Asymmetrical Information

Maybe.

But between tax and spend and borrow and spend the former is better. It's not only more fiscally sane but it also makes the costs of government more clear to taxpayers.

Maybe expecting a balanced budget is too much but do we need to make things worse, as the GOP has done?

Yet another reason for divided government?

To be filed under, "Yeah, we're in charge, but we're not to blame...." I love the smell GOP accountability in the morning, it smells like...well, nothing.

Don't get hysterical about the budget deficit. Why not? Go here.

Yes, GT, but the decision between reducing those by reducing spending or taxes is neutral, yet liberals clearly prefer raising taxes, while conservatives clearly prefer lowering spending, and when push comes to shove, and they find their preferred solution politically impossible, they prefer deficits to giving up their tax cuts or spending increases.

Tim, I realise that you believe that anything that I say that doesn't damn the Bush administration as the origial source of all evil in the world is an implicit apologia for its policies, but I'm afraid I cannot satisfy your taste for Republican-hatred. I've offered an actual proof of my claims--that Democrats who cared about the budget deficit abruptly stopped caring about it when they realised that they could have a health care plan if they forgot about closing the deficit. How about responding to the point, rather than attacking my motives? "You're a filthy Bush-lover" is not exactly a substantive criticism.

Jane,

I hate that argument when either side gives it. "Party A isn't really mad at what party B is doing because, were party A in power they would stop doing what party B is doing as much, but they would still continue to do it, or they would do it in a different way, or they would do it as a way to facilitate something else." It's specious.

I would also like to point out it is also a specious arguement to say, "Party A must like policy B even though they say they don't because Party A nominated someone for high political office who made ineffective promises about getting rid of policy B which we know wouldn't work." (the following to be read sarcasticly): As we all know, Politicians are honest as the day is long and we can always count on their political promises to be amazingly truthful and exactly what they would do were they to get in office. I remind you of the phrase "compassionate conservative".

Really Jane, what was the point of this post? I'm not saying I disagree but hunh? You're better than this.

You don't then see the PAYGO rules as being effective? Why not?

The Republican's reversal on their long-traditional anti-spending stand is why I stopped being an independent and registered Democrat. Cutting spending was the major reason for voting for Republicans, in my book.

In looking for ways to rein in spending, it's looking like "starve the beast" doesn't work. Why not give PAYGO another try.

Kerry suffered from a poor political message and framing. He said he wanted to roll back the cuts and spend them on health care, yes. He also said that he wanted to reinstate PAYGO rules and would live by them himself.

Here's the thing. To me, that's integrity. But to other folks, it's "having it both ways". Kerry had very strong Rohrshach element to him, I guess. It's kind of like how you can talk to someone about a movie and they, having seen the EXACT same thing as you, come away with an entirely different perspective of it, often it seems to turn on some seemingly minor detail of plot or setting.

Sigh. the point was not to take cheap shots at Democrats, or Republicans for that matter. The point was that people who think that they care about the budget deficit also endorsed Kerry's combination of taxation and spending--including, IIRC, Tim!--and therefore, don't really care very much about the deficit. They, like everyone else, are in favor of closing the deficit only if it can be done with their preferred method; they are not interested in closing the deficit by giving up some of the things they care about. In other words, closing the deficit is very far down on people's lists of priorities. This is not a moral observation; it is, I believe, a statement of fact. Asked to choose between any programme they think is important, such as Medicare or HUD or TANF, they will choose to run a deficit. Republicans asked to choose between military spending or tax cuts, and a deficit, will choose to run a deficit. If people cared very much about the deficit, they would be willing to cut programs they care about, as well as programs they don't. Since no one is, I infer that no one does.

If liberals come forward to say that I am wrong, and the budget deficit is important enough to kill something besides the trivial amount of money this country spends on ag subsidies and corporate welfare, I will be happy to acknowlege that I was mistaken. Personally, I'd be happy to see the higher income tax rates restored to help close the deficit (though as I pointed out, that wouldn't really get us very far), but on the other hand, I'm not a tax nut, and also, I don't pay them, so how much of a concession is that really?

No, tax and spend is lethal because high taxes damage economic growth.

Jane,

As long as you obviously prefer Republicans and make excuses for them in spite of the evidence, we'll keep identifying you as a hack.

It's good that you acknowledge (e.g. in this post) that Democrats are at least slightly better than Republicans for restraining the size of government. But a realistic look would also compare the slow rate of government growth the last time Dems were in power (1993-1995) to the current Rep regime and say that Dems are _much_,_much_ better on restraining government. Then we could all identify the fall in government and direct contractor employment under Clinton (mostly Gore's job, really) to the drastic rises under Bush I and Bush II. And then we could all agree that divided government under Clinton and Gingrich was even better than either all-Dem or all-Rep.

