claim to see multiple points of view – yet you have a cartoon view of the right and do not grasp the array of different views that make it up. I know that I do not understand all the nuanced differences between fiscal conservatives, neo-cons, Goldwater conservatives, federalists, tea party conservatives, and Paul supporters – just to name a few, but you see them all the same, and lump libertarians in with them as if anything to the right of our current president is “ultra conservative”

    The fact that I see progressivism and liberalism as failed, does not mean I am ignorant of them, do not understand them, do not sympathise with them, do not see their point of view.

    Even the fact that I have defended myriads of different groups and people against your one dimensional and shallow attacks does not mean I agree with those I have defended.

    I have defended the right of the KKK to march in my town – and I have been on the street to protest as they did.

    I would suggest that your views are more rigid than mine, more held hostage by your peers. Your constant appeals to authority, suggest you are very uncomfortable stepping beyond the protection of the views of your circle.
    Pick a subject – any subject, it does not have to be something we have disagreed with here. Define your views and then seek out and read the best works by those who disagree – and actually read them, not other peoples criticisms of them, but develop your own thoughts. Go to the places people with views different from yours congregate.
    Go to a fundamentalist church or a chamber of commerce meeting. Listen to landlords, and tenants, and real people in different classes than your own.

    Understanding other peoples points of view does not mean framing a cartoon and then attacking it.

    In comparison to alot of conservatives, Bonner, and Ryan, are moderate. The views of much of this nation possibly a majority are mostly to the right of mine – yet you have labelled me an ultra-conservative. That just means you have no idea what conservatives really are, and little idea what most in this country beleive.

    I am not seeking to attack you. I know nothing about you beyond what you write here. And though I disagree on much, I like you, you are a bit more open minded than most liberals. Should I say “moderate” as liberals go.
    I am rigid in the sense that I have looked at the facts and formed my views based on the best information available to me, and I am not going to change those views absent real information effectively challenging them. But I am constantly seeking more knowledge and information. I do not and can not know everything, but nothing I know disrupts my values. I would also note, my core values – with respect to society are minimalist. My moral and ethical views are much broader. I do not expect you or others to conform to my morality, I expect you to offer me the same respect. Achieving that requires agreement on a set of values for society that justify its existence without hindering each of our different views of morality more than is absolutely necessary.
    The libertarian Non-Agression Principle, provides a structure to society that works, conforms to the purpose of society, conforms to history and nature, and interferes the least with each of us having our own set of morals and ethics.

    My views do not require you to conform to my values or morals to live in society – but yours require me to conform to yours. All I ask of you is to accept that each of us is different and our rights to force our morality and ethics on others is limited to only that which is essential to society.

  28. Ian CSE permalink
    February 4, 2012 1:52 pm

    I have not made almost any of the remarks you think I have. Really! You wish to have a certain conversation with some simple minded denier of all you say, but its not me.

    I did a find search for supply side. Almost the only statement I have made about supply side economics is the following:

    “Me: Your statement of the principle of supply side economics was impressive and I see the logic behind it and respect it….”

    From this innocent comment you have created an entire dialogue in which you believe that I have slammed and mis-characterized supply side economics when all I said later is that it is not the only game in town and that it is a theory and not a proven fact and should not be taken as such.

    What I understand about tax policy is that if a generic mainstream economist wished to propose a way to increase tax revenues they would understand that its not a direct simple matter of raising or lowering rates, its an art and one cannot know in advance how exactly much new revenue would occur or be lost from any proposal.

    Tax rates from what I have been able to understand do not like to be changed from whatever exists at present from a revenue perspective. Cut them, you may lose revenue, raise them, you may lose revenue. If you wish to raise revenue there is no simple path that is accepted by all economic factions. Its an black art, raising revenue. I make NO simple assumptions, none.

    You have put a lot of words in my mouth, again. Please do NOT explain why or how, its OK.

    • Anonymous permalink
      February 4, 2012 3:06 pm

      Fine, taxation is a black art. The revenue and economic effects are non-linear and difficult to predict, so why are you in this great rush to increase anyone’s taxes ?

      Thinking about it further I made a tactical mistake with respect to my exegesis on Supply Side. Supply side is actually irrelevant in this discussion – except that it is the most accepted alternative to the position I should have attacked.

      Government revenue from taxation is not linear, and all taxation has economic consequences. To the extent we need some government taxation is a necessary evil.
      It is even arguable that at very low levels the benefits from the rule of law substantially outweigh the costs.

