The Season of Miracles

As this interminable summer of unpleasant confrontations and dreadful poll numbers draws toward its end, be of good cheer, Liberals.

Republicans want to debate extending the Bush Tax Cuts. This is like being a bullfighter in a wheelchair. There is no way this will turn out well.

If the Bush Tax Cuts had worked, it would be logical to expect the following:

1. Full employment.

2. A shrinking deficit.

3. Growth of middle class incomes.

This is, after all, the premise upon which the Tax Cuts were sold in 2001. At the time, the federal surplus was in the neighborhood of half a trillion dollars. The unemployment rate hovered within a few ticks of 5%. The spending power of the median US family was about 20% more than it is today.

Supporters of reinstating the Bush Tax Cuts will argue some points. 9/11 will come up, as will the subprime mortgage fiasco. The suggestion will be made, with some tenuous supporting evidence, that the middle and lower classes are paying less in taxes today than they did ten years ago.

9/11 was certainly an impact upon the American economy and psyche. There are now two wars as a result, at a cost of (roughly) a trillion dollars a year. Our presence in Iraq is questionable, at a cost of having lost bin Laden at Tora Bora.

For those who would suggest that Liberals do not support the armed services, one wishes to query. Starting a war, sending troops without adequate intelligence or correct equipment for the job, and then the whole thing turns out to have been done on crap evidence, well, how supportive is that? Cutting benefits and placing stop-loss orders is not supportive either.

The subprime meltdown is another case of the path to hell being paved with good intentions. Yes, Clinton signed the repeal of Glass-Stegall. Being truthful, quite a few Liberals and Progressives were convinced that the economy would continue its exponential growth. Senator Russ Feingold (D-WI) is among the few who get a pass for not following a dumb, but popular, idea.

For every Conservative who loves Madame Palin’s “How’s that hopey changey stuff workin’ out for ya,” there is a guy, whose residence has a license plate, looking for a deregulation Republican to park his home on. This individual is paying less in income taxes, because 15% of zero is zero.

The Laffer curve was great while we were on the upslope. The downslope is as frightening as anything found at Cedar Point in Sandusky, Ohio. We are facing something that would have a very peculiar interpretation of y=mX+b. A point came somewhere around five years ago when we passed the intersection where lowering the marginal tax rate would result in increased revenues.

What would work is getting back to what we already know works. The pre-Bush economy worked.

President Obama has been holding this move for months. There is no way he does not want the Bush Tax Cut debate to come to the floor of Congress. The population which would be most affected voted something like 90% in favor of Senator McCain two years ago. There is no political downside for Obama.

If the usual litany of Conservatives begins to pontificate on the virtues of this particular tax cut regimen, then the Democrats don’t have to run against individual opponents. They are now running against people who prospered when most people did not and George W. Bush. That works quite well.

The wealthy will cry victim, as with any group which has become dependent upon public largesse. There is something decidedly unsympathetic about any group prospering on somebody else’s dime. Welfare kings from Beverly Hills to Beacon Hill are even less sympathetic when one has faced the loss of a career, a home, or a marriage to economic instability.

Governments cost money to run. A progressive taxation policy is not punitive to producers. It means that those who have prospered under a free, democratic system are also responsible for maintaining the integrity of the system which has enabled their prosperity.

Producers know that debt is not a smart choice. The nation is overleveraged. We can ill afford to dump US$700 billion on people who sat on it the last time. An economically broken government cannot assure the security of the nation it serves.

And if he has to, Obama’s going to veto the Bush Tax Cuts anyway.