Ad hominemania
In 2000, Chicago’s Business School hosted a talk by Larry Summers, who was then the Treasury Secretary, and advising Al Gore's campaign. At the time, Gore was offering tax deductions or credits for practically anything one might do, from getting born to entering a nursing home. These sorts of tiny lump-sum deductions are generally frowned on by economists; they distort activity, are costly to administer, and unlike marginal rate cuts, provide no positive incentives to increase work.
"Mr Secretary," one of my professors asked him, "You know the theory as well as I do. You believe the theory. Why are you supporting these tax deductions?"
"Because that's the only way we have in this environment to get help to people who need it," said Larry Summers. " There are things more important than economic efficiency." It was a stunning moment: the first, and sadly the last, time I have heard a policymaker admit that he supported something for moral reasons even though it might not make the economy grow faster.The specter of that moment haunted me throughout my reading of The Big Con.
Larry Summers' answer was a grown up answer to a grown up question. It acknowledged that there are oftentimes trade-offs between economic efficiency and otherwise desirable outcomes. It bowed to the reality that sometimes, politicians have to enact laws that are less than ideal, if they want to do anything at all. It did not insult the intelligence of its audience by telling them that they could have their cake and eat it, too. It conceded that its author was making a value judgement that the audience might not share. His answer made me think that I would vote, if not for Al Gore, than for Larry Summers.
To be fair, it was hardly as if Larry Summers could obfuscate in that particular situation; had he tried to obscure the choices he was making, he would not have succeeded in fooling anyone, but only in making himself ridiculous. Nonetheless, he quite spoiled me for future stump speeches in which politicians promise their constituents that they can have everything they want, and a pony too, all at absolutely no cost to anyone except perhaps a few far-off rich predators or welfare queens who don't deserve their money anyway.
If only every audience could be filled with economists who know the score. But of course, most aren't. And so we get the spectacle of Republican candidates claiming on the stump that cutting tax rates increases tax revenue.
What is a journalist to do when confronted with these sorts of ridiculous claims? When the journalist is Jonathan Chait, and the claims are that tax cuts are the solution to every problem that ails the economy, the answer is "write a book". And in the parts that are confined to that mission, or to an interesting, if highly incomplete, history of the supply-side movement, I was happy to be Mr Chait's fellow traveler. It cannot be said often enough that tax cuts, at least in the narrow range of marginal rates in which American tax policy seems to be stuck, do not "pay for themselves" by increasing the revenue that the government collects.
But overall, I was disappointed with the thrust of the book. Mr Chait has cast himself as one undertaking to solve a mystery: why Republican politicians push for tax cuts using shady rationales, when no one except a tiny handful of their richest donors supports the tax cuts. Of course, if you systematically throw out any evidence that contradicts these assumptions, you are practically forced to Mr Chait's conclusion, which is that a supply-side cult funded by fantastically wealthy donors has hijacked American politics to its own nefarious ends.
But there are other potential explanations for the alleged disconnect between the will of the people and the actual government we get. And those explanations do not require positing, as do Mr Chait's, that Republicans are somehow uniquely corrupt, partison, ideologically blinkered, and, of course, stupid.
My view of American politics over the last 25 years is that Democrats and Republicans have been conducting a proxy war over the federal government's share of the economy. Liberals would like it to be bigger, for sincere and honest reasons. Republicans would like it to be smaller, also for sincere and honest reasons. But that argument is ugly and fraught. If you try to cut any subsidy, no matter how outrageous, the recipients get angry and vote against you, while the other voters yawn in disinterest; that is why, nearly twenty years after it was penned, P.J. O'Rourke's scathing indictment of US farm subsidies (excerpt here) reads as if it had just gone to press last week.
However, people also aren't really all that fond of new spending. They say they are in favor of it, of course, at least as long as that spending is funded by taxes on someone else. New spending funded by tax increases on the rich often polls quite well. (Of course, it also sometimes doesn't poll so well, which is why it's best to be wary of pundits bearing polls.) Polls are extremely easy to bias, even without meaning to; they are extraordinarily sensitive to the way the question is framed. So, for example, majorities of Americans support keeping Roe, and also support restricting abortion to cases of incest, rape, and the life of the mother. It is obviously not logically possible to reconcile those two beliefs.
The explanation for the fact that public policy diverges from polls, then, may be (I think, is) that polls are at best a crude measure for determining what the public favors. Especially because polls about spending proposals are necessarily vague. "Senator Smith wants to raise taxes on the rich in order to support education in this country. Would you be in favor of this?" Why, yes, I certainly would! But then the details come out, and it turns out that my district won't be eligible; most of the money will go to schools in other states, filled with people who voted against my candidate in the last election. Also, the tax increases turn out to be quite steep. And the textbooks they'll be using are filled with outrageous propaganda for a political view I don't support. Senator Smith, this is Sally Johnson from Centerville, and I want to tell you that if you support this un-American policy, you'll never get my vote again!
That's why the bulk of new spending over the last twenty-five years seems to be concentrated in one place: the elderly. It's the only group we all identify with, at least prospectively.
The American public seems to prefer spending and tax revenue stuck around 18-20% of GDP. That frustrates Democrats who want to grow that share, and Republicans who want to shrink it; but it's been remarkably stable for the last 40 years or so.
Is it any surprise that having been stymied by the public from doing anything but play around the margins of spending, Democrats and Republicans have invested totemic powers in marginal tax rates, where they have slightly more leeway? Republicans fetishize Reagan's tax cuts, crediting them with any growth at all that occurred during the 1980's--having hit my full 6'2 around 1984, I occasionally fear that I will show up as an exhibit in a supply-side memo.