      Whatever the explanation, and even if we have not perfectly quantified the exact effects of every possible tax change, the negative effects of taxes increases are sufficiently well understood that the likelihood of the possible benefits of your 2% tax increase – however you are formulating it outweighing the costs are very small. At the very best you will get less than the $54B in revenue you project, and you will reduce the economy by something less than $108B depending on exactly how you structure your tax increase.

      Accepting that taxation is a black art what is the argument for doing something that has a low probability of producing the benefit you hope for and a high probability of causing more harm than good ?

      I will also suggest that you have another political problem with tax increases.
      There have been numerous agreements over the course of my lifetime to increase taxes and cut spending. I do not believe any have been successful. All tax increases created new spending and spending cuts never materialized. This is the results that “fiscal conservatives” have gotten from compromise in the past. There have been a few instances of real successful spending cuts – as during the Clinton administration. These have been independent. We need to eliminate the recent more than 5%(of GDP) increase in spending just to get to where we can confront the problem with Social Security and Medicare. Whatever scheme you concoct – 1% or 2%/year, eventually tough choices are going to have to be made. I do not think the republicans are capable of making the necessary cuts. I most certainly do not think Democrats can. I think you are capable of agreeing to a one or 2%/year plan of cuts. But I do not think you will remain on board, when it becomes clear that means eliminating or severely reducing funding for the NEA, NEH, NPR, Green Subsidies – possibly all subsidies, Fannie Mae, Freddie Mac, the postal service, Amtrack, food stamps, social security disability…..

      Federal spending has increased by 5% of GDP in 3 years – that is an increase of 20%.

      There are going to be myriads of interests, and commercials pushing grandma off the cliff. Yet all we are talking about is getting back to 2008 numbers.

      I was here while TNM railed at the unwillingness of republicans to compromise over increasing the debt limit this summer. Yet the GOP was only asking for small reductions in the rate of increase, not real cuts.

  29. February 6, 2012 2:36 pm

    Rick;

    Above you offered that Paul’s participation in the debates was atleast refreshing, and some of his views intriguing – if not carried to the extremes he proposes.

    How about real discussion of some of those issues.

    Outside of Paul the real differences between democrats and republicans on immigration are inconsequential. Democrats can not take a strong stance against illegal immigration without alienating the substantial minority populations they depend on. They can not take a pro-immigration stance without offending unions. Many republicans tend towards Xenophobia, yet some groups of hispanics are relatively conservative and natural republicans.

    How do we deal rationally with immigration ? So long as our nation is prosperous and free it is going to be an appealing magnet for the rest of the world. We should be proud of the fact that so many people from across the world are willing to leave whatever they have to come here.

    We can punish those businesses that hire illegal – but all that does is kill those businesses or drive them out of the country.

    One of the problems libertarians have with the entire social safety net, and things like minimum wages is that they can not be sustained alongside open immigration.

    I would be happy to see our mean standard of living decline – if the true cause of that decline was the addition of millions of immigrants at the bottom. And in fact our current debates regarding income inequality and the plight of the poor universally ignore the addition of millions of immigrants mostly at the bottom over the past 30 years.

    The war on Drugs has been an abysmal failure, few but lunatics imagine any possibility of actually winning it. While it is doubtful that liberalising our drug laws will “solve” all our problems with drugs and addiction, it is unlikely that they would get much worse. At the same time the war on drugs has eviscerated our constitutional rights, and breathed new life into the organised crime that prohibition created. Further we export our problems to the rest of the world. There is no doubt that powerful and violent drug lords pose a gargantuan threat to myriads of developing countries. Corrupting them and eating them like cancer. Even internally just as were learn the value of narcotics in managing the pain of terminal patients or those suffering chronic pain, we are jailing the very doctors and nurses seeking to alleviate real suffering. In the few instances that the states and the federal government are at odds, we have some engaged in activity that the people of their state have determined to be acceptable, subject to prosecution and jail by federal authorities. And again we get contorted court decisions to justify this mess.

    In foriegn policy, what are the criteria for using military force ?
    Most of us supported Bush’s invasion of Iraq – until most of us opposed it.
    We had even less justification for intervening in Libya – though most everyone is happy to see Ghadafi gone. Now we are facing the possibility fo a nuclear Iran.
    As Iraq has made abundantly clear, there is no government on the planet that we can not bring down militarily (most quite easily) if we so chose. At the same time, we clearly have no clear how to deal with the aftermath.

