"Starving the Beast"

Read this, Stating the Obvious from Krugman today.

It’s no secret that right-wing ideologues want to abolish programs Americans take for granted. But not long ago, to suggest that the Bush administration’s policies might actually be driven by those ideologues — that the administration was deliberately setting the country up for a fiscal crisis in which popular social programs could be sharply cut — was to be accused of spouting conspiracy theories.

Then read this, Taxing Credibility by Bruce Bartlett from the LA Times Sunday, arguing from the right that yes this is exactly what they are doing, and for good reason.

Neoconservatives thought that attacking massively popular spending programs was both counterproductive and politically hopeless. Congress would never vote to cut such programs directly, and would not even restrain their growth unless under enormous political pressure.

And so, they approached things differently. First, they concluded that it is the relative size of government, not its absolute size, that is most important. In other words, government spending as a share of the gross domestic product was what mattered. For neocons, increasing the GDP is as important as lowering spending. Earlier conservatives had concentrated almost exclusively on controlling spending, assuming that increasing GDP was beyond government’s grasp.

Second, neoconservatives absorbed the insights of Public Choice, an economic school led by Nobel Prize winner James Buchanan. One of Buchanan’s theories, developed in academic papers and books during the mid-1970s, held that the size of government is better controlled on the tax side than the spending side. Cutting spending directly, while desirable, was often impossible in the absence of special circumstances, because the beneficiaries of spending were well organized and motivated, while those favoring lower spending were disorganized and diffused.

Neoconservatives saw tax cuts as a single solution to both problems. Lower tax rates would spur economic growth. If growth increased faster than spending, then spending’s share of GDP would fall without the necessity of cutting spending directly. At the same time, they reasoned, budget deficits resulting from lower taxes would mobilize movements advocating reduced spending.

When California’s Proposition 13 came along in 1978, Kristol saw another way in which tax cutting was useful. By denying government its fuel, tax cuts forced politicians to cut spending. In this sense, supply-side economics echoed the thinking of conservative economist Milton Friedman, who wrote in a 1978 column that “the only effective way to restrain government spending is by limiting government’s explicit tax revenue — just as a limited income is the only effective restraint on any individual’s or family’s spending.”

Starving the beast and increasing incentives for work, saving and investment are still good reasons to cut taxes today.

Yes, it’s obvious, especially when they clearly say that their intent is to bankrupt the country IN ORDER TO get rid of Social Security and Medicare They call it “starving the beast” and they are proud to be bankrupting the country, because that brings the desired goal of getting rid of all of our pensions and health care.

If you asked the average Bush voter if they think Bush is trying to get rid of Social Security or Medicare they’ll look at you like you are a crazy conspiracist. But how do you get through to them, when all of AM radio is a 24/7 Republican party ad, the TV networks replace Phil Donahue with Michael Savage, and most people won’t go near a newspaper? Well, I’ve been writing about how to do that.

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