All that has nothing to do with rising revenues from tax increases or cap gains. Those helped, but the Clinton success was that we had the lowest rates of spending increases in decades. And that's true even if you leave out contracyclical welfare programs (never much of the federal budget).

Combine that with the preeminence of the bedroom police state faction within the modern Republican Party and no one with a free minds and free markets philosophy could lean Republican or prefer Bush unless she is a pitiful hack.

Sorry Jane. We'll be nice again when you come around. And we'll even cut you sokme slack for suffering under New York City Democrats; they're not much like the emerging libertarian Democrats.

GT wrote:

But between tax and spend and borrow and spend the former is better. It's not only more fiscally sane but it also makes the costs of government more clear to taxpayers.

...except that the instant the taxpayers realize the "real" costs of government, they complain like the dickens, while still latching onto any governmental coddling they can aquire. Since both parties seem to ultimately value power above principle, neither of them does anything about the deficit. Democratic leadership might indeed prove better at taxing, but given their persistent lust for such fantastically expensive toys such as nationalized healthcare (and an even bigger Medicare prescription drug bill than the one that was passed), it it highly doubtful that a Democratic leadership would improve on the deficit.

If the current state of affairs is "tax x and spend y where y >> x and deficit d = y - x," the only plausible outcome I can see from Democrats getting their way is "tax x + n and spend y + n where y + n >> x + n and d = y - x." Different priorities will be involved in how "y + n" is allocated, of course, but our good friend d sure ain't going anywhere.

From Brian, who ironically speaks of "hacks:"

All that has nothing to do with rising revenues from tax increases or cap gains. Those helped, but the Clinton success was that we had the lowest rates of spending increases in decades. And that's true even if you leave out contracyclical welfare programs (never much of the federal budget).

Then we could all identify the fall in government and direct contractor employment under Clinton (mostly Gore's job, really) to the drastic rises under Bush I and Bush II. And then we could all agree that divided government under Clinton and Gingrich was even better than either all-Dem or all-Rep.

And if you include Gulf I under Bush I, followed by the evisceration of military spending under the Clinton years, what do you get? Some argued that by the time Clinton left office, the military we had available could not have re-fought Gulf I, a war which was recognized by every mainstream standard of left, right, and international as legitimate. You may be airbrushing something important here.

Edit: I accidentally switched the order of Brian's comments, the second paragraph should appear above the first.

The ironically-monikered brain fails to note that many, especially Democrats, agreed in the 93-95 time frame that History Had Ended, thus allowing tanks and destroyers to be scrapped for mini-vans to be purchased by soccer moms, which greatly reduced spending impetus. Also, if the Democrats' major proposal of the era, HillaryCare, had been passed, the Democrats would have exactly zero to now yap about regarding spending restraint. Hack indeed.

Guys, I'm not trying to stage a Clinton-Bush celebrity cage match. I'm talking about actual people who are democrats. and republicans. Voters. Who clearly do not, as they so ardently believe, care about deficits. The CBO credits about 1/3rd of the 1990s deficit reduction to clinton's policies, and that is to his credit. it attributes about 35 percent of the increase in the deficit since then to Bush's policies since then, which is not to his. Having disposed of your desire to hear me say that Bush is not fiscally responsible, can we get back to the main [censored] point, which is that voters don't care about the deficit as much as they claim to?

Fair point. I accept that.

But surely we elect leaders so they can lead, no? Can't we judge that?

It's hard to worry about a deficit when spending and spening promises go up and taxes go down. To many people that's a free lunch.

To be filed under, "Yeah, we're in charge, but we're not to blame...." I love the smell GOP accountability in the morning, it smells like...well, nothing.

To be filed under, "We're not in charge, so we can pretend how much more responsible we would be if we had power..." I love the smell of Democratic escapist fantasy in the morning, it smells like...well, let's just say it is entirely appropriate that a famous Douglas Adams novel will see a film debut this week.

(Yes, I know you didn't actually say anything about what the Democrats would do. One good projection deserves another, as they say...)

Sigh. the point was not to take cheap shots at Democrats, or Republicans for that matter. The point was that people who think that they care about the budget deficit also endorsed Kerry's combination of taxation and spending--including, IIRC, Tim!--and therefore, don't really care very much about the deficit.

BS. I seem to recall that amid all your ersatz agonizing over whether to vote for Bush, you actually copped to not necessarily agreeing with all aspects of the Republican platform. It seems that when we have presidential elections in this country, we get to choose either the Republican or the Democrat, and we have to decide which, on balance, we like more (or dislike less). I have yet to cast a presidential ballot for anyone even vaguely resembling my concept of the perfect president. Yet here you are asserting that anyone who voted for Kerry can't possibly care about the deficit because Kerry's platform included new spending as well as tax increases. That's pure partisan hackery. Fess up, you're a Republican!

