Hold it justaminnit. Pay down the debt? Fiscal responsibility?
If I’m not mistaken, that is exactly what Bush’s plan is designed to achieve. He wants to pay down $2 trillion of the national debt over ten years and promises to increase discretionary spending by only 4% per year while enacting a tax cut. Let’s compare this with the "fiscal responsibility of Mr. Clinton’s budgets.
Over the last four years Bill’s budgets increased discretionary spending by 6% for each of the first three and a whopping 8 and one-half percent last year. Where’s the responsibility there? I can’t find it.
Mr. Clinton’s 2001 budget proposed to pay down $237 billion of the federal debt. He also paid down a mere $363 billion over the previous three years. This is only $600 billion total, or $150 billion per year. Dubya’s plan averages $200 billion per year.
So Clinton spent more of your money and paid less on the debt than the Bush plan. On top of all that Bush wants to give us a tax break, too? I think it’s obvious which of these plans is the more fiscally responsible one. Stoid, I have no idea what this thread has to do with Marc Rich, but how 'bout instead of pardoning him, we confiscate enough of his assets to pay his damned tax bill and then put that towards the debt? That seems to make more sense to me than giving the “fatcat asshole” a free ride.
Well, to the best of my knowledge, that’s what we’re doing. One of the effects of the pardon is that he can come back to American soil, and be audited for all his back taxes.
Oh, come on Uncle Beer, this is the sort of ridiculous math that means nothing. The budget has just been coming into surplus over the last few years. If you don’t remember, Clinton inherited big deficits and turned them into surplusses. Even by your own math, the amount that Clinton’s 2001 budget plans to pay toward the debt is more than what Dubya’s averages over the next 10 years. And, the trend has been for increasing surplusses each year.
The really dangerous thing about Dubya’s plan too is that the tax cuts are phased in over the next 10 years, so when we hear about a $1.6 trillion (apparently more like $2.2 trillion) tax cut over 10 years, it doesn’t mean the revenue loss is like $220 billion per year after that time…Once the cuts are fully phased in, it is considerably more.
From what I understand, this supposed money that is going to be used to pay the debt is an estimate of what is to come in the future. Lemme look up the editorial I read in the Pittsburgh Post Gazette this morning…it might have been from the Washington Post, though…
Ah, I have the paper in front of me right now…I’ll TRY and find an online source:
“Reel in Bush’s Bodacious Tax Cut” by David S. Broder
I don’t want to quote it, because I don’t want to get in trouble with copyrights, but the gist of it is that Bush is putting the cart before the horse. Instead of waiting to see where the economy will go in the near future, Bush’s plans make assumptions that it’s going to skyrocket.
Ah, here we go: http://www.washingtonpost.com/wp-dyn/articles/A11667-2001Mar1.html
Why not go half way? Give a smaller tax cut now, try paying down the debt, and THEN seeing where we’re at. Isn’t that the responsible way to do it?
Like it or not, taxes are a necessary evil.
This is just hilarious. Now that the Democrats are seeing their candy store being taken away, suddenly they are the champions of fiscal responsibility, and want to ‘wait and see’ over the tax cut, or they want triggers put in so they can cancel it if the surpluses don’t emerge (say, because they increase spending so that there isn’t one).
Where were the Democrats for the last 30 years on this issue? The fact is, spending is ALWAYS based on multi-year projections. When the Democrats introduce some major new spending program, how come they never advocate triggers to scale it back if the economic projections are wrong? I’ve NEVER heard a Democrat advocate spending triggers, yet suddenly you need a trigger on the tax cuts?
The fact is, if Bush’s tax cuts are cut by $800 billion, the Congress will find a way to spend it. Then the money will be gone.
Think of the Federal government like an idiot with a maxxed-out credit card. By giving the surplus back to the people, Bush is effectively cutting up the credit card. Of course Democrats are going to fight this with every fibre in their being - Bush is hitting them where it hurts.
All this nonsense about the danger of projections and the need for triggers is just a smokescreen. Of course taxes can always be raised later if the need arises, with or without a trigger. However, the Democrats don’t want to be seen as tax-and-spend liberals, so they’d rather make those increases automatic, rather than have to take their case to the public say, six years from now.
Bush is smart enough to see through this. He correctly pointed out the other day that there are only two scenarios under which you might want to raise taxes again: If the surplus doesn’t materialize, or if the government spends too much. He went on to point out that if the economy is weak, the last thing you want to do is increase taxes. And if you don’t want government spending to go up, the best way to ensure that is to not give the big spenders an easy ‘out’ in the form of an automatic tax increase if they spend too much.
