The chink in the Democrats’ armor
I’ve reported here repeatedly that the Democratic Party is riding a long-term wave of demographic and cultural trends that bode well for its future.
A more urban, multi-ethnic, women-empowered society — and those are all measurable, real-world changes our nation is experiencing right now — will almost certainly benefit the party of Obama and Pelosi.
But as we head into the crucible of the 2012 election, there is still a massive, gaping omission in the story that the Democrats are telling to voters, one they will need to remedy if they are to become the party of the future.
Put simply, Democrats need to explain how they will pay for the government which they believe America wants and needs.
Before I explain what I mean, let me detour for a moment to point out that Democrats don’t need to spend much time or energy arguing in favor of their vision of “big” government.
By overwhelming margins, Americans support all the big-ticket items that make up about 90% of the US budget, from Social Security to Medicare and Medicaid, to education, the military and homeland security.
Yes, we all grumble about pork and waste. But that’s just the normal bird-dogging of citizens who, quite reasonably, want to get good value for our tax dollars.
There is no evidence that voters have bought into the broader, conservative, Ron-Paul-esque notion that the fabric of government itself needs to be unraveled or dismantled.
When pressed, Americans are even pretty comfortable with the idea that there should be an appropriate safety net, to help citizens who stumble, or fall into poverty, especially if they are children or senior citizens.
And we also want — indeed, we demand — a robust network of police and first responders.
The big question, then, isn’t what government should look like in the future. The real question — and, yes, I lay this predominately at the feet of Democrats — is how to pay for it. How to sustain it over the long term.
Currently, roughly half of all US spending is borrowed. Which means that any vision for a long-term, stable government on the scale that Democrats (and their constituents) want will have to include some enormous changes.
Some cherished services will almost certainly have to be cut, not because we oppose them ideologically but because they are just too expensive.
I’m guessing that in the future people probably won’t be able to retire at age 65 and draw government checks for the next quarter century.
Other services will have to be provided more cheaply, either by allowing the private sector to deliver them (not always the solution, but in some cases it will help) or by demanding concessions from public employees.
(The era of lifetime health insurance and pensions ended long ago for private sector workers, and I’m betting the time has come for public sector workers to see a big change as well.)
We will also have to generate a lot more revenue. Some of that will come from growth, as the economy bounces back, but it’s also time to level with the American people: all of us will have to pay more if this is really the government we want.
Taxing rich people won’t get us there.
The short-term reality, of course, is that Republicans will block enactment of any vision that achieves a sustainable balance. They’ll argue that even when balanced with spending cuts, any new tax revenues are a socialist scourge.
But that doesn’t mean Democrats can’t or shouldn’t lay out what their plan looks like.
On the contrary, that vision should be the cornerstone of an honest campaign, both for Mr. Obama and for Democrats running for congress.
Some on the left will point out that Republicans have also quietly embraced big government, and done little to bring down our national debt. This is true.
Most economists believe the various budgets put forward by GOP leaders over the last year would grow rather than shrink the long-term deficit, because of massive tax cuts that aren’t off-set by spending cuts, and because of plans to grow the military.
But fair or not, the identity and core values of the Republican Party aren’t linked to the health, quality, and sustainability of the Federal government.
On the contrary. Many conservatives would be quite cheerful seeing even good programs cut or eliminated, even if it requires insolvency to get us there.
So for better or worse, Democrats carry the torch of the government model created during the New Deal. They will be the ones to figure out how to pay for it, and put it on an even keel, or no one will.
Until President Obama, Senate Majority Leader Harry Reid, and Minority Leader Nancy Pelosi put forward that vision, they will remain vulnerable to the suggestion that their vision, no matter how laudable or popular, is simply a pipe dream.
And right now, that pipe dream is adding about $1 trillion a year to the national debt.
As always, your comments welcome.
Tags: analysis, election12, politics
Which is why ALL the Bush tax cuts should be allowed expire. An analyst I heard yesterday observed that the Greek problem isn’t because socialism is a failed idea but rather it is because people want all the programs but don’t want to pay for them. Germany has a similar set of social programs but mush higher taxes than Greece and Germany isn’t in the fiscal straits that Greece is. We need to face up to paying the bill for what we tell the politicians we want. We were doing that when “W” took office but we got sold a bill of goods that we could lower taxes and the resulting growth would make revenues go up to compensate. Now there’s a failed idea for you.