Democrats, meanwhile, invest a ferocious amount of energy in denouncing even cuts which cost a relatively small amount of revenue, such as the capital gains and dividends tax cuts, the repeal of which would raise perhaps 0.1% of GDP, or about 6.5% of this year's projected budget deficit. Politicians and pundits profess the rather silly belief that if we restored the tax levels of 2000, we'd approach something like its level of economic growth too.
This not to take a "pox on both their houses" approach so much as to point out that the whole country is investing a disproportionate amount of energy in taxation as an issue. Changing the level of capital gains and dividend taxation would not visibly alter the income distribution, budget deficit, or any other goal that Democrats are looking to advance; it's simply too small a matter to make much difference. Yet because over half the cut went to the rich, this is often Exhibit A in the diatribes against the Bush tax cuts.
I could speculate that this is because Democrats don't really care about anything except class warfare . . . but there's no need to put the least charitable gloss on it, particularly when a less inflammatory reading has better explanatory power. I read both groups as taking a second-best approach to what they're really after. Yes, there are some Republicans who would like to cut taxes just because they want the money, just as there are undoubtedly some Democrats, somewhere, who would like to raise taxes on the rich even if we can't spend the money on anything worthwhile, just to cut down the tall poppies. But mostly the policy approach is: change the tax rate, and then use the resulting changes in revenue to change the level of spending.
As Ross points out, the reality has generally not matched the hopes or the hype. "Starve the beast" has worked about as well for the Republican Party as it did for me when I tried to put my bullmastiff on a diet. And the Clinton tax increases didn't buy the Democrats any of the new spending programs they wanted; mostly, they bought farm subsidies, transportation bills, and bonds from rich people who had been holding our national debt. The current crop of Democratic candidates is carefully avoiding deficit promises in order to preserve their options on spending--but I predict that they, too, will find any big new program not specifically directed at the elderly prohibitively difficult to pass, even with control of Congress.
This could also explain the explosion in lobbying and corruption scandals over the last 20 years; left without the power to make much policy, legislators have sold favors instead.
I prefer my explanation because it doesn't rely on believing that thirty years ago the Republicans, suddenly and for no apparent reason, become eviler, while simultaneously--luckily for them!--the American public, suddenly and for no apparent reason, became stupider. So stupid, in fact, that they couldn't find the lever to vote for the people they actually agreed with.
Happily, my explanation also does not require that I insult the intelligence of my opponents.
There's an inaccuracy in your wording there. They didn't buy many Democratic liberals, and big pork producer GOP (one example of the latter: the complaint Clinton was "eviscerating" the military,) the programs they wanted.
That's because his carefully chosen rates were meant to be a tool with which to balance the budget and work on the deficit without putting a damper on the economy, in a process that was eventually supposed to make further programs affordable in the future. It was the economy stupid, as in: fix the economy first.
The tax rates, however, were not presented as being the only cure needed, they weren't the only tool. Another was the president spending long hours riding herd on Congress to make deals on cutting pork, and even digging in his heels and shutting done the government (so that, um, certain interns happened to be distributing pizza in the White House). There was also the micromanagement of trade and related world economy issues with Rubin. (What was the phrase Tom Friedman used early on? Something about how the Bushies were not showing the "infinite care" that the Clinton team took with the economy?)
That's the way I remember it.
I also remember polls showing ovewhelming support by the public for these policies, including at all income levels (I was one of those people), with no kvetching from upper income because the top income tax rate and cap gains, etc. were still quite modest.
September 11, 2007 5:42 PM | Reply | Permalink
McArdle is guilty of exactly what she accuses Chait of, only with respect to the people on her own side.
She assumes that her fellow conservatives are all Grover Norquist "drown it in the bathtub" types. Why? I doubt, for example, that Jack Kemp wants to drown it in the bathtub. I think Kemp thinks that tax cuts are good because they stimulate the economy. Plenty of honest Republicans think such things and aren't interested in shrinking the size of government.
And just as there are plenty of honest Republicans who want to use tax cuts to stimulate growth, there are also dishonest Republicans who don't have any belief either in the magical economic power of tax cuts or shrinking the size of goverment. Indeed, many of these types supported the President's mammoth expansions in the size of government, including the prescription drug bill. But they know that tax cuts pay off key Republican constituencies and fananciers. Why should McArdle be able to make a sweeping generalization that neither these folks nor the Jack Kemp wing of the party really exist and everyone's just using tax cuts as a proxy for shrinking government? Especially since you could shrink government (if tax cuts really shrunk government) just as easily with payroll tax cuts, or middle class tax cuts, but it always seems like the taxes that Republicans want to cut are those that fall on the rich, including upper income brackets, capital gains taxes, and estate taxes? The evidence would seem to fit Chait's thesis, not McArdle's.
The other problem with McArdle is that although I take her point that there is plenty of dishonest rhetoric on all sides of the political spectrum, where's the evidence that liberals do anything remotely as dishonest as the supply-side scam, which includes ENFORCING the dishonesty with primary challenges and requiring conservative publications like National Review and the Weekly Standard to march in lockstep?
September 11, 2007 6:16 PM | Reply | Permalink
Interesting post. I've noticed you use the tall poppies analogy before. Let me reassure you I love poppies and am happy to let them grow how they want. It is greedy kudzu that I want to cut back.