Since Bush was proposing programs that would cost about $3 trillion compared to the $2 trillion price tag on the Kerry proporsals the very things you are saying about Kerry suporters are even more true of Bush suporters.

If you are going to make these claims at least get your facts right.

Guys, why are you so emotional about budget deficits? I get less flack about abortion! All I have done is point out the obvious fact that budget deficits, dry, wonkish topic that they are, are somewhere around number 80 on the lists of things voters care about. Y'all seem absolutely desperate to prove that for Democrats, it's actually #73! Who cares? There's a Republican theory that Democrats have developed a bizarre emotional attachment to deficit closure because it's the single arguable achievement of Clinton's eight years. Freaking out when the topic of budget deficits come up tends to confirm those suspicions.

I can only speak for myself. What bothers me is equating the GOP and Dems on this when recent history shows the GOP is much worse.

Let's preface this one with my beliefs - on fiscal policy, I'm pretty damned conservative, and on the whole, I support Bush a lot more than any of the Dems I've seen around(though I disagree with his social policies). Now then...

On the issue of deficits, I'm personally of the belief that, barring situations like WW2, the government should always be able to fund its spending without any persistent deficits. A small minus one year is nothing to be worried about, but I don't want to see anything large-scale or on an extended timeframe. Now in practical discussions, this means that I think that the US government should cut social spending(and corporate welfare and ag subsudies too), but that's because I think that the taxes currently being charged are more than sufficient to cover the costs of what the government should be doing. If, however, we were in a situation where they weren't, then I would support higher taxes, reduced military spending, or whatever else it would take to restore long-term balance to the system.

Also, FWIW, just because Jane says something mean about your guy, or because she makes a blanket statement, or because she states something about one side without doubling the length of the article by mirroring every sentence, that doesn't mean that she's a partisan hack.

Oh yeah, and it's also worth noting that I'm a Canadian, where both major parties are about equal on the deficit issue. The Liberals started and ended the deficits nationally, the Conservatives started and ended them provincially, and the government of the other stripe ran big ones in between. And both parties support balanced budgets on the whole(though the provincial Liberals are kinda faltering on that one right now). Maybe my difference in outlook is because balancing the budget is considered common sense instead of a major debate point up here, but the above is what I believe nontheless.

that doesn't mean that she's a partisan hack.

I can't speak for everyone, but I think some people may come to that conclusion because of the number of posts about different subjects (Mexican election law, Tom Delay, etc.) that inevitably come around to "oh by the way, the Democrats did something just as bad," often with a very flimsy equivalence. It happens so often that one can't help but note the formula.

Yeesh. If there's a case being made here, it's the case for closing comment sections on blogs.

"But between tax and spend and borrow and spend the former is better."

I tentatively agree. Unfortunately that was not an option presented to us. (And neither was the best option, *not* taxing and *not* spending). Jane is absolutely right; the Democrats were insistent on repealing the tax cuts, not to cut the deficit (which could have gotten me to support them), but to allow even more spending. So given the choice between tax, borrow, and spend enormously; or borrow and spend merely hugely, I have to reluctantly choose the latter. That being said, Bush has astounded me with his prescription drug giveaway that Congressional Republicans would rightly have railed against had it been proposed by a President Kerry.

First, let's dispose of the idea that Clinton eviscerated the military. It takes two to four years to really expand the U.S. military outside of a national emergency because of budgeting time scales. And we didn't expand rapidly after 9/11. That means we fought simultaneously in Afghanistan and Iraq, conquering both nations, with the Clinton military. And most of the drawdown after Gulf War '91 came in 1991-1992 as on-demand national guard resources were released, returned, repaired, and upgraded.

So Clinton made the military somewhat cheaper, but equally effective. Where the Clinton budgets really clamped down was domestic spending.

Second, HillaryCare would have been a disaster, just as Bush's big pharma giveaway disguised as a medicare drug plan will be. That's why even a better party needs an opposition. I assume that anyone who brought that up must stand with the partisan Democrats 100% against the so-called "nuclear option." As I do, even though I'd really like to see a Posner, Kozinsky, or Scalia type on the Supreme Court.

Third, I don't agree with Jane at all that people don't care about budget deficits. There is some evidence that deficits aren't the top priority for some political leaders, but _one_of_every_five_ U.S. voters chose an obviously insane texan for president in 1992 because he talked apparent sense about deficits.

Y'all seem absolutely desperate to prove that for Democrats, it's actually #73! Who cares?

Apparently, you do. Otherwise why would you feel the need for a "look, Democrats bad too!" post the year after the election, when Republicans have near-total control of the federal budget. It would be possible to post about the politics of deficits in a less partisan manner, and then we could have a conversation about the incentives for politicians of both parties to ignore the connection that should exist between levels of taxation and levels of spending, what we, as voters, might do about that, and so forth. You didn't choose to write that post. Instead, you chose to take a swipe at Democrats. The response shouldn't be surprising.