“And right now, that pipe dream is adding about $1 trillion a year to the national debt.” That’s all it is and all it will be. If their was a solution the voters would accept don’t you think the Democratic party would have presented it long before this? The Keystone pipeline would have been a good source of tax dollars but Obama was too busy pandering to the enviromentalists. Even his buddy Buffit thinks not supporting the pipeline was a mistake.
You can’t tax the rich, they will denounce their American citizenship to avoid paying taxes. Tax businesses and they head for foreign shores. What’s left…the middle class?
Gary –
That’s just not accurate. We tax the wealthy and the middle class significantly less now than we did in the 1990s when the US (briefly) ran a surplus.
There was no mass exodus of rich people, in large part because many parts of the world already tax rich people at a far higher rate than we do.
The suggestion that there’s just no way to find a way to pay for a sustainable government of the size we all want is belied by American history.
–Brian, NCPR
We could certainly move back to the tax rates we had in the 1990’s. I think a compromise and a smart one would be at the same time to significantly lower corporate income taxes, which in the US are some of the highest in the world. Corporations spend a lot of effort avoiding them anyway and they don’t raise that much tax revenue.
When was the last time we were able to raise taxes in this country?
For a starter these guys need to raise the social security tax back to normal levels before that program really is destroyed.
Brian said: “The era of lifetime health insurance and pensions ended long ago…”
So Brian, do you think going without insurance is good and necessary policy? That’s really a radical notion.
Also: “The real question — and, yes, I lay this predominately at the feet of Democrats — is how to pay for it.”
Why? Democrats didn’t create the deficit. Republicans did. The other thing: The answer to this question always seems to be some version of “Cut programs that help poor people” and leave rich people alone. Because every time someone like you says something like this–“Taxing rich people won’t get us there”–the conversation moves on to “so we shouldn’t tax rich people.” because it won’t solve the entire problem, the thinking goes, then we shouldn’t consider it.
Also, too, Brian, this: http://thinkprogress.org/economy/2012/05/15/484452/facebook-zuckerberg-avoid-taxes/
Facebook grew out of the Internet, a government-funded, government-invented entity. And it won’t pay its fair share of taxes. No, making Zuckerberg, et al, pay their fair share of taxes won’t support all government. But how does not making them pay their fair share of taxes help what in your words is this dire crisis of government?
Oh, I remember: By privatizing social security and forcing public employees to give up health insurance and retirement benefits. We need to pay for people like Zuckerberg to continue to live in the manner to which they’ve become accustomed, at any cost. it’s a choice we’ve made, one which even liberal NPR supports.
Glad we’re all in agreement here. There’s no wisdom like conventional centrist Washington wisdom.
Okay, not to go all JDM on you here, Brian, but I’m going all JDM on you here: Please, please, retire the cliche in your headline. It’s kind of problematic:
http://deadspin.com/5886322/espn-fires-chink-in-the-armor-scribe
On the military end, I think we should cut back on the Army. Why? Because we can kill all our enemies with air and sea power. The Marines and a smaller Army should be enough clean up what bombs and rockets leave behind.
We spend way too much on the criminal justice system. With police, sheriffs, the FBI and the CIA, do we really need the ATF, DEA and ICE?
Cut back on subsidies to business. Go back to the taxes had before the Bush tax cuts. Go back to what it was for Social Security (Payroll tax). Freeze pension contributions by all levels of government. Freeze government contributions to the cost of health insurance. Make those covered by government contributions to health insurance make up the difference if the rates go up.
No more free health insurance or pensions for elected officials.
Then for more tax revenues, legalize prostitution and all drugs and tax them but at a reasonable rate – not like the absurdly high taxes placed upon cigarettes.
These will do for a start.
James Bullard, I think it is time to stop calling them the Bush Tax Cuts. Republicans want to pin all the blame on Obama for the deficit and the state of the economy so I think is tis only fair to point out that Obama gave a massive tax break to high income earners. And it is time for Obama to stop messing with the tax code and allow his tax cuts to expire.
Okay, to Brian’s points (by my usual tactic of attacking his premise).
The first thing that is really important is for the major media to get a spine and attack dis-information that keeps cropping up. Maybe then we can start talking about information on a level playing field and not on a Calvin Ball Court. Let’s all recognize that the Republicans have been responsible for huge growth in the size and cost of government and in ballooning the size of the deficit and the debt.
The next thing to be done would be to recognize that for decades many Democrats have offered lots of ways to reduce the deficit and the debt. If the Democrats could have enacted all of the cost cutting proposals that I have forgotten they even made we would probably have a balanced budtget and be debt free.
Okay, so a few simple proposals to reduce costs and increase revenues.
Slash military spending. Close half of all military bases mostly overseas.