    It seems that most ever debate here devolves to economics. I may personally be guilty of some of the impetus for that. But freedom is not just about economics. The free market is just the economic manifestation of individual liberty. Economics can not tell us what is right or wrong. It can only inform us of the economic consequences of our decisions.
    I have attacked many of what I would call essentially liberal proposals here – because their proponents claimed economic benefits – those benefits are demonstrably false.
    While I beleive the economic merits of libertarian solutions are nearly incontrovertable, economics is not my primary value. It can be rational to make poorer economic choices in order to advance other values. I can not conceive of a world where individual liberty would not result in the best overal prosperity – there are compelling interrelationships – that one could not exist without the other, but even if the economics were reversed, I would advocate individual freedom as a societal value even at small economic cost.
    As a bone to the quasi socialists here, the economic disparity between bottom up and top down is fairly small – between 1% and 10% per year depending on the magnitude of the state. If liberal policies actually met their other objectives, it would be arguable that the benefits outweighed the cost.

    Contrary to the assertions of some here – I can not PROVE the absolute superioty of free markets – atleast not by the standards we are supposed to use in science. I can not win the economic argument. At the same time in the real world the correlations are strong and pervasive. It is entirely possible that some progressive economic policy will work – this time, despite the fact that none have worked before. Regardless the economic differences between more and less freedom do typically take decades to be conclusive.

    Since Ron Paul has caught your interest, since you beleive some of his ideas have merit – even if only in a less extreme form. What would these be ?

    • Anonymous permalink
      February 6, 2012 3:07 pm

      “As Iraq has made abundantly clear, there is no government on the planet that we can not bring down militarily (most quite easily) if we so chose. At the same time, we clearly have no clear how to deal with the aftermath.”

      In a nutshell, we are the most powerful stupids on the planet… since WWII

    • Anonymous permalink
      February 6, 2012 7:32 pm

      Dave: I was referring to Ron Paul’s contrarian views on foreign policy. Of course I’m more of a moderate than he is, so I don’t advocate anything as extreme as total isolationism. But I do support his contention that we’re spending way too much taxpayer money on foreign entanglements — money that could be used to pay down the federal deficit or (heh-heh) create federal job programs like the CCC and WPA. (Actually, the moment for federal job programs has probably passed; Obama should have introduced them as soon as he took office.) Aside from the money we spend on our foreign misadventures, we have to think about the lives we waste on unwinnable wars — not only our boys’ lives, but the lives of innocent foreign civilians who end up as “collateral damage.”

      Though I disagree with Ron Paul on most domestic issues, I like his straight-shooting, no-BS style and his willingness to say unpopular things even if they cost him potential votes.

      • February 6, 2012 10:50 pm

        I find it amazing that a few neo-cons call Paul an isolationist and everyone decides he is.

        I do not wish to proclaim my self the authority on Paul’s foreign policy, but everything I have heard of it is just the application of libertarian principles of interactions between individuals to governments.

        Put differently we have no right to interfere in the actions of another nation until they actually harm us or their neighbours.

        If I recall that is the basis for Woodrow Wilson’s 14 points. I do not beleive he was an isolationist.

        Paul wants a declaration of war before commiting troops.

        Prior to invading Iraq I would be extremely hard pressed to come up with an instance where the US had used military force without atleast the pretense that the otherside used force first. In most instances we have required that the other side used for against us or our citizens.

        If I recall correctly Paul voted to go to war With Iraq in 1991.
        I beleive he voted to go into Afghanistan, and voted against going into Iraq in 2003.

        That is not isolationism.

        In what way do you or the majority of americans today differ from that ?

        Why is a position that I suspect most TNM’rs hold isolationist and extreme because some neocon’s are being repeated by the press ?

      • February 6, 2012 10:55 pm

        Jobs programs do not work. The WPA did nto work – yes it did put people to work, but it was horribly innefficient, and unsustainable, Beyond that you could not get people to take those kinds of jobs today – I suspect if I proposed something exactly like the WPA – yanking people from their families transporting them into the wilderness miles from anywhere, making them live in tents and cabins. Feeding them crap and paying them subsistence wages do do backbreaking manual labor, most on TNM would accuse me of trying to bring back slavery.

        But I was actually trying to drive the discussion away from economics as we seem to always gravitate there.

      • February 6, 2012 11:00 pm

        I think I have mentioned this before – but I would recommend reading “The Ugly American”. It predates Paul, once upon a time it was considered “liberal” to think that maybe
        “do you really think the only way
        to bring about the peace
        is to sacrifice your children
        and kill all your enemies”
        wasn’t the right way to go.

