Politics
A few days ago Peter Wehner said that he is worried about what he calls The GOP's Philosophical Straitjacket, namely the belief that tax hikes are always bad. In particular, he highlights an incident in the most recent GOP debate:
"I'm going to ask a question to everyone here on the stage," Baier said. "Say you had a deal, a real spending cuts deal, 10-to-1, as Byron said, spending cuts to tax increases.... Who on this stage would walk away from that deal? Can you raise your hand if you feel so strongly about not raising taxes, you'd walk away on the 10-to-1 deal?"
All eight candidates raised their hand
And he comments, "Now on one level I understand this response. Republicans should not negotiate with themselves, and a willingness to reveal one's demands in advance can weaken one's position down the road," be he continues:
Are Republicans in 2011 saying that a deal that would be far better than one Reagan expected and agreed to is simply beyond the pale?
If so -- if taxes cannot be raised under any circumstance -- then we have veered from economic policy to religious catechism.
It is interesting that Wehner has moved from something "philosophical" to a "catechism" in a few paragraphs. And today, in response to Charles Murray's claim that the position is reasonable because "there is no such thing as a real spending cuts deal," Wehner notes that the question was a hypothetical one, in which there were real cuts. Fair enough.
But I would like to consider how this became a GOP catechism. It seems to me that much of the blame might go to George W. Bush. President Bush, perhaps because of his philosophical views (that federal policy ought to show "compassion"), and perhaps because the GOP had such small majorities (when they had majorities in Congress), that tax cuts were the only policy upon which there was GOP consensus, (and the small majorities made porkbarrelling more important) made tax cuts more of a fixed idea than they had been before his presidency. To be sure, when his father broke his "no new taxes" pledge, it was a big deal. Perhaps my reading of history is wrong, but the importance of not raising taxes as a fixed point seems to have taken on increasing importance in the last decade.
President Bush, who gave us the prescription drug benefit, "No Child Left Behind" (the latter written by Ted Kennedy's staff, if memory serves), and legions of porkbarrelling, (let's not forget that Porkbusters began ni 2005), not to mention, a great deal of expesive regulation, could appeal to small government types only by promoting tax cuts.
Historically speaking, the conservative Republican coalition had three legs: foreign policy, economic policy, and social policy. By giving such short shrift to the libertarian/ classical wing, Bush may have reduced the "conservative" position to tax cuts, and nothing but tax cuts.
It might be that if we can make genuine cuts in the size and scope of government, there will be more room for a discussion of whether certain tax hikes might be a worthy price to pay for such a deal. It might also be that only such a deal would justify GOP support for tax increases. The trouble is, having learned to equate tax cuts with limited government, we must relearn that a tax cuts are but one means to a larger end.
The problem lies between the hypothetical and reality.
Use the recent CR for FY 2011 as an example. After much discussion, it was disclosed that there would be $6 billion in spending cuts, but after the fact, the number was revised to $0.24 billion of actual "spending cuts" because of "accounting tricks."
Republicans have had the proverbial "football" pulled away by "Charlie Brown's Lucy" too many times to start by putting "raising taxes" on the table.
If, and that is a big IF, Congress could actually do a 10-1 ratio, and stay with in the means of the country to pay for all this, then great, raise taxes.
Unfortunately, with Congress's track record of increased spending, increased regulations, increased indebtedness, increased complexity of tax codes resulting in hidden tax breaks, a candidate probably must toe the no tax line.
I can see the 10 to 1 ratio rapidly becoming a 1 to 10 ratio with in one election cycle.
Conservatives need to start calling for this:
Removal of all taxes completely. Including excise fees etc.
Removal of all deductions. No tax breaks.
A flat tax for all people of a fix %. % does not increase with income, only the amount paid. A simple tax that a child could figure out.
OF course it will never happen. Critics cry regressive. There would be no pay backs for campaign funds.
And no jobs for all those who work to work the system, because the system would be gone.
Imagine this, every year you would receive a bill (no more tax withholding, you can save to pay your bill) and you write a check or swipe your card. No forms, the % is known.
Plum pig-headedness on the subject of taxation was not a consequence of the younger Mr. Bush's policy errors. It has been an element of the culture of the Republican Party for 25 years or more. Ronald Reagan taught himself and then taught the Republican Party self-deception on fiscal policy. It is a set of lessons best unlearned.
"Ronald Reagan taught himself and then taught the Republican Party self-deception on fiscal policy. It is a set of lessons best unlearned."
No Reagan simply fumbled around discovering the possibilities of Fiat money, it is not a set of lessons best unlearned, because there is just not enough relevant understanding of what 1971 means for fiscal policy.
The self-deception is that fiscal policy will ever be the same, or that any lessons learned prior to 1971 are even relevant.
If you wanted to you could get rid of the legal barriers, i.e. the debt ceilling, and the requirement that the treasury sell bonds, and essentially the fed and the government could run a deficit without issueing debt.
We don't actually need China or Japan to buy our debt, and there is never again an independent reason why tax revenues should equal receipts. The only reason to support tax increases is to fight inflation by drainning money from the system.
Taxes are simply not necessary to fund the federal gov. We should howhever say that we will raise taxes and cut spending when the inflation rate climbs above the unemployment rate. (that is a simple bright line rule).