Return the Capital Gains Tax rate to the amount Ron Reagan increased it to, 28%.
Eliminate the cap on Social Security income tax.
Increase the age for full SS benefits by a couple years a little at a time over several years. But maintain the lowest age limit for getting benefits at reduced levels.
Eliminate the mortgage tax exemption or cap it.
More later.
The first thing that is really important is for the major media to get a spine and attack dis-information that keeps cropping up.
The media just doesn’t see this as their job anymore.
OA- Were you being sarcastic about the “chink” thing? I mean, there were no Chinese-Americans insulted as a result Brian’s headline, as far as I can tell. And if you can’t have a chink in the armor, what can you have to
designate weakness?
I think Knuck puts forward some good ideas (except I don’t agree with such large and rapid reductions in the military, though a lot can and should be phased out).
I hope Brian responds to to these points.
I am retiring the longer form of my screen name since, there will be no more portly, pompous, pretenitous, and prevaricating presidential poseurs to avoid being confused with from here on, I hope..
KHL, you left out cutting oil subsidies (and there are other entirely pointless subsidies out there begging to be cut– social welfare for big biz).
Spending for the military is outrageous. and the fear that we’ve been feeding since 9/11 has raised it to ridiculous. Eisenhower warned us a long time ago, he called it the military-industrial -complex, but we didn’t listen. Now the war/fear/war folks are in control, and filling their pockets is what it’s all about.
Imagine for a minute, what the world would be like if we (and the Russians) hadn’t decided to invest in the Cold War. Imagine if we’d spent all the money we wasted in the oil wars on renewable infrastructure instead.
Getting the rich to actually pay their taxes instead of hiring tax attorneys would help..a lot, but stopping the flow of blood money would help a lot more.
Well the issue is how do you propose new programs that don’t cost anything?
Let’s just do the time warp and return to the tax and spending structure of the Clinton era. Booming economy, reasonable tax rates, surplus being used to pay down the national debt. Works for me. Add in some slight tweaks to the Social Security payroll tax, such as raising the cap on income subject to tax, and we’re done.
One thing to keep in mind – things will get easier as we baby boomers pass from the scene. We’ve been like the bulge in a boa constrictor that results when it eats a large animal. There have been recurrent cries of alarm as we’ve passed from stage to stage. How are we going to get enough schools and teachers to educate all those kids? How are we going to find enough work for all the young adults entering the work force? And now, how are we going to provide for all the retirees? We’ve solved the challenges in the past. We can solve this last challenge, too – I just hope we don’t gut the future for our grandkids in the process. I hate seeing long-lasting policy decisions being made that don’t seem to factor in the fact that the population bulge that is stressing the system is just passing through.
Paying for it isn’t that hard. People just don’t want to. And the republicans keep telling people they don’t have to.
Newt, like most Liberals I am open to a reasonable discussion of how much military spending needs to be cut and how fast it should be done. Unlike the other side that seems to greet any proposal with one word, “NO”.
Walker, you’re right! Like I said, the Dems have offered too many proposals for sensible cuts for me to remember all of them.
ttm, you make an excellent point. Let’s have a few of our Conservative friends show some agreement.
Part of what Clinton did in the 90’s was cut the military. Hopefully we can start that process. We are in a new world, our whole military is still in many ways designed to fight a major ground war in Europe with the Soviet Union. That is what the F-22 was designed for, the b-2 bombers are the same, designed for a major nuclear exchange with the Soviet Union. Now they all have a life of their own, they are jobs programs is what they are. But you can hear the rumblings already, China is going to replace the Soviet Union as the new big threat that we need big weapons for.
I would think we would be ashamed to say our military is so bad, is so inefficient that we need to spend I think close to 10 times as much as the Chinese do in order for us to be safe from them.
We would have a lot more flexibility of we had the correct sized military.
Newt said: “I mean, there were no Chinese-Americans insulted as a result Brian’s headline, as far as I can tell.”
No, but anybody who hates tired, almost meaningless cliches was.
Speaking of the military, one thing we should have learned in our two recent invasions is the complete wrongness of using the National Guard on foreign soil. It is the National Guard – not the International Guard.
It is wrong to jerk these men and women from jobs and family to send them on multiple deployments to foreign countries. That is the job of the regular military.
If we go to war and more troops are needed, then our elected officials should act like grown up men and women by bring back the draft.
And it is totally idiotic to lower taxes while at war.
I totally agree Pete. It is not their mission. You are spot on also, if these wars are really important to our freedom then we should have a draft and we should raise taxes to pay for the wars. If the wars are not worth higher taxes and a draft they are not worth fighting.