September 11, 2007 8:28 PM | Reply | Permalink
Obviously Chait isn't arguing that most Republicans believe themselves to be evil people who are lying about their real goals. Very few people are like that; we almost all believe ourselves to be noble and honest people who use sometimes exaggerated rhetoric to present the world in a fashion that best complements our understanding of it. But while Republicans and Democrats both slant the truth in the service of their political interests, it is rare that one encounters a case where the truth has been not just slanted but inverted, twirled around, cracked in half and tossed in the dumpster the way it has been with the Republican embrace of supply-side claims over tax cuts and revenue. When people are willing to argue that 2 + 2 = 5, year after year, with ever-increasing conviction, and in a fashion that hands very rich people enormous amounts of money, at the expense of funding for programs for the poor -- then one has to start asking questions of character.
More fundamentally, there is a moral distinction between the Republican and Democratic motivations for slanting the truth, analogous to the moral distinction between someone who robs the rich to give to the poor, and someone who robs the poor to give to the rich. Both are stealing, but one deserves a harsher sentence.
"All governments lie, but disaster lies in wait for countries whose officials smoke the same hashish they give out." - I.F. Stone
September 11, 2007 8:30 PM | Reply | Permalink
Democrats, meanwhile, invest a ferocious amount of energy in denouncing even cuts which cost a relatively small amount of revenue, such as the capital gains and dividends tax cuts, the repeal of which would raise perhaps 0.1% of GDP, or about 6.5% of this year's projected budget deficit.
It's Bush himself who argues that his dividend and capital gains tax cuts give hundreds of billions of dollars in tax relief to Americans--the argument that we should accept them because they're just a drop in the bucket is kind of novel.
September 12, 2007 4:37 AM | Reply | Permalink
There is, of course, little or no evidence of the first seven words in this sentence. That is, of course, why McArdle said it. She should still to beating war protesters with 2X4's.
September 12, 2007 6:23 AM | Reply | Permalink
For whatever reasons, ever since the big tax dialogs started with the Reagan years you can plainly see deficits growing when these guys had their way, and deficits shrinking during the Clinton years. I assume Clinton was as popular as he was because of this. As you say, the public is not stupid, and I think the public knows the point that you ignore: deficits matter. Money has to be payed back. As a result, this is one of the largest portions of where our tax dollars go. In a sense, Clinton was on the road to giving us a really hefty tax cut.
Well, these policies have now been shown for what they are. For whatever reason, there is a larger income disparity [which had been shrinking], the dollar is going down the tubes [take a look at the dollar vs euro since the euro was created. What do you see happening starting about 2001?], and smaller government gives us FEMA as a shining example of how things outa be.
Thankfully, the republican party is getting down to the size where maybe we can drown it in a bath tub.
dc
September 12, 2007 7:52 AM | Reply | Permalink
What I find amusing about this piece is that is moves very quickly from tax-cutting to budget-cutting. Tell me, is there any evidence that a reduction in tax rates leads to a reduction in government spending? No? Then why would any intellectually honest conservative continue using the "starve the beast strategy" after it failed so disastrously - not just once, but twice?
Second, if conservatives are simply using tax cuts as a means to cut government spending, why are these tax cuts always biasing their results to the very wealthy? Wouldn't a much better strategy for these conservatives to offer tax cuts that disproportionately reduce rates on the middle class instead?
September 12, 2007 7:54 AM | Reply | Permalink
thirty years ago the Republicans, suddenly and for no apparent reason, become eviler, while simultaneously--luckily for them!--the American public, suddenly and for no apparent reason, became stupider.
No, what happened thirty years ago is that Republicans, not so suddenly but for a very apparent reason, acquired significantly more political power, and that reason is what's commonly referred to as the Southern Strategy. Of course, when talking about the modern class war initiated by Reaganomics, it helps to remember that if it weren't for the active collaboration of Democrats and Tip O'Neill, Reagan's disastrous tax cuts would never have passed, nor would they have needed to be somewhat rolled back a couple of years later (and later still by Bush Sr.). The "pigs feeding at the trough" were bipartisan hogs who agreed in principle that the benefits of capitalism should accrue mainly to capitalists, and every man for himself otherwise. And let's not forget that while taxes were being cut for corporations, the wealthy and investor classes, the Reagan era saw the imposition of the single largest, most regressive tax increase in our history in PAYROLL taxes, a revenue stream that continued to enable further tax cuts for the wealthy, and fueled the "surplus" right up until our present-day pigs wiped that cupboard clean.
All this talk of tax policy also obscures a host of other Goopertarian cruise missiles fired in the class war: The systematic evisceration of labor law and enforcement, ditto with OSHA, the undercutting of unions, outsourcing of labor, radical deregulation, offshoring of corporate headquarters and tax havens, worker-unfriendly "Free Trade" deals, etc. ad nauseum. Not to mention a fantasy wishlist that includes replacing even a vestige of progressive taxation with a "flat" income or sales tax, the total repeal of the Estate Tax, the elimination of Social Security entirely, scrapping overtime rules and worker and consumer protection of all kinds, environmental deregulation, also ad nauseum.
Douthat and McArdle argue that "class warfare" is an ad hominem attack upon well-meaning Goopertarians who've really only had the common good at heart. So it's only a coincidence that the results of their economic policies of the last 30 years have profited their wealthy constituencies to the detriment of pretty much everyone else. Okay, if these policies only had the common good at heart, then name one that has actually benefited everyone, and please spare us the trickle-down inanity.