Oh, I see. So if I mention anything bad about Democrats, in the same post as I mention bad things about Republicans, I'm a partisan hack. But if I criticise Democrats without criticising Republicans, I'm a partisan hack. In fact, unless I do nothing but criticise Republicans without criticising any Democrats, I'm a partisan hack.

Whatever.

In fact, unless I do nothing but criticise Republicans without criticising any Democrats, I'm a partisan hack.

Hmm.....

;)

And Brian, you're factually incorrect. The decline of military spending was greater than the decline in domestic discretionary, except for the couple of years that Uncle Newt and his Merry Men were firebombing the budget process, and accounted for a much greater proportion of the closed budget gap than did declines in domestic discretionary. Military spending actually went down; domestic discretionary continued to grow, albeit at a slowed pace, particularly after 1994, except for one year when the Republicans seriously tried to implement the CWA. I have absolutely no interest in debating which president is better--IMHO Clinton was, Kerry wasn't, but I don't care because neither of them is in office--but the budget is one of the areas that I follow professionally. I think Bush is a fiscal disaster, but I don't think that anyone except Peter Orszag has the political stomach for what it would actually take to close our current deficit, which would include raising taxes *and* hefty cuts in domestic spending (clawing back Iraq is both impossible at this point, and not very helpful going forward, since after 2005 it's unlikely to account for a big share of the budget deficit).

Jane, you are factually correct. But when Clinton came into office, a practice called current services baseline budgeting was in place. That meant that expected increases in spending needed to maintain programs at their present level of effectiveness was projected into future budgets.

The baseline for military spending was cut slightly through technology and base closure measures, and there was a known and expected savings from reducing cold war obligations (the "peace dividend"). The level of service was maintained, though.

The baseline for domestic spending was cut much more. Therefore my argument was both factually correct and non-misleading, unlike the arguments from folks who seem to want forever increasing military spending regardless of need.

And yes, Kerry was an awful candidate. But even a pretty bad Democrat was better than this. Now take a Democratic ballot in '08 and help us nominate a better guy.

Well, yes, brain, the Soviet Union collapsed and thus defense spending was reduced. What any of this has to do with Clinton Administration's budget discipline (I'll take it you concede that, on the domestic side, their greatest discipline was demonstrated by being incompetent in having their centerpiece domestic program passed) is somewhat puzzling.

BTW, I agree with Meaghan, in that a small percentage of voters really care a whole lot about fiscal discipline. If it were otherwise, balanced budgets would be a common occurence, and more tellingly, administrations would be loathe to put out projections that forecasted large deficits well into the future. They do so because the political cost is small.

Ta-daaa! Will Allen cuts through the, uh, smoke.

I am amazed at the comments and commenters coming out of the lurkwork. It speaks well of our hostess that so many people who think she's a "partisan hack" apparently still read her regularly; myself, Kos makes my hair stand on end and I have to do yoga breathing to recover.

Sheesh. Of course most voters care little about the deficit. Perhaps we ought to care more. But it's hard to get as worked up about it as we ought when the prospect of a bankrupt America seems so ludicrous. The politician who can tell, straight and clear, what the effects on ME (speaking figuratively) will be when we have no money left, and give me a supported estimate for when it'll happen and a supported reason for how we can act now to prevent it - that politician will make us lumpen masses care about the deficit. IMHO, as a member of the lumpen masses.

Easy solution for those who think Jane is a "partisan hack" (or rather, that she's on the wrong side...there are of course no hacks on the good guys' side): Don't read this blog no more. Simple, yes?

To Daily Kossery, go.

"But between tax and spend and borrow and spend the former is better. It's not only more fiscally sane but it also makes the costs of government more clear to taxpayers."

Who says it's better? That depends entirely on the amounts of taxing, spending, and borrowing. it is an empirical question, and it is why we have econometrics.

Making the costs of government more clear to the taxpayers? Perhaps we need to recall our public choice theory.

There will NEVER be widespread support for cutting spending under our current system. It's simple numbers. The bottom quintile of earners pay negative income taxes. The fourth quintile pays no income taxes. The middle quintile pays about 5% of the income tax burden, the second quintile pays about 20% of income taxes, and the highest quntile pays about 80% of income taxes.

This means 40% of the electorate will always support higher spending and higher taxes, 40% is mostly indifferent, and only 20% has any strong incentive to reduce either. There is no support for cutting spending precisely because most people know exactly what the costs of spending are and don't have to pay them.

Yes, it's very easy to support "fiscal discipline" when it means taking more services for yourself, paying nothing for it, and making "the rich" cough up the cash.