“or by demanding concessions from public employees”.
which public employees? what this usually means is paying low wage public employees less by reducing their benefits to the level that low wage private employees now get. That’s going to do less for the deficit than raising taxes on billionaires a tiny amount. why does anyone (e.g. Brian) think this is a good idea? It just makes the lives of a few more low wage people a little worse.
The higher wage public employees are now already paid the same or less than their private counterparts (even taking benefits into consideration).
It is always easy to pick on wasteful spending by the government. Business does it too but as long as they aren’t getting some sort of government subsidy (which nearly all large businesses do) it isn’t really anyones business except the business owners.
That said, here’s a good waste of money for you to contemplate: Within the confines of Bagram Airbase in Afghanistan – an enormous and very well protected military base – is a NSA facility. The NSA facility has guards to keep it secure – as it should. But the guards aren’t Army, Air Force or Marine guards, they are private contractors. We taxpayers are paying probably something like $200,000 per year for each guard in the middle of a base where we have soldiers who are being paid a small fraction of that amount.
I know it is a small amount in the grand scheme of thing but it all adds up, and it would sure make me angry if I was in the military serving in Afghanistan.
Ah, but see, it makes a very deep-pocketed lobbyist very very grateful!
The government could cut military spending by 25% with ZERO threat to national security (and it would probably *help* national security by making fewer unnecessary enemies as we meddle in foreign affairs less). This money could be used on programs that actually strengthen America, *and* give working people tax cuts too!
“By overwhelming margins, Americans support all the big-ticket items that make up about 90% of the US budget”
It depends on how the poll question is asked.
For example:
Do you want free health care? (that would be a “yes”)
Do you want to pay more for health care and get less services (that would be a “no”)
Do you want free retirement (that would be a “yes”)
Do you want to live high on the hog and hand the bill to your grand-kids (that would be a “no”)
But the issue really is what do we do about financing spending? Yes we should cut the military, but of course the military is government spending if we cut it, it means layoffs it means reduced “stimulus”.
In the end a country must be productive it must grow and sell new products government spending is sometimes important, but it essentially is moving money from one place to another, it is not creating growth by itself. It may stimulate growth we can hope for that, but in the end it has to be the part of the economy that is creating and selling things, that is what creates jobs and wealth over the long haul .
Mervel, do you think World War II stimulated the American economy, and created wealth over the long haul? What about the building of the Interstate Highway System?
JDM writes “Do you want to live high on the hog and hand the bill to your grand-kids (that would be a “no”)”
What do you think the result of the Bush tax cuts will be on your grand-kids?
The real problem is that many people don’t pay any attention to the news, or don’t remember past news, or don’t really care (often because they are too busy trying to make ends meet), or all of the above, so even if they want to make a good decision about what is in their best interests they can’t.
Sometimes you go to the diner and hear people talk in paragraphs that are just a string of tired cliches woven into their own world view.
Walker: “What do you think the result of the Bush tax cuts will be on your grand-kids?”
Or the wars in Iraq and Afghanistan? Remember when we had a choice to treat the 9/11 attacks as a criminal act but we chose instead to make them a Crusade?
Flat Tax, no exceptions, no deductions ( except FCIA/MED) on all income, not just earned income. Those that pay into the FCIA/MED can deduct that the amount paid in from their total tax owed at the Federal Level. For lower wage earners it may result in a tax refund for higher wage earners it may encourage them to add more of their income as a salary to take advantage of the tax break, adding more funds into the safety net. Employers already get to deduct that Social security payment as an expense, why not wage earners?
khl: “Remember when we had a choice to treat the 9/11 attacks as a criminal act”
We don’t know what might have happened. We only do know that since 9/11 we have not had another successful terrorist attack.
“We only do know that since 9/11 we have not had another successful terrorist attack.”
Except for the anthrax attacks on the media. And except for Scott Roeder, on the abortion doctor. And except for James Van Brunn, who attacked the Holocaust Memorial.
But a lot of attacks have been stopped: http://www.splcenter.org/get-informed/publications/terror-from-the-right
Walker,
WWII had a stimulative impact on a severe depression in the US, however it also destroyed half the world which benefited those of us who were not destroyed, such as the US. The idea that war is somehow a positive thing for the economy is simply not true, war destroys and is one of the most destructive forces on the planet. Ask Germany or Italy or France how much WWII helped stimulate their economies which were left in rubble. We benefited greatly because we were essentially the only large economy able to produce things after the war.
