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Thursday, March 17, 2011

It's Not About the Deficit

Kevin Drum:

Who's Being Serious Here?, by Kevin Drum: Paul Ryan has taken to asking if President Obama is "an Erskine Bowles Democrat or a Nancy Pelosi Democrat?" Well, if this is the best that Bowles can do, I guess it makes Obama's choice a lot easier:

....Mr. Bowles had harsh words for fellow Democrats. He dismissed the idea that raising taxes alone might help erase the deficit, saying "raising taxes doesn't do a dern thing" to address health care costs that are projected to be a big driver of future fiscal problems.

If there's anything that could be called a wonkish consensus on the left, it's this: we should eliminate the Bush tax cuts in a couple of years when the economy has recovered, and we need to rein in the long-term growth of healthcare costs. It's true that taxes don't address healthcare costs, but it's just sophistry on Bowles' part to put it like that. Taxes do address the medium-term deficit, and that's important. Quite separately, PPACA makes a start on holding down healthcare costs and thus addressing the long-term deficit, and I hardly know anyone on the left who doesn't agree that more needs to be done.

...Jon Chait has more on this, including a more detailed takedown of Bowles' own proposals for healthcare, which are almost laughably inadequate.

I think we make a mistake by talking about this as though the goal of Republicans is actually deficit reduction. It's not, the goal is a reduction in the size of government and once you understand that, it's clear why Republicans will not support tax increases of any kind. They'd rather cut taxes now (and argue it's about jobs or long-run growth rather than ideology), and increase the deficit even more because they still believe the beast can be starved. Anything that increases the pressure to reduce spending will be embraced, anything such as a tax increase that might allow the government to grow larger will be opposed. Logic about the best way to close the deficit won't win this argument because it has little to do with the deficit itself.

    Posted by on Thursday, March 17, 2011 at 10:26 AM in Budget Deficit, Economics, Politics, Taxes | Permalink  Comments (54)


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