In Monday’s New York Times, columnist and Nobel laureate Dr. Paul Krugman telegraphs the Left’s long-term fiscal strategy when he writes about California Republicans.
For what we may be seeing is America starting to be Californiafied. … And if Tea Party Republicans do win big next year, what has already happened in California could happen at the national level. In California, the G.O.P. has essentially shrunk down to a rump party with no interest in actually governing … but that rump remains big enough to prevent anyone else from dealing with the state’s fiscal crisis. If this happens to America as a whole, as it all too easily could, the country could become effectively ungovernable in the midst of an ongoing economic disaster.
The strategy is simple:
- Increase government spending, especially through rapidly growing entitlements. At the state level it’s Medicaid.
- Wait. While you’re waiting, define deficits as the problem, rather than spending.
- Try to label as radical and extreme those who argue for slowing spending growth and preventing tax increases. The goal is to discredit these solutions as legitimate.
- Once deficits get large enough, shrug and say we have no choice but to raise taxes. This is especially true for entitlement programs directed toward the elderly, who have less ability to adjust to changed government promises.
- Argue we must protect low and middle-income from higher taxes, so upper-income taxpayers must bear the entire burden increase.
- Raise taxes on upper-income taxpayers.
- Rinse and repeat.
This is a simplified version of an Engorge the Beast strategy, which is almost the converse of the Starve the Beast strategy developed about 20 years ago by some on the Right.
When Dr. Krugman writes “no interest in actually governing … prevent anyone else from dealing with the state’s fiscal crisis,” he means “no interest in raising taxes … prevent anyone else from raising taxes …”
Sure the tea partiers are rauc0us, and the California Republicans are an embittered minority. Yes, there are some offensive fringe nuts at Tea Party rallies. Both parties have their paranoid nutcases and bigots. Dr. Krugman tries to use a few signs to discredit a reasonable position on fiscal policy. I would dismiss this as amateurish if the Times didn’t give him such a big megaphone.
California and the Federal government have another quite reasonable option available. Cut spending. Indeed, just slowing unsustainable spending growth would be a great start. California needs to do this with Medicaid, the Feds need to do it with Social Security, Medicare, and Medicaid, as well as with the new health care entitlement Congress is trying to create.
This is why I try to encourage elected officials to use the phrase “spending discipline” rather than “fiscal discipline.” Our long-term deficit problem is a spending problem.
New readers of this blog may find these related past posts helpful:
- A short history of higher taxes
- The total tax battle
- America’s long run fiscal problem is spending growth, not taxes