What's All This Then?

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Wednesday, April 13, 2011

What a lovely reversal of the ancient plaint that would be - and there are voters in this country who actually believe it possible. Why else would they vote to elect those Republican members of Congress who threatened to shut down the United States government unless the President and the Senate agreed to cut spending for those who need it the most and cut taxes (again) for those who need it least? Listening to Paul Ryan propose that we return to the economics and the mores of 1900 in order to make a dent in our 1.5 trillion deficit and then reading and hearing him being referred to as a "leader" and "courageous" boggles the mind.

I won’t bother to try to estimate or predict the effect of his proposals if, by some miracle they could become law. We’ve all read and heard the reactions from the left and the right - and from neutral analysis that concludes that they would plunge us further in debt. I just want to comment on the mindset of Republicans as they approach the problem of how we can live "within our means" - a term that the President used today in presenting his ideas of how to chip away at our trillions of debt.

My first observation is that the United States is not like a "family" - that social group often used by critics of government spending as an example of how a nation should conduct itself. "A family has to live within its means" they say." So should the government." They rarely if ever say the "nation." It’s always the "government" - the body that, as Ronald Reagan once observed, is "the problem." And that wasn’t a line in a movie. It was in his first inaugural address. And Republicans have been echoing that sentiment ever since - while clawing to become part of that evil being and, when controlling it, spending like a drunken sailor. I don’t recall cries of the sky falling during the eight years of the G.W. Bush presidency - but now, suddenly, the Republican observatory has been able to confirm that indeed earth and sky have become closer to each other and the only remedy is to assure that the 3% of service devoted to abortion offered by Planned Parenthood be stripped of its annual government stipend. I joke of course but I’ll try to be serious.

I agree with much of what the President said today - particularly his defense of Medicare, Medicaid and Social Security. He seemed to be drawing a proverbial line in the sand. And I was glad to hear him mention words that Republicans try to eliminate from the nation’s vocabulary. Taxes. Taxes that should be paid by the rich. Of course when you are considering the nation’s finances, you must look at expenditures and revenues . You can’t balance budgets by tackling only one of them - unless of course you’d be happy with a society of the very, very rich - and the poor - the very, very poor with nobody in between. No middle class. So let me suggest the way it should be done in a rational world - but won’t because the irrationality of politics interferes. Nonetheless, here goes.

You begin with deciding the basic services that government should provide to the people. That includes such things as Medicare, Medicaid and Social Security and many of the other things the President mentioned, including the military - though a much reduced military. You go through all of the existing expenditures and retain those programs and benefits that you deem beneficial and necessary and eliminate or curtail those that are not. Then you tot up the cost of everything that the government will be paying for and you begin the task of assuring that costs will be balanced by revenues. Our problem seems to be that we do things the other way round. For Medicare and Social Security, we devise taxes to pay for them - but when, after a few years the taxes seem to be less than what is needed, we throw up our hands and say the sky is falling. We devise tax codes not necessarily designed to take care of all the nation’s needs. We throw in a couple of wars and reductions in taxes - and suddenly we’re spending more than we’re taking in. Republicans then say that we have a "spending" problem and we need to cut the spending. We have to live within our means - just a like a family must. But a nation is not like a family. A family can’t increase its revenues to meet expenditures it has laid out for itself. A family can use credit cards and maybe family members can get a second or third job - but ultimately it has to make the decision to do without certain things that it hasn’t the money to pay for. A nation has the option of acquiring as much money as it needs to pay for the services it deems necessary to provide. It’s called an increase in taxes.

No one enjoys paying taxes - even the disgustingly rich who wouldn’t miss any tax that they’re asked to pay. But when a nation is in debt, it is sheer madness to believe that you can get out of debt by cutting programs that are of value to most people other than the rich while at the same time cutting taxes that the rich have to pay. It’s downright crazy. We pay less in taxes than most other industrialized countries - and while we once were taxed at a higher rate -a marginal rate as high as 90% in the 1950’s, our current limit of 35% just isn’t providing the revenue we need. I’m not suggesting that we should return to the rates we paid under Eisenhower and Nixon - only that we should do what is necessary to balance our budget - and that includes such things as raising the income limit for FICA payments - getting wealthy corporations to pay their fair share and cutting such things as farm and oil company subsidies - and raising income taxes. We simply have to stop saying such things as a tax increase for those earning above a certain amount is a "non starter" as Speaker Boehner has been saying. Look at the title of this piece. It isn’t possible.

It was a good speech. I hope the follow through is just as good.