September 12, 2007 8:05 AM | Reply | Permalink
'Wouldn't a much better strategy for these conservatives to offer tax cuts that disproportionately reduce rates on the middle class instead?'
Well, that would mean, because there are so many more poor and middle class, that there would be less tax cut per person. They'd probably go spend it on food or something. And agriculture is already subsidized. What you need to do is get the rich spending to support all those jobs in jewelry making and yacht building.
dc
September 12, 2007 8:10 AM | Reply | Permalink
I also remember his first budget almost did not pass, owing to not a single Republican member of the House or Senate voting for it. (Whatever happened to the traditional honeymoon period for a new president?) VP Gore's vote was needed. Dole said the tax increases would sink the economy. Clinton eventually had to back off on proposed cuts on grazing or mining subsidies, as I recall, as some western Democratic senators refused to vote for his budget unless he did.
He tried to get Congress to pass a modest "stimulus" package that included so-called "midnight basketball" funding for poor inner city areas. It sank in the Congress. In addition to Republicans, many Democrats in Congress not from urban areas were distinctly unenthusiastic about it. It was tagged as being money only for poor inner city areas, although I am not at all sure that was correct.
There was never overwhelming support for his trade agenda, notably NAFTA. There never is, in recent times, anyway.
September 12, 2007 8:13 AM | Reply | Permalink
Those Democrats. Constantly denouncing unnecessary giveaways to America's most wealthy.
September 12, 2007 8:20 AM | Reply | Permalink
Since 1980 the pay for the average American worker has been stagnant while the cost of living has increased rapidly. American workers who once got their health insurance provided to them by their employers now have to pay for it out of pocket. And the coverage they are getting shrinks while premiums skyrocket. Good paying blue collar jobs have been sent abroad while American workers that were displaced have to take minimum wage jobs at Wal-Mart selling products they used to make but now are being made by Chinese workers being paid $2.50 per day. These are drastic and clear cases of wealth being redistributed upward. Yet despite more wealth being leeched off for the top 2% under the premise all will benefit that has not been born out in reality. The wealthy have not been reinvesting in our economy and I have no doubts that will not change if left to the wealthy. Taxes should be increased on the wealthiest Americans for the good of the country. Our infrastructure is crumbling, our treasury is being bankrupted and more Americans slip towards poverty each day. It is time to shelve the "Let Them Eat Cake" economic model. The last 25+ years has shown that rigging the rules in favor of the top 2% for the benefit of all is a lie. It benefits only the top 2% and hurts everybody else and future generations...
My home when I am not ranting here...
September 12, 2007 8:51 AM | Reply | Permalink
"unlike marginal rate cuts, provide no positive incentives to increase work."
That is thrown out as if it is Holy Writ and really gets to the heart of what Chait is talking about. There is no plausible psychological explanation of why small changes in marginal rates would actually serve to increase work rather than leisure, even on balance, and it seems to assume that everyone is genetically equipped with a mental tax calculater. Moreover there is little to no statistical support for it. Yet it is just thrown out as if it is too obvious to even challenge.
It reminds me of nothing more than Bryan Caplan's suggestion that people who don't understand that minimum wage increases kill jobs should lose their right to vote. Well Prof. Caplan I know why you say that, theory drives you there, too bad real life data doesn't back you up.Who's Afraid of Democracy
"If only every audience could be filled with economists who know the score."
Yeah a score predetermined on day one of Econ 101. Our policy problems don't stem from too few people inspired by Milton Friedman but from too many. A little too much faith going on and not enough data.
"The American public seems to prefer spending and tax revenue stuck around 18-20% of GDP. That frustrates Democrats who want to grow that share, and Republicans who want to shrink it; but it's been remarkably stable for the last 40 years or so."
That is not the issue at all, there is no evidence that the American people targets GDP or could, they don't have the data or the mathematical tools. The real issues between the parties are how to allocate that spending. Once again there is zero evidence that Republican Administrations or Congresses want to shrink overall government spending. None. Zip. Nada. They simply seek to roll back the New Deal to the advantage of defense spending.
It is this kind of sloppy repetition of Grover Norquist faux Libertarian talking points that leads to some of the ridicule sent your way. 'Rigor' is not just a word in the dictionary, it is the key to persuasive argumentation. This piece was sadly lacking, I might even say 'Limp'.
September 12, 2007 8:53 AM | Reply | Permalink
Uprated because your kudzu analogy seems to perfectly describe why supply-side economics doesn't work. Further extending the analogy, if we apply ecological concepts to our economy, it becomes pretty clear that Summers' case for supporting tax deductions that help lower-income people isn't purely moral, but makes sense in terms of the overall health of the economy.
If we think of the economy as an ecosystem (and why wouldn't ecological concepts apply?), when one species becomes completely dominant (think the super-rich and the mega-corporations here - the ones that supply side theories ultimately benefit), the entire system becomes vulnerable to collapse. Perhaps Summers was merely proposing the economic equivalent of a healthy biodiversity.
Too bad there aren't more like him...
"If the only tool you have is a hammer, you tend to see every problem as a nail." ~~ Abraham Maslow
September 12, 2007 8:55 AM | Reply | Permalink
Wouldn't the increase in leisure ultimately lead to more work, just not necessarily by the person engaging in the leisure time? After all, people engaging in leisure spend money doing it.