Want to limit spending? First, eliminate withholding. Second, eliminate tax deductions for employers for contributions to employee pension plans and employee medical insurance. Third, eliminate the corporate income tax. Fourth, create a flat income tax with no exemptions or deductions. As a freebie, I'll say to remove the payroll tax cap.

Watch 60% to 80% of the population immediately swear eternal enmity to any politician who does not immediately vote for massive cuts in federal spending.

Here's a big AMEN to what AT said.

For myself, I had to really hold my nose to vote for Bush in 2000 - the option being a protest vote for the Libertarians. I think most people realized that "compassionate conservatism" meant we could expect little-to-no spending discipline from a G.W. Bush Administration. At least, I understood that.

Had 9/11 never happened, I seriously doubt Bush would have gotten my vote in 2004. However, there have been bigger fish to fry than deficits. I remember having a discussion with a friend back in mid-September, 2001. We both agreed that any chance of cutting federal spending in the near future had gone up in smoke in New York and Washington, DC that fateful day. We also agreed that this was a small worry in the uncertain world we suddenly found ourselves in.

If the Democrats want my vote, they'll first have to convince me that they can be trusted on national security (something I simply cannot imagine them convincing me of, for reasons too numerous to go into here). Second, that they're less likely to erode my and my children's personal freedoms than the Republicans (more possible, but still not that likely). And third, that their claims of being opposed to deficits are anything other than veiled threats to raise taxes as fast and high as they can on everyone they don't consider a core constituency while spending wildly on everything but defense.

In short, as terrible as I think the Republicans have been on spending, I've yet to see anything to make me believe having a Democrat (that actually has a chance of being nominated) elected President would be noticeably better. The only hope for a respite would appear to be gridlock. But, it doesn't look likely that the Repblicans will loose Congress, and I don't trust the Dems with national security enough to support one for President.

All this blather about Clinton vs. Bush vs. Kerry is just that -- blather. I've lived through several decades, observing how both parties behave when they're in power. This argument is sort of like watching two college fraternities holding a debate in the package store parking lot, each arguing they are more sober than the other based on their liquor preferences. Any differences are not enough to brag about, and their choice of intoxicant is immaterial to the issue.

Which brings me to Jane's original point that the voters don't care about the budget deficit. While that's probably true to some extent, I propose that it's difficult to tell voter apathy from voter cynicism. I personally don't vote based on the deficit because I don't believe a word either party says about the issue. That doesn't mean I don't care about it.

People have an archaic conception that deficits are a failure to raise enough money from taxes. There is a demand for treasury bonds, and selling them is a perfectly legitimate means of raising money for the government. Deficits are perfectly progressive. Bonds are voluntarily sold on the open market where the people who buy them are the people who can most afford them. Bonds harm the economy because extra money must be spent on interest. Taxes are involuntary, and harm the economy because deadweight loss and disincentives reduce growth. The question is do deficits matter more or less than taxes at current levels?

In theory, to maximize the net benefit of government, the budget should be balanced so that the marginal harm of deficits equals the marginal harm of taxes equals the marginal benefit of spending. The political equilibrium is probably quite different from the economic equilibrium.

It is a complete mystery to me why libertarians insist that all funds be raised involuntarily, by a balanced budget, rather than voluntarily by selling bonds.

Myclin wrote:

In short, as terrible as I think the Republicans have been on spending, I've yet to see anything to make me believe having a Democrat (that actually has a chance of being nominated) elected President would be noticeably better. The only hope for a respite would appear to be gridlock. But, it doesn't look likely that the Repblicans will loose Congress, and I don't trust the Dems with national security enough to support one for President.

Just out of curiosity, where do people get the idea that “divided government” automatically leads to “smaller government”? I know that people love to point to the overall macro situation with the last few years of the Clinton administration (back when being House Speaker meant something) but it’s worth noting that Clinton used “divided government” to push for larger levels of spending and got in during welfare reform.

Also we had divided government during Bush’s first term when Democrats controlled the Senate. The result was Tom Harkin got his farm subsidies back, Ted Kennedy wrote the education bill, and we went from a 3-4 increase in overall discretionary spending to double-digit increases in non-defense/non-homeland security spending because both parties wanted to “get something done” and Democrats had leverage enough. Moreover, I doubt we would have even had the Medicare prescription drug monstrosity had Democrats not had enough power in the Senate to threaten a filibuster thereby bidding the bill up.

Moreover we also had “divided government” the last time we tried to reform Social Security back in the 1980’s. The result was that Democrats got a tax increase and Republicans got nothing in the way of an investment option. Considering the ticking time bomb of entitlement programs and Democrats unwillingness to support any plan to reduce the overall size of these programs (they’re pretty committed to tax increases), it seems to me that the only hope we have of dealing with this mess prior to the retirement of the baby boom generators is to elect legislators and a President who is pro-reform which right now means Republicans.

