Political Hay
Down With Obamunism
The opportunity is now there to downsize government — and for starters that means rejecting any talk of a Deficit Commission.
Senator Judd Gregg (R-NH) is retiring from Congress this year. Congressman Frank Wolf (R-VA) should do so as well. The two are sponsoring a bill with Senator Kent Conrad (D-ND) and that “Blue Dog” con artist Congressman Jim Cooper (D-TN) for a Deficit Commission. This is the worst legislation sponsored by any Republican in this Congress, as it would provide cover for the largest tax increase in world history by far, and would ratify rather than oppose the Obama explosion in Big Government.
That is why indications are that President Obama will endorse this Deficit Commission concept in his State of the Union Address this year, after exploding the federal government to peacetime records. As the Wall Street Journal explained it on December 29,
After signing a $787 billion economic stimulus and embracing two annual blowout budgets that will double the national debt over 10 years even before ObamaCare, President Obama is poised to pivot [this] election year and denounce the horrors of deficit spending. So the White House is now floating a bipartisan commission to reduce federal borrowing, and much of the political class is all for it.
The Journal explained just how reckless Obama’s spending has been: “From 2001 to 2008, under President Bush, federal…discretionary spending grew by 54%. Mr. Obama’s policies have expanded these agency budgets by another 57% over just two years.” Obama has also increased federal welfare spending by one-third over the first two years, with total government welfare spending now slated at $10.3 trillion over 10 years.
Under the Gregg-Wolf free market murder bill, 16 Washington experts would be appointed to a Commission with a mandate to look at everything from entitlements to taxes, and propose specific reforms to balance the budget. Congress would then vote up or down on the entire package without amendments, on an expedited basis.
From the early 1950s, after federal spending settled down following World War II, until last year under President Obama’s neo-socialist revolution, federal spending was stable during those 50 plus years at around 20% of GDP. Today, after one year, the federal government is 40% larger at about 28% of GDP, a national tragedy in terms of lost economic freedom. But federal projections show that by 2040 federal spending will soar to close to 40% of GDP, due primarily to the exploding entitlement programs Social Security, Medicare and Medicaid. Dumping Obama’s national health care program on top will just make the situation much worse.
Add in state and local government spending, and total government spending will be well over 50% of GDP. Counting the Obama spending increases and the negative effects on the economy from all this Overwhelming Government, total government spending will grow to over 60% of GDP.
If anything even close to this happens, America will be over. We will be socialist Sweden instead, which even Sweden is leaving behind now. Traditional American prosperity will be gone. Forget about the American Dream. We, as a nation, would no longer be worthy of that. Under the new system where we give most of what we earn to government bureaucrats and they tell us what we can have and how to live, the whole notion of economic freedom and prosperity will have been eradicated.
A Deficit Commission with taxes on the table is not going to solve this. Just what kind of a deal can we possibly expect from such a Commission of Washington experts, especially with a majority appointed by ultraleft President Obama and current congressional leaders? With federal spending currently slated to soar from 20% of GDP to close to 40% at least, the best deal we could possibly hope for would be for federal taxes and spending at 30% to 35% of GDP. That would mean a massive increase in taxes in return for a massive increase in government.
As The Wall Street Journal explains:
We only hope Republicans aren’t foolish enough to fall down this trap door, though some are already tempted. A budget deficit commission is nothing more than a time tested ploy to get Republicans to raise taxes. In the 2009 version, Republicans are being teed up to hold hands with Democrats and agree to become the tax collectors for Obamanomics.”
In other words, this Deficit Commission is very bad strategy for Republicans and conservatives. The Journal reveals the tax goal liberals hope to snooker Republicans into supporting: “Republicans would agree to an increase in the top income tax rate to as high as 49% and in addition to a new energy tax, a stock transaction tax, or value-added tax. The Indians got a better deal for selling Manhattan.”
Republicans who are tempted by this snare need to wake up and smell this coffee: you will be challenged by a third party that would not mind dividing the vote and replacing you with a Democrat they can defeat later. Conservatives and libertarians who believe in free market prosperity will have no other political choice.
The 15 Percent Solution
A far better alternative has been offered by Rep. Patrick McHenry (R-NC), who has proposed a Commission dealing only with spending reforms, with tax increases off the table. Conservatives, libertarians, free market advocates, Republicans and the Tea Party movement should work precisely for addressing runaway spending, deficits, and debt by reducing spending, deficits, and debt. Taxes are not part of the solution. They are part of the problem, providing the financing for permanently higher spending. Our goal, in fact, should be to reduce federal spending over time below the long term 20% baseline, down to 15% of GDP, which would reflect our belief in smaller government, and leave us with long-term budget balance.
About the Author
Peter Ferrara is Director of Entitlement and Budget Policy at the Heartland Institute, General Counsel of the American Civil Rights Union, Senior Fellow at the National Center for Policy Analysis, and Senior Policy Advisor on Entitlements and Budget Policy at the National Tax Limitation Foundation. He served in the White House Office of Policy Development under President Reagan, and as Associate Deputy Attorney General of the United States under President George H.W. Bush.
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Pingback| 1.13.10 @ 7:52AM
Must Know Headlines 1.13.2010 — ExposeTheMedia.com links to this page. Here’s an excerpt:
Ryan| 1.13.10 @ 8:22AM
Great summary of what should be done. Theoretically, we were supposed to get a lot of this in 2000-2008, but we had a President that kowtowed to the left far too much.
Indiana Alex| 1.13.10 @ 8:37AM
Personal retirement accounts would represent the biggest transfer of wealth from government to the working poor in the history of our economy.
I mention the working poor as they are most unlikely to have 401k or pensions.
Since many die before they reach Social Security age, they would acutally have assets to leave behind rather than a government promise.
crookedwren| 1.13.10 @ 9:14AM
The downside: whatever will my accountant do in March and April?
Wayne Farrar, CFP, CPA| 1.13.10 @ 12:10PM
crookedwren,
Don't worry about those of us who prepare taxes for a living. Too much of our nation's intellectual talent is currently diverted into nonproductive activities such as helping the true producers comply with government regulations. I can assure you that any CPA worth his salt would be riding high in the economic boom triggered by these policy changes.
Grant Johnson| 1.13.10 @ 10:00AM
Amen.
You have perfectly captured the agenda we need to pursue if we are to retain freedom and prosperity in this country.
It is also a perfect summary of the agenda the Republicans must truly embrace (as opposed to paying lip service) if they are to retain relevance. Democrats have fouled things up so badly the last year or three that Republicans may get another chance despite themselves, but they better understand that chance will be probationary. If they break faith again, they will go the way of the Whigs and a new party will eventually emerge to voice genuine opposition to the Democrats=Socialists.
Unfortunately in the time it will take for a new party to coalesce, my country may be irretrievably lost.
Kenneth Allen| 1.13.10 @ 11:45AM
Sell off surplus federal lands that are not part of national parks or historic preservation? I assume this would mean selling off all National Forests (and grasslands etc). Are you nuts? This would be the largest land sale in US history - about 10% of the total US land area, an area about the size of Texas.
SCM| 1.13.10 @ 12:26PM
......and the problem with this is what?
Howard| 1.13.10 @ 12:42PM
Nice dream! Unfortunately it will never come to pass. There is too much power concentrated in Washington. The lobbyist