The interstate Highway system was an investment in our infrastructure, our common capital and it had a positive impact on our economy. This is one area among others that government can and should be involved. I am not saying that government is not important to the economy it really is, without good government and governance, the economy can’t operate. My point is simply that in the end a nation succeeds economically based on how productive and creative and hardworking its citizens are able to be. Free markets and private enterprise in general have been the best place for this to happen operating in the confines of a good government system.
All of the government programs in the world to stimulate the economy won’t make any difference if you have an economy that is essentially unproductive. If you could stimulate your way to success then I think poor countries would just do that, just print money, just borrow money and stimulate their economies. Why wouldn’t Afghanistan just print a bunch of money and borrow a bunch of money and stimulate their way to growth, or Mexico or Mali or any other developing country?
“WWII had a stimulative impact on a severe depression in the US, however it also destroyed half the world which benefited those of us who were not destroyed, such as the US. ”
Germany was the most destroyed country in Europe. Now they are once a gain the top dog in the neighborhood! Go figure.
oa: “Except for the anthrax attacks on the media” ???
How many of the media died from that?
“Why wouldn’t Afghanistan just print a bunch of money and borrow a bunch of money and stimulate their way to growth, or Mexico or Mali or any other developing country?”
Because their inflation would go out of control. See Greece. In the U.S., not so much.
Mervel, I’m afraid Paul has it right. War may be bloody awful, but “the economy” doesn’t care– it’s just a measure of money spent, and after a war, it takes a bunch of spending to undo the mess (and besides, the dead don’t file unemployment claims).
I’m not advocating war. But this rampant “conservative” notion that government spending can’t have a positive effect on the economy is so utterly false that I will keep raising these examples until everyone’s totally sick of it. Just like I’m sick of “government is the problem” and “don’t tax the ‘job creators.'”
“Free markets and private enterprise in general have been the best place for this to happen operating in the confines of a good government system.”
Correction: Well regulated free markets are the best place for this to happen.
And well regulated markets are wholly dependent on complete and accurate information, something that is seriously lacking in many segments of our markets. Health care is a perfect example. Fracking comes to mind also– fracking companies are bribing legislators left and right to make sure that we don’t know what chemicals they’re planning to inject into our groundwater.
Ah, a thumbs down on each, but not a response in sight.
Well I don’t use the thumbs up or down thingy so its not me.
Government spending certainly has an impact on the economy, just as all spending does. The point I was simply making is that in the long run you can’t stimulate your way to economic prosperity. Government stimulus by its very nature is a one time shock to get things moving in the private sector as a whole.
In addition I totally agree that government has a role to play in any society and any economy. Very bad corrupt government’s or governments that don’t provide any public goods (things like police, fire, common defense, roads, bridges, public education) fail. But those things are not government stimulus, they are part of what governments are supposed to do.
On the other hand societies that have tried to make government the center of the economy also fail and have failed. We won the cold war for a reason, planned economies don’t work, communism the ultimate in government control and spending has been shown to be an utter failure.
“But this rampant “conservative” notion that government spending can’t have a positive effect on the economy is so utterly false that I will keep raising these examples until everyone’s totally sick of it”
There isn’t any shortage of this is there? You are getting a lot of what you want, you just seem to think that even more is the ticket. Since when do most conservatives support no government spending?
“we don’t know what chemicals they’re planning to inject into our groundwater”
Walker even you must realize that this is classic environmentalist wacko propaganda. They plan to “inject” chemicals into our groundwater?
Even those of us opposed to hydrolic fracturing that live on top of the Marcellus shale are not as hysterical as this comment.
We won the cold war because, instead of the soviets “burying us militarily” as Khrushchev hoped, we buried them economically thanks to American capitalism.
Sorry, Paul, you’re right, of course, no one is planning to inject chemicals into anyone’s ground water. But if you believe it never happens that fracking chemicals get into anyone’s drinking water, I’ve got a nice farm to sell you in Pennsylvania.
And you could say that we buried them economically thanks to American defense spending (fueled of course by American capitalism). Which raises the interesting question: would our economy have been robust enough to bury them without Eisenhower’s Interstate Highway System? And what if Eisenhower, instead of building interstates had cut taxes on the rich and eliminated the Glass Steagall Act?
Walker: “What do you think the result of the Bush tax cuts will be on your grand-kids?”
Since the current House and Senate don’t seem interested in cutting any spending, the only hope we-the-people have to reduce the $5Trillion in new Obama debt is to cut off their income supply.
“Since when do most conservatives support no government spending?”
Since Grover Norquist said “I don’t want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.”