Don't read this blog no more. Simple, yes?

Why, do you only read stuff you agree with? Or do you mistake disagreeing with some share of what a person says with finding the person useless?

Brittain, I don't read those that I consider to be "hacks", whether they have political leanings similar to mine or not. Why you would is somewhat puzzling.

I'll certainly agree that most voters don't care much about deficits and that Kerry's platform was not a fiscal conservative's ideal.

But ...
Kerry did endorse Paygo and I remember him saying that all his spending plans were conditional on the money being there and that he was prepared to make hard choices if it was not.

In contract, I seem to remember Bush suggesting that his Medicare drug benefit might save the government money. I never remember him talking about paying for anything. All I can remember is occasional talk about moderating the growth of discretionary spending.

In talking about raising taxes, Kerry was at least willing to talk about taking some medicine. Bush is all candy store, all the time.

For whatever reason (and I think Jane may be right about why) the Democrats are now the fiscally conservative party. And they deserve some credit for that. False equivalences certainly do nothing to advance the cause of fiscal conservatism.

Tom

Anyone can declare himself "prepared to make hard choices" in the abstract. It means absolutely nothing unless you actually go ahead and make them. It was already known, at the time of Kerry's noble display of hypothetical resolve, that the money wasn't there; his willingness to make the hard choices required by paygo turned out to be on a level with his willingness to authorize the release of his military records, or his willingness to disclose his plans for Iraq.

TDM - If it was as simple as people handing money to the government, sure, I'd be all for it. But it's a loan, which means they expect to have it get paid back. That means that it's either a pyramid scheme or a method of deferring taxation. I hope you'll agree that a pyramid scheme is bad, especially on that scale, and there's no great libertarian argument for taxation being deferred. Selling bonds doesn't mean that the spending doesn't have to be paid for, which completely eliminates your argument.

Alsadius - You roll over the debt in the future, it's a ponzi scheme. A ponzi scheme is stable if the payout (debt payment) does not outgrow the base (GDP). Debt can always increase as long as the debt/GDP ratio is stable. We can keep paying for a share of our spending with bonds as long as GDP is always increasing. Have you noticed all the people who support another ponzi scheme that is slowly outgrowing its base, Social Security?

A ponzi scheme is a bad private investment. However, there is no better way to fund a government. The government, unlike the private sector, should not earn money by selling goods and services. That would be socialism. The government can raise money with a voluntary ponzi scheme -- debt, an mandatory ponzi scheme -- Social Security, or a zero-payout mandatory ponzi scheme -- taxes. Money should be raised by the combo of the above that minimizes the harm done to raise the money that the government spends. Every libertarian argument for balanced budgets is for current taxes over deferred taxes. I have not seen a libertarian reason to prefer taxes over a stable voluntary ponzi scheme.

Paul,

So let's be clear about this:

Candidate A: I will raise taxes. Here is a proposed spending program but I am willing to cut it if I need to..

Candidate B: I will cut taxes. I have no actual plans to reduce spending. My primary domestic objective will lead to a huge increase in our explicit debt in the hopes that I can force future congresses to accept spending cuts in the 2040s and beyond. I make absurd claims about my previous spending increases.

Are these really equivalently responsible?

If that does not make it clear, consider the 'strarve the beast' strategy. Republicans think they can make the deficit so bad that Democrats will be forece to give up their priorities in the name of fiscal responsibility.

Tom G

Brittain, I don't read those that I consider to be "hacks", whether they have political leanings similar to mine or not. Why you would is somewhat puzzling.

Will, here's what I wrote in the post you replied to. It should indicate how I feel about Jane's writing.

do you mistake disagreeing with some share of what a person says with finding the person useless?

I think that some subset of posts here are hackish, because they're structured just to twist any issue around to insult the Democrats, even if the case is weaker than my grandmother after she's done a set of dead-lifts.

There are, in fact, other posts on this blog that don't have that purpose. Jane's a great writer and much better-educated than I am, which is why I enjoy this blog. I don't agree with everything she says and I certainly don't agree with the approach of "hmm, how can I stick it to the Democrats" that comes with several types of unrelated subjects, but that doesn't stop me from wanting to read and discuss the other issues.

I think I'd enjoy it more if the non-partisan issues got at least a tenth the number of comments that the partisan issues got, but such is human nature.

Candidate A: I will raise taxes. Here is a proposed spending program but I am willing to cut it if I need to..

Candidate A's critics: You do need to. Why aren't those cuts already in your spending program?

Candidate A: (crickets.wav)

Myclin, I stand corrected... I think you're right, it's more about voters' awareness that politicians of any stripe mean a minimum of what they say, than actually about deficit apathy. But it does seem to me that "out-of-control deficits!!" is semantically near-null to many of us (though I'd guess we ordinary folk are grossly underrepresented among commenters on this blog), for whatever the reason.