"If the only tool you have is a hammer, you tend to see every problem as a nail." ~~ Abraham Maslow
September 12, 2007 9:04 AM | Reply | Permalink
Yes, at the moment, Democrats aren't overly concerned about the deficit. Nor should they be. The infrastructure of the whole country is falling apart. Sometimes you spend in debt to save money in the long run. Money used to stop bridges from falling down or to build information networks is money well spent, deficit or not.
As for why taxes are the big issue -- you dismiss the impact of taxes for normal people. Let's take a look at my pay stub... About 35% of that money goes to city, state, and federal taxes (Including social security and medicare). Obviously, if I had 35% of my income back, I'd be way better off and wouldn't have any consumer debt. Anything I can get back from that, without giving up all of the social safety the U.S. offers, is a boon for me.
You talk about people wanting to soak the rich. Or, people supporting tax hikes on anyone but themselves. Well, of course. I support increasing taxes on the wealthiest so society can put the money to good use. But it isn't about chopping down the tallest poppies. It's about the relative effects of taxes on people's lives.
Tax a hedge fund manager at income rather than capital gains levels and he can still roll in his Mercedes without issue. The hedge fund manager might be annoyed, but he'll maintain his lifestyle because once you make more than $10 million or so a year, most creature comforts are affordable to you. A guy making $10 million after taxes and a guy making $15 million after taxes can still order the same overpriced appetizers at the same fancy restaurant. They'll miss the extra money they pay but it won't alter their lifestyles.
As you move down the economic ladder, smaller sums mean more. Save me $200 a month and I'll enjoy a better life. Tax me $200 extra a month and I'll wind up bankrupt.
And this is why most people believe that their taxes should be cut and that the taxes paid by the mega wealthy should be increased. It has nothing to do with class warfare. It's that the rich can pay and not suffer. The rest of us would be better off paying less and we can't afford to pay more.
Given that the rich can pay more taxes and give up nothing, it is absurd that the Republican party spends so much time protecting them, at the expense of everyone else. That's not an ad hominem. They do it.
Any true believer in the idea that people who pay less taxes get richer faster would say "I'm proposing a tax cut for everybody making less than $100,000 a year." Why is it that I have never in my life seen such a proposal?
By the way... you're 6'2"? Cool.
thosethingswesay.blogspot.com
September 12, 2007 9:51 AM | Reply | Permalink
The jist of McArdle's post is this:
The spectrum of policy making options has now become so narrow, that all we get now is tax rate tinkering.
Seems hard to disagree with that.
A corrolary to this is related to recent pushes to cut Corporate tax rates. Dems are agin' it, GOP for it. GOP says US corp tax rates are relatively high in the world. This might be true, but it also ignores the fact that PERSONAL tax rates in N. Europe are much higher, govt. services like health care are MUCH more extensive.
On the obverse, spending on military boondoggles isn't even close to the US. Consider not just hifalutin junk like the stars wars, but also the military contractors.
Our policy apparatus and tax policy has become weighed down with inertia.
Because there is no 'solar power lobby' there will never be any kind of 'prime the pump' type subsidies passed for church mice solar companies who can't write big checks, or don't already have some kind of govt. agency (like USDA for farmers) that looks out for their interests.
Yet we can do tax tinkering with big oil to give them enormous tax cuts even while their profits are at sky high record levels.
September 12, 2007 11:04 AM | Reply | Permalink
Ms. McArdle --
As my mother never said, but I will say to you: If you can't say something nasty about someone, then don't say anything at all.
When looking at any peaceful democracy with a long-standing two-party system there is a non-ridiculous theory -- call it "Broder Equilibrium," or Br.Eq. for short -- which states that the laws of politics are such that there is never an extended period during which one party is significantly morally "worse" (e.g. more mendacious, more corrupt), or "better", than the other. You would appear to be strong Br.Eq. subscriber, not because you feel that our two parties are necessarily indistinguishable but because you see their motives ("for sincere and honest reasons") and methods ("politicians...are all liars") as essentially equivalent/comparable.
Like many bits of economics, Br.Eq. may be appealing in theory but doesn''t describe the real world in practice. At least, this is what J. Chait is claiming: during the last 25 years, on the subject of taxes and finance the Republicans have been the Bad Party. They single-mindedly enriched the rich, to no particular good and at the expense of everyone else, all while hiding behind a shield of lies, deceptions and evasions. Yes, there may be non-bad people with an R after their names, but they are silently complicit and don't affect the end result. As seen by their general-public statements and to judge by their general-public actions (ie policy and legislation) on taxes, the Republican party of the last 25 years is _effectively_ a gang of lying plutocrats. This much, I believe, is simply on the public record and really beyond dispute.
You may agree, or you may not; but either way you should step up to the plate! You should either agree with Chait's contention, or you should dispute it and bring up evidence against it. Honestly, if you can't bring yourself to do either of these, then why are you posting at this Book Club at all? The substance of all your writing about Chait's book boils down to saying "OK, whatever; I can't be bothered, so let's talk about something else." If you don't want to talk about the book, then get off this TPM page; and if you can't be bothered to engage a scathing but well-documented indictment of a current political party, then you should stop taking up space at the Atlantic as well.
In what could be the best capsule summary of the national press during the last eight years, refusing to referee is in effect giving the game to whoever plays dirtier -- "all that is required for mendacity to triumph is that good reporters remain scrupulously even-handed." Worse, your above-it-all, "let's change the subject" demeanor is not just lazy, but strikes me as extremely weak; after all, trying to change the subject is a classic tactic of anyone who can't make a substantive argument (raise your hand if recognize this line: "Please! Please! This is supposed to be a happy occasion! Let's not bicker and argue about who killed who. "). If you've got anything better, then let's hear it.