  30. February 6, 2012 7:36 pm

    Whoops… That last comment was mine. Apparently I wasn’t logged in. (It used to be automatic; now I wonder if we have to log in for each comment. We’ll find out soon enough.)

  31. Pat Riot permalink
    February 6, 2012 10:03 pm

    Ron Paul only seems “isolationist” in comparison to the others and the “status quo,” so to speak. He wants trade and dialogue with all manner of countries, so that’s not isolationist. Also, when he says “close the military bases around the world” and “bring the troops home,” that sounds isolationist, but he doesn’t mean ALL of them and he doesn’t mean all at once. He realizes there are some strategic locations, but he also knows that we are in many countries for:
    a) old arrangements/treaties that are no longer applicable (especially since we’re “broke”)
    b) for new deals mostly benefitting select Americans

    A daughter asked her mother why she always cuts the ends off of a roast before she puts it in the oven. “I don’t know, but MY mother always did,” said the mother.” I’ll have to ask your grandmother why she always did that. “Because,” said the grandmother, “I only had one small pot and the roasts never fit…”

    Sheesh, the things we keep doing, over and over and over…God help us.

    • February 6, 2012 11:31 pm

      US Foreign aide does little to improve conditions in the countries we aide. It primarily turns into payoffs to those in power. Nor is this new – it has been that way for generations.
      If US citizens want to give to Sinn Fein, the PLO, Israel or if they wish to engage in charity privately – more power to them. I beleive the US ranks poorly on foreign aide (though we do not count our military assistance) but first amount the world in private charity.

      Almost no one in this country would not immediately come to the aide of Israel were it attacked again. It is likely we would side with almost any nation against an agressor.

      I do not beleive in corporatism in the US, I certainly do not beleive we should export it.
      Once upon a time – while he doing the work that earned him his Nobel, even Paul Krugman recognised the benefits of truly free trade.

      If a US business goes into a foreign country and gets screwed that is its problem.
      If a nation is sufficiently stupid to erect barriers to trade – which are guaranteed losers, that is their problem. We need to hold other nations accountable for their treatment of our citizens when abroad for whatever reason – but we must also expect our citizens to obey the laws of other nations – even the idiotic stupid racist, sexist, discriminatory ones.

      Even if we had the money to give – our government should not be giving money to foreign nations. “Millions for defense, but not one cent for tribute.” it honestly does nto matter if we are trying to bribe or being solicited.

      Every penny government spends comes one way or another from the sweat of its people.
      Whether spent well or ill, it was not contributed voluntarily. While we all have an obligation to support government, government is obliged to remember the money it spends was not given freely.

      • Gadfly permalink
        February 7, 2012 3:17 pm

        “Every penny government spends comes one way or another from the sweat of its people.”

        Yea, from sweat of American Proletariat!

        ” While we all have an obligation to support government, government is obliged to remember the money it spends was not given freely.”

        Yea, it was not given freely, it was abusively taken from rich through the pogrom: “Make the rich poor!”

  32. February 7, 2012 11:52 am

    http://online.wsj.com/article/SB10001424052970204369404577206980068367936.html?mod=WSJ_Opinion_LEADTop

    As TNM is fixated on fairness as the ultimate standard, maybe it would be worth looking at someone else’s idea of fairness.

    You do not have to agree with Stephen Moore to grasp that we do not share anything close to a common conception of what is fair. Morality is inherently subjective. There are not objective standards for our values.

    But there are objective standards regarding what is necessary for society to function.

    Libertarians do not try to tell you what your morals must be, only that you can not force them on others. The powers of government should be limited to those things that are objectively necessary for government to serve its purpose – protecting each of us from the violence of others.

  33. February 8, 2012 1:06 pm

    And again the Tea Party and social conservatives have asserted themselves.

    Most Republicans are seeking a clear alternative to Pres. Obama and regardless of how hard he tries to persuade them that he is truly a fiscal conservative, they are not persuaded.

    Rick keeps ranting about the tremendous power of money in politics, yet between Santorum, Paul and Gingrich they have less total money than Romney, yet Romney is hard pressed to get more than 40% of GOP votes some of the time. In minisota he came in 10 points behind Ron Paul, and almost 30 points behind Santorum.

    Maybe money is not so important after all. Maybe you can not buy votes. Maybe you actually have to be the person voters want.

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