Amen! to the original post

Kerry did endorse Paygo and I remember him saying that all his spending plans were conditional on the money being there and that he was prepared to make hard choices if it was not.

And the rest of us remember that he voted for most of or higher levels of spending than we have right now (particularly since the major non-D/HLS discretionary spending increases occurred when his party controlled the Senate) and said that his $895 Billion “health care plan” was a greater priority than deficit reduction. It also hasn’t escaped our attention that he is decidedly anti-entitlement reform including opposition to something as commonsensical as means-testing any prescription drug benefit and phasing in a higher retirement age for Social Security.

Jane's right. No one cares about the deficit. We're broke. All we're doing now is sitting in the stadium seats munching popcorn and watching the disaster unroll. Too bad it will take so long. A punchy 2-hour fiscal disaster would fit our society so much better.

TDM - If it was sustainable, sure, I'd be all for getting something for nothing. But remember a couple of things here. One, the money is loaned out because people think that they will get it back. If the government's only revenue stream is Ponzi, you'd have to be insane to give them money. As it stands now, the tax system is made such that we can pay down our deficits at some future point, and so carrying a large debtload isn't a worry. However, under your system of openly saying "Yeah, we're never going to pay this all off except by getting more loans", you're destroying that system.

Further, in order for the debt-to-GDP ratio to even stay constant, interest rates have to be persistently lower than GDP growth(which I don't believe has ever been the case for any extended period of time) - and that's assuming that all actual spending is covered by taxes, and that it's only interest you're trying to Ponzi away. I'm sorry, but that won't work. What you're trying to do is take the lender's trust in government securities, which exists because the government has a viable method of covering its debts, and abuse that trust by eliminating any rationale for having it. It might work for a few years, but as a persistent financing scheme, it's utter insanity.

And besides, what exactly is wrong with the government selling goods and services - don't say "that would be socialism", explain to me why a government corporation, properly run, would be a bad thing for a nation to have. I'd much rather there be a stupid tax(lotteries) than an actual tax - you?

Brain,

Clinton eviscerated the military. I know; I was in it until I retired from the Reserves in 1996. And my son has been in it since 1996. The late 90's saw promotions like during Vietnam, junior officers were leaving right and left, and airplanes were again being canabalized for parts to keep others in the air. Total number of ships dropped, as did total number of active duty personnel. Units were reorganized with fewer people in them. Even by the time we went into Iraq for OIF, we were physically unable to mount the same sort of offensive we did during Desert Storm.

Did we get the job done? Of course. We (the military) always will. But the price we are paying is still to be felt--we have Reserves and National Guard forces on extended active duty simply because we don't have the active duty forces needed for all our present commitments.

Three choices here: (1) reduce the commitments, (2) increase the active duty forces, or (3) pay the piper down the road. So far, we have opted for #3, which as always is ultimately paid for in blood.

Jamie wrote:

But it does seem to me that "out-of-control deficits!!" is semantically near-null to many of us (though I'd guess we ordinary folk are grossly underrepresented among commenters on this blog), for whatever the reason.

I agree, there are a lot of voters who either don't care about or don't understand the issue well enough to get exercised about it, to which you can add those of use who care but have given up on either major party actually addressing the issue. Makes me wonder why the Democrats are beating their highchairs over it so. Either A) I'm wrong, and this is a real issue for a significant number of swing voters; B) the Dems are politically tone deaf on this issue (much as I think they are on national defense); or C) they're just trying to keep the other side off balance until they can come up with a real issue to exploit.

Whatever.

Mycin

I don't think the deficit problem lies with the Democrats or the Republicans. And I don't think divided government is the answer (think of the Reagan years).

I think it's a structural issue. First of all, the separation of powers actually means less accountability: one branch can blame the other branch for a problem (like the deficit), allowing both to ignore it (which is exactly what happened in the Reagan years). Second of all, term limits means the President has little incentive to worry very much about the long-term impacts of a growing deficit. Somebody else will have to clean it up.

But we have these two things for a reason, so it's not clear to me what's the best option.

Bread and circuses...

Paul,

As I said in the beginning, " Kerry's platform was not a fiscal conservative's ideal."

But my point has always been that Bush was worse from a fiscal conservatism stand point.

Pretending that everyone is equally bad is self-defeating.

Tom

Thorley,

My question is: are Republicans and Democrats equivalent on fiscal reponsibility today. Not are the Democrats ideal - I am happy to admit they are not. But neither do I regard the differences as trival as Jane does.

To criticize Kerry for not reducing entitlement spending is pretty rich here. After all, what exactly has Bush done on entitlement beyond create new ones (drug benefit, farming)?