In short, either say something or be quiet; don't keep taking the third option.
September 12, 2007 12:00 PM | Reply | Permalink
Maybe you were being funny, but what I meant was why not offer a "$1000 tax cut for everybody" plan rather than a "1% rate cut" plan. My guess is that the former would be a heck of a lot more popular, and would be harder for Democrats to attack because it would be pretty progressive.
September 12, 2007 1:05 PM | Reply | Permalink
Maybe not for long:
--Howard Dean in Sept. 2007 address to the National Baptist Convention
September 12, 2007 1:19 PM | Reply | Permalink
Well, these policies have now been shown for what they are. For whatever reason, there is a larger income disparity [which had been shrinking]
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Not true
http://www.cbpp.org/1-18-00sfp.htm
Income Disparities Continued to Grow in the 1990s
Over the 1990s, the average real income of high-income families grew by 15 percent, while average income remained the same for the lowest-income families and grew by less than two percent for middle-income families — not enough to make up for the decline in income during the previous decade.
September 12, 2007 2:04 PM | Reply | Permalink
Our policy apparatus and tax policy has become weighed down with inertia.
Because there is no 'solar power lobby' there will never be any kind of 'prime the pump' type subsidies passed for church mice solar companies who can't write big checks, or don't already have some kind of govt. agency (like USDA for farmers) that looks out for their interests.
Yet we can do tax tinkering with big oil to give them enormous tax cuts even while their profits are at sky high record levels.
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Huh?
http://www.renewableenergyaccess.com/rea/news/story?id=34850
For the first time in two decades solar technologies were granted a federal investment tax credit that will promote all forms of solar energy. This includes solar thermal systems that provide for a home's hot water, photovoltaic systems that provide electric power, solar-hybrid lighting technologies and even to the commercial developers of industrial-scale Concentrating Solar Power plants of the likes that were constructed in the California Desert in the late '70s and early '80s.
Specifically, the bill increases the existing 10 percent investment tax credit for commercial solar installations to 30 percent for two years with no cap on the amount of the credit. This applies to all property placed in service after December 31, 2005 and before January 1, 2008; credit reverts to the permanent 10 percent credit thereafter.
September 12, 2007 2:16 PM | Reply | Permalink
He tried to get Congress to pass a modest "stimulus" package that included so-called "midnight basketball" funding for poor inner city areas. It sank in the Congress. In addition to Republicans, many Democrats in Congress not from urban areas were distinctly unenthusiastic about it
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It was interesting in that Clinton campaigned on how poor the economy was, even though the early 90s recession had been over for a couple of quarters. It was as though he felt like he had to follow through with his campaign rhetoric and offer the stimulus package. I think by that time Congress realized that it wasn't needed as the economy was growing again.
September 12, 2007 2:29 PM | Reply | Permalink
Chait is just playing to type for one of the great truths in US politics:
"To understand the workings of American politics, you have to understand this fundamental law: Conservatives think liberals are stupid. Liberals think conservatives are evil."
September 12, 2007 2:43 PM | Reply | Permalink
I think many conservatives are stupid or 'misguided' at the least.
Also, the notion of a 'conservative intellectual' doesn't jibe well with the anti-intellectualism of conservatives, while liberal intellectuals at "radical" college campuses are considered normal.
September 12, 2007 3:51 PM | Reply | Permalink
The argument doesn't strike me as mean or falsely 'objective.'
I see the point: We've been reduced to dialing in tax rates as the entire policy debate in this country. We almost can't talk about what to do - just what 'incentives' the govt offers in the tax code to do it.
From a business perspective, the constant fiddling with the code and the complexity are not helpful - except to tax lawyers of course.
September 12, 2007 3:54 PM | Reply | Permalink
Well good to hear that.
I'm still thinking that newer industries have to fight an uphill battle since things like coal, oil nuclear are so heavily subsidized.
September 12, 2007 3:56 PM | Reply | Permalink
Megan's theory would be appealing if there were any truth to it. But Newton's Law doesn't hold in politics. For every conservative who argues that 21% of GDP is way too much government, there is not an equal and opposite liberal who thinks 19% isn't nearly enough. There just isn't.
September 12, 2007 4:00 PM | Reply | Permalink
Since 1980 the pay for the average American worker has been stagnant while the cost of living has increased rapidly.
I'm not sure that that statement is really accurate. Part of the reason that wages appear to be stagnant is that we keep importing more poor people from (among other places) Mexico, as Robert J. Samuelson points out. This could give the appearance of stagnent wages even if every individual person was experiencing wage gains, because the newcomers would be measured only after they came here and the gains in income they received compared to their home country are not counted.
"You say I'm a dreamer. We're two of a kind. Looking for some perfect world that we both know that we'll never find." - Thompson Twins, "Hold Me Now"
September 12, 2007 5:12 PM | Reply | Permalink
I have to say I didn't detect much content in that long, rambling, even bloviating post by McArdle. It could have been stripped of meandering self exposition and been reduced to a few paragraphs.
Also McArdle seems to completely not-get-it regarding economic policy.
In our developed economy the optimal economic policy, i.e. taxation/spending to achieve any current goal from ethical to efficient growth, may occur in the margins of spending, but may produce a very different ideological vector and destination.
Marginal investments, whether it's Toyota's investment in Hybrid drivetrains, or the US economic investment in high tech, while small relative to non-discretionary spending on steel and infrastructure, steers where we'll eventually find ourselves.
