Roll Call reports an embarrassing little legislative snafu in the Senate on Tuesday, in which a massive food-safety bill which includes tax hikes “violated a constitutional provision requiring that tax provisions originate in the House.” It would appear Senate Majority Leader Harry Reid has never actually read the Constitution during his thousand-year tenure. I wonder if the executives of Harrah’s Casino in Vegas would have ordered their employees to vote for him if they had known.
Roll Call characterizes this “debacle” as a “major embarrassment for Senate Democrats.” I have a more embarrassing question: what the hell are they doing, fooling around with a massive expansion of power for the Food and Drug Administration in the lame-duck session of Congress, when the government still doesn’t have a budget? Why are they trying to pass a bill salted with tax increases, when the expiration of the Bush tax cuts hangs over the economy like a headsman’s axe?
Although plenty of Republicans signed on to that food-safety bill, they now insist they will “block action on virtually all Democratic-backed legislation unrelated to tax cuts and government spending in the current post-election session of Congress,” according to an Associated Press report. As Senate Minority Leader Mitch McConnell told ABC News in an interview this morning, “One thing I think we all agreed on at the White House was that we ought to do first things first and what the American people want to know is are my taxes going up and how are you going to fund the government.”
President Obama has dispatched Treasury Secretary Tim Geithner and Budget Director Jacob Lew to negotiate with the Republicans on extending the Bush tax cuts. This is an encouraging step, because Tim Geithner knows a lot about avoiding taxes.
Everyone in the political class is now wringing their hands about “gridlock,” both in the post-election session and the next full Congress. “The American people did not vote for gridlock,” intoned the President after a Tuesday meeting with congressional leaders. “They did not vote for unyielding partisanship. They’re demanding cooperation, and they’re demanding progress, and they’ll hold all of us – and I mean all of us – accountable.”
You know what else the American people didn’t vote for? Reaching a “compromise” with Obama’s titanic expansion of an already bloated federal government. Federal spending was about 18% of our national Gross Domestic Product when George Bush took office in 2000, and rose to 20.65% by 2008. That’s bad… but under two years of Obama, it has surged to 25.44% of GDP. That’s right – federal spending now constitutes over a quarter of our national economy. Bargaining it down to an even 25% would be no victory. If a thief steals your wallet, but you talk him into letting you keep bus fare for a ride home, you haven’t made “progress” through a grand “compromise.”
During the 2008 elections, conservatives would occasionally say they were so underwhelmed by McCain that it was better to stay home, and wait for 2012 to get a better candidate. I maintained they were underestimating how much damage Obama would do, and how quickly he would do it. If conservatives don’t score the most astonishing political victories in history over the next few elections, and their representatives don’t act with historic courage and conviction, it will be the work of generations to reverse what Barack Obama has done in only two years.
Keeping the Bush tax rates in place is proving to be a savage political battle that may yet end in a “compromise” that betrays some expendable population of high income earners. Scaling back federal spending to 2008 levels would be the greatest political achievement in a century for conservatives… and that’s not nearly good enough to address our looming fiscal catastrophe.
There is no room for “compromise” with what the Left wants to do. The closest thing to an “idea” bubbling out of the Democrat Party is raising taxes and throwing more money away on “stimulus” spending, since it has become an article of religious faith that the last trillion dollars of federal pork just wasn’t enough.
Writing in the Wall Street Journal today, Stanford University economics professor Michael J. Boskin declares, “economic theory, history and statistical studies reveal that more taxes and spending are more likely to harm than help the economy. Those who demand spending control and oppose tax hikes hold the intellectual high ground.” As Boskin explains, small tax rebates and temporary tax cuts have little beneficial effect, because the people who generate serious economic stimulus and create jobs are more likely to save the money than invest it. The threat of future tax increases has more bearing on their behavior that a little one-time rebate check from Uncle Sam.
“Stimulus” spending is no more useful. Boskin reports the work of colleagues who determined the massive $814 billion stimulus of February 2009 resulted in a “puny” 0.2% of GDP growth. Economic growth is determined by the combined intelligence of individuals making free choices, not the crude slap of greenbacks into outstretched hands. Every dollar the government taxes and spends is a dollar that was forced somewhere it didn’t want to go. When that kind of force is leveraged to do more than pay the necessary expenses of a lean and efficient government, the decline of national wealth is inevitable… especially since the acolytes of the total State can imagine no other solution to their failures than redoubling their efforts.
Professor Boskin says that even Obama’s advisors estimate $1 of tax cuts produces $3 of short-term economic growth, while his colleagues say the true value is more like $5. Meanwhile, $1 of deficit spending costs the economy an average of $3.40. Where is the “compromise” between those extremes?
Voters didn’t send a tidal wave of new Republicans to Congress in order to make deals with the President and party that have dragged their nation to the edge of ruin. The philosophy that carried us to the edge of a deficit pit, filled with the poisoned spikes of Social Security and Medicare insolvency, is wholly incompatible with the ideas that can save us.