To ask the Democrats to push for lower spending and higher taxes while the ruling party does neither seems like asking a lot to me.

Tom

fling93 wrote:

I think it's a structural issue. First of all, the separation of powers actually means less accountability: one branch can blame the other branch for a problem (like the deficit), allowing both to ignore it (which is exactly what happened in the Reagan years).

Second of all, term limits means the President has little incentive to worry very much about the long-term impacts of a growing deficit. Somebody else will have to clean it up.

Good points.

Further regarding accountability, another structural problem I see is the modern media and the celebrity status it gives to the President, at times approaching a cult of personality. The power and responsibility of the Congress is lost to the bright light of the Presidency. The Constitution explicitly places control of the government purse strings in the House of Representatives. But many (most?) people, in and out of the media, credit or blame the POTUS for budgetary successes or failures.

Tom G. wrote:

To criticize Kerry for not reducing entitlement spending is pretty rich here. After all, what exactly has Bush done on entitlement beyond create new ones (drug benefit, farming)?

To ask the Democrats to push for lower spending and higher taxes while the ruling party does neither seems like asking a lot to me.

The Democrats are the ones saying they can do better than the ruling party. Why is it unreasonable to ask them to do so? If they want to their claims as budget hawks to be taken seriously, they should start walking the walk, even though they're currently in the minority.

Mycin

On the cult of personality:

I think we've never outgrown our desire for domestic royalty. It's fun to have a king or queen, as long as s/he isn't taking too much notice of you. It leads to all kinds of enjoyable pomp, a market for nice - or over-the-top - dresses (look at how much play stupid "red carpet" extravaganzas get!), a need to recall the use of the fish fork and the salad knife... And it's handy, because it's easier to blame troubles on a point source than an "environmental" condition such as the makeup of Congress.

I agree that the dems would likely spend the money from the tax cuts. But the dems don't run as the party of fiscal responsiblity, and they don't have a tax cut no matter what agenda. Bush planned these tax cuts prior to 911, prior to the massively expensive dept of Homeland graft, and prior to his very expensive war in Iraq. Any one of those expenses would have been good reason to roll back the tax cuts, on top of that there is also the moral ground of shared sacrafice during war time as a reason to roll back the tax cuts. But he didn't consider any of that for a second. He shifted the argument by stating the tax cuts were needed as a "temporary stimulus" because of the rep redefined recession. Now he wants to make the tax cuts permenant, and that sure aint temporary.

Its one thing to create debt for things like Universal Health Care, more Cops, better education, etc. It's reprehensible to take on debt so the highest earners get richer. All politics are class warfare, and its clear who the reps support. The dems aren't much better, they are really the party of the upper middle class, but at least they throw the poor some crumbs.

I just scrolled through the comments and I can't quit laughing. The idea that the level of military spending during the Clinton years "eviscerated" the miltary and is the reason 911 occurred is complete bs. An event similar to 911 is just as likely to occur today as it was in 2001. The borders now let 25% more illegals across then at the beginning of the Bush senten..er first term. Its just as easy to get a drivers license. Its just as easy to get in flight school. Its just as easy to get box cutters on planes. I don't expect to see another 911, but a situation of multiple, simultanious Beslan style attacks on schools would be easy to accomplish, considering the border and ease of obtaining an assault rifle. The military can't protect us from everything, and there are non military solutions to making us safer.

I just scrolled through the comments and I can't quit laughing.

Probably because you scrolled through them, rather than reading them.

The idea that the level of military spending during the Clinton years "eviscerated" the miltary and is the reason 911 occurred is complete bs.

What evidence you have to claim the first is "complete bs" you haven't bothered to reveal, and the second is an argument nobody has made (at least, not in this thread).

Mycin,

I am saying the Democrats better, just not ideal.

Increasing taxing and proposing conditional increased spending is better for a fiscal conservative than decreasing taxes and increasing spending and fighting rules that would put an end to the party.

Tom

Tom G,

As much as I'd like to, I can find nothing to dispute in your post. Such is the sad recent performance of the Republicans on spending.

Not that I find the Dems' proposals good, mind you (much less beyond criticism, as you suggest in your first post), and not that I believe a word of the "conditional" claptrap. But taken at face value, their "talk" is less bad than the Repubs' recent "walk" in terms of balancing the budget.

Oh, for a truly small-government party that wasn't psycotic!

Mycin

Depends whose tax cuts. See this --
http://www.csmonitor.com/2005/0414/p03s01-usgn.html

If "liberals" (a nonsense pejorative peculiar to the US) care more about ending Bush's regressive tax cuts than reducing the deficit, good luck to them.

But I doubt you can usefully generalise about Democrats in the way you do, Jane. Nor can you pretend that your observation significantly minimises the stark contrast between Clinton's fiscal rectitude and Bush's rectal fiscitude.

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