I don't understand how McArdle can miss that fundamental truth, while claiming greater enlightenment than even ordinary common sense folks. It seems the opposite. Her CV and that post don't fit.
PS, the sensational title was also shallow. Speaking of differences in approach, well written articles typically build readership based on content. Another strategy is a tabloid headline.
September 12, 2007 5:29 PM | Reply | Permalink
"To understand the workings of American politics, you have to understand this fundamental law: Conservatives think liberals are stupid. Liberals think conservatives are evil."
Only on economic issues.
It's probably the other way around in social and foreign policy arguments.
September 12, 2007 8:16 PM | Reply | Permalink
Republicans don't want government to be "smaller" any more than Democrats want government to be "bigger."
Democrats just want more government resources devoted to their priorities, while Republicans want less government resources spent on other people's priorities.
An important difference between the parties, it seems to me, is that Democrats recognize that their priorities will have to be paid for by someone (hopefully by those who can most afford it), while Republicans have convinced themselves, and keep trying, with sometimes greater and sometimes lesser success, to convince the rest of us, that their priorities can pay for themselves.
A political difficulty for the Democrats is that the people they most expect to pay for their priorities often don't share those priorities. For Republicans the difficulty is that their priorities often offer more limited benefit than they promise (for middle and working class voters) at a higher cost -- through tax shifting, weakened leverage in terms of wages, higher cost and lesser access to basic social resources like education and health care, lessened consumer and environmental protections, etc. -- than they acknowledge.
During the 1980 presidential campaign I worked for an ad agency that represented one of the nation's largest defense contractors. Our client was a significant behind the scenes Reagan supporter, its executives were jubilant about the possibility of his election, and quite up front about the reasons for their support -- his election would mean a huge increase in defense spending and lower taxes. (In other words, not smaller government but bigger government, smaller revenue.) They didn't, any more than any of us do, need economic theory to convince them of their own self-interest. Although I'm sure, if pressed, they would have been happy to enlist economic theory to justify their own self-interest.
Tax policy isn't determined by economists. It's determined by political activism, competition and compromise among a broad array of social and economic interests.
September 13, 2007 12:50 AM | Reply | Permalink
Relative terms. Did not the economy get a whole lot better? Or maybe we should think "for which groups do these terms apply"
Set your sites a little higher than "not a recession"
dc
September 13, 2007 4:50 AM | Reply | Permalink
"Well, these policies have now been shown for what they are. For whatever reason, there is a larger income disparity [which had been shrinking]
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Not true"
True.
Read it again, one word at a time. What you posted agrees with what I said.
I have to work for a living, so I have not the time to search out any web site that would have the graph that would show from the 1940's to about 1980 a trend of shrinking income disparity, which then reversed until this day. I can remember reading this off somewhere in the past, but where eludes me.
dc
September 13, 2007 5:16 AM | Reply | Permalink
I really find the use of this cheap device, I don't want to say "x" so I'll say it anyway." pretty disingenuous. It makes me immediately question the intent of the user.
Just to cut down the tall poppies?" Hoo boy. They just want to cut them down, why? Because they're mean and jealous? Is that the implcation? Or is it because balance is generally better than imbalance? You are attempting, and failing to create the impression that a common sense, centerist position is somehow bad.
It isn't. Democatic policies have always been aimed at balance. Republican policies are aimed an imbalance in favor of the wealthy.This is truly unbelievable. "starve the beast" is the policy of whom? Bush? Are you joking? Bush has implemented the largest increase in Federal Government, ever.
"Bloat the Beast" would be far more accurate here.
Democrats wanted to help family farms and invest in infrastructure. The last bit is pure codswallop. Once again, thse are good, common sense approaches that you are trying o portray differently.
Excuse me?No Democratic candidate is talking about UHC? They aren't discussing the deficit? Not discussing investing in infrastructur? You must have gotten the terms "Democrat" and"Republican" confused, here. It's like watching primaries for two different countries. The Democratic candidates ARE talking about Fiscal Issues, including the deficit, thanks largely to John Edwards. Are you just not watching and getting your opinions from WorldNet Daily, or something?
20 years ago? Gee what happened 20 years ago? Oh. Ronald Reagan and his "trickle down" economics? Well, that explains why. Of course, for the eight years Clinton, the only Democratic President in that time, slowed and started to reverse that trend, by raising taxes on the rch. Imagine that.
Well, Republicans have always been rather selfish, it isn't as though this Gilded age is different from the last one. That was around the time people like you started treating the American people like stupid rubes. What actually happened was that the public started getting lied to and told only one side of the story. Who was President when they eliminated the Fairness doctrine? Oh yeah, Reagan, again. He was a marvelous actor, wasn't he?
As you did that on your earlier blog post regarding this book and it's ideas, I think your simpering backhanded insult is a fitting end to this accumulation of utter tripe. I'm thinking of canceling my Atlantic subscription. You appear to think the American public is "stupid."
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September 13, 2007 6:42 AM | Reply | Permalink
So when did you actually buy and read this book, Ms. McArdle? According to your Atlantic blog post, you didn't have a copy of the book Monday morning (though that didn't stop you from launching various arguments in Chait's general direction based on his New Republic writings). By Tuesday night you had written the above post about the book, which, conveniently, barely mentions any of its substance. Could you perhaps produce a receipt?
September 13, 2007 9:36 AM | Reply | Permalink
I wrote something dumb here but edit doesn't allow me to delete. Anyone who wants to should feel free to delete this.