Sorry to jump in so late, but I just wanted to make two points:
A) We’re talking about a 10 year span here. When you do the figures using all the tiers (not just the reduction in your personal bracket), there are substantial savings over 10 years. Certainly, a lot of households will save more than $24K and many will even save more than $80K (I know mine will).
B) There are thought-provoking arguments against removing all public debt. If all debt were eliminated, and the gov’t still had a surplus, and we were no longer in a recession, they would be forced to either cut taxes during a boom (generally considered bad fiscal policy) or start acquiring private property/investments (generally considered bad policy altogether) or increase spending to use the money (a REALLY bad idea). Of course there are arguments against those arguments which suggest that shortly after we finish paying the debt, we’ll need the surplus to pay SS benefits to baby boomers so we shouldn’t get tax-cut-happy now.
My point is that there are intelligent arguments on both sides. Some (most?) people may be focusing on the money or votes they’ll get, but there’s also plenty of critical thinking going on. It’s just not a very easy call, even for seasoned economists.
Let me suggest that the common statements in this thread that all spending is due only to Democrats’ greed and lust for spending on anything, everything, whatever they can think of, and that all such money is effectively destroyed, while Republicans’ spending programs are always sober and responsible investments in our nation’s future, is too cartoonish to be taken seriously. So, likewise, is the claim that all government spending during the last 8 years is attributable to the President, while during the previous 12 years it was all Congress’ fault. You’re not kidding anyone but yourselves.
Sure there is another option: Bush is paying down the debt at the fastest rate possible without incurring penalties. See, the debt is spread around in instruments of varying terms. If you buy them back before they mature you pay a penalty. So Bush’s plan buys back EVERY debt instrument that matures over the next ten years. This sounds pretty damned reasonable to me, and I’m a hawk when it comes to government debt.
But now that all you Democrats have discovered fiscal responsibility, I assume that you’ll all be fighting to have triggers on any new entitlement that the Democrats propose? Let’s say a bill comes along that entitles seniors to free prescription drug coverage. I assume that you’ll fight to have a trigger put in place that removes that entitlement if the economy tanks?
The dirty secret here is that new spending programs are MUCH more dangerous than are tax cuts, because it’s a lot easier to raise taxes again if you need to than it is to cut an entitlement program.
The other hypocritical thing here that just amazes me is that the Democrats claim that Bush’s tax cut is dangerous, but what is their proposal? Are they planning on putting that money under a mattress for a rainy day? No, they plan to SPEND it. The Democratic tax cut proposal takes Bush’s 1.6 trillion tax cut and splits it down the middle, earmarking 1/2 for tax cuts and 1/2 for NEW spending programs. Just how is that any more fiscally responsible? And I’ll repeat: The Democrats do NOT want triggers put on their new 800 billion in spending programs.
I can’t comment on cutting taxes, but why would private investment and increased spending (public investment) be considered bad ideas in an economic boom? To me, they sound like good policies.
I don’t believe that. Does anyone have any figures on how much of each debt instrument comprises the national debt, and when they mature? I tried searching the web once, but could only find the aggregate debt figure.
And what would be wrong with investing extra money specially earmarked for paying off the debt as it matures?
It seems like it’s all just a pissing contest; “We’re screwing up less than the Democrats would.” In my opinion, neither political party makes much fiscal sense. Republicans ignore problems, then when they get worse, they still ignore them. Democrats ignore problems, then when they get worse, they throw money at it. Both parties only seem to look at the short-term solutions instead of long-term fixes.
A) Wide-spread and long-term government investment in private enterprise compromises the impartiality of our legislative (and judicial/executive?) branches. For example, if trillions of dollars of social security funds are tied up in the markets with heavy stakes in companies like Microsoft, and congressmen know that passing a particular law will crash Microsoft’s stock, leaving them with a multi-billion dollar shortfall, will that affect their vote?
B) On a similar note, how should the government choose its investments? If it invests in large, established companies, it endangers free market competition. If it invests in small, volatile companies, it risks losing public funds. Private investment by the gov’t only works when its purpose is not investment (i.e. niche programs to provide loans to entrepreneurs, etc.) and there’s no expectation or requirement of ROI.
C) During a boom, tax revenues are at their highest. If new programs are added to use that money, it is unlikely that future revenues will be able to sustain them during an economic downturn, which leads either to deficit spending, or massive spending cuts during periods of recession (i.e. the economy’s slowing down, so let’s lay off a bunch of NASA workers or cut back on welfare benefits, etc.) which may exacerbate the problem.