September 13, 2007 10:25 AM | Reply | Permalink
It's a start, it hardly compares with the subsides we offer big oil, however.
A drop vs. a tsunami.
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September 13, 2007 10:30 AM | Reply | Permalink
I have to weigh in here as well. It is quite clear Ms. McArdle has not read the book, so I don't understand the value of this posting. Shouldn't the reviewer actually read the book? I submitted feedback to the site via the online form and have not heard a word.
I had never visited this site prior to reading this posting. Is everything on this site so amateurish?
September 14, 2007 6:27 AM | Reply | Permalink
Uprated because the newbie has a point. Disclosure on whether the contributor has actually read the material would simply be good manners, as well as professional.
CSPAN junkies visit http://spannerbackup.ipbhost.com
September 14, 2007 10:09 AM | Reply | Permalink
Uprated because the newbie has a point. Disclosure on whether the contributor has actually read the material would simply be good manners, as well as professional.
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The specter of that moment haunted me throughout my reading of The Big Con.
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Good manners seem to be in short supply in this comment thread
September 14, 2007 11:26 AM | Reply | Permalink
El Campanino, nothing of what McArdle wrote said anything of substance from the book itself--not a single quote, indeed not a single detail. She mentioned the "thrust" of the book and otherwise just rambled on about her own ideas. As Walter Crockett noted above, she admitted to not even owning the book 24 hours before posting this "review." But even minus that factoid, it is quite clear from the breezy, fact-free "review" here that she has not read the book.
I taught freshman English for years. I can tell when a student hasn't done the required reading.
As to your bizarre remark, "Good manners seem to be in short supply in this comment thread," you can't possibly be referring to me. Explain exactly what is rude in what I am saying. Otherwise, spare me your little hit and run snark. It bores me.
September 14, 2007 12:08 PM | Reply | Permalink
That poster likes to give 1s to whomever he doesn't agree with, apparently. It is a bore.
However, he is correct, I did forget that McArdle mentioned in passing that she "read" the book.
I suppose that I was taken aback at her assertion that a public figure putting the needs of the people ahead of economic concerns was so disturbing as to be described as "spectral."
Frankly, I found that little anecdote so disturbing, it wiped my memory of the passing remark. So I apologize. Perhaps her reading of the book was as shallow as I find everything about her understanding of the principles involved.
Who knows?
In the meantime, welcome, and don't let ratings abusers get you down. There aren't too many of them.
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September 14, 2007 12:25 PM | Reply | Permalink
I found it interesting that you came trotting over here from The Atlantic to join and continue your harrassment campaign. Have you read "The Big Con"? You have no way of knowing if McArdle did or not in the 36 hours between posts. So why don't you give it a rest.
The default position of this and every one of your comments here and at the Atlantic is that McArdle is acting in bad faith. If she bothers you so, go somewhere else.
Instead you make no substantive comment of any sort on her post and complain, asserting that she hasn't read the book. Something that you have no real way of knowing about. Now that IS boring.
September 16, 2007 10:59 AM | Reply | Permalink
You may be onto something. :-) I believe the title and the last sentence of her post here (above) may have been chosen partly because of her dealing recently with those points on a wider basis, they may be on her mind, as it were.
Aside related to your "bad manners" comment elsewhere: What's amazing to me is that more bloggers do not chose to just turn comments off (like Billmon once famously did,) as virtually all blogs with comments capability have the option to do that. On The Atlantic, for instance, it seems to be by choice of blogger to have comments capability. It's not like it's a "human right" to run around practicing ad hominen skills on blog comments. :-)
September 16, 2007 11:27 AM | Reply | Permalink
El Campasino, you call it harassment. I call it calling someone on dishonest behavior. She clearly hasn't read the book, and it has nothing to do with the timing, as I noted. She said absolutely nothing of substance about the book. She waved at it momentarily, and then prattled on with her own, superficial ideas. Substantive comment? Substantive comment about her lighter than air thoughts that have nothing to do with the book? My point is she hasn't read the book, and has nothing of substance to say.
As for your demand that I go "go somewhere else," let me completely blunt. Drop dead. My job is not to amuse you or make you happy. And your job is not to tell me what to do, what to read, or what to say.
September 16, 2007 8:17 PM | Reply | Permalink
As for your demand that I go "go somewhere else," let me completely blunt. Drop dead. My job is not to amuse you or make you happy. And your job is not to tell me what to do, what to read, or what to say.
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Struck a nerve there didn't I?
I can't and didn't demand you go anywhere - merely a suggestion. You're perfectly free to continue making tiresome unsubstantiated unproductive ad hominem comments anywhere you want
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Substantive comment about her lighter than air thoughts that have nothing to do with the book?
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When did you read the book? How would you even know? You're oh so superior
September 17, 2007 8:38 AM | Reply | Permalink
Lame response, "El Campasino."
It clearly was important to you to "strike a nerve." You have no point, beyond defending your little heroine here, and you just wanted my attention.
Tell you what, raise your game, and use your real name, and I will answer you in the future. Since neither is going to happen, I will file you under "whining punk" and forget about you.
September 17, 2007 9:00 AM | Reply | Permalink
Lame? Let's see, you've been a member here for three days and have posted a total of four comments on one post that have said nothing more substantive than "I hate Megan". No facts, no cites, not even "Megan is wrong because..." Now THAT'S lame.
September 17, 2007 10:12 AM | Reply | Permalink
Just as I thought. Not up to the task
"cricket........cricket"
September 17, 2007 11:29 PM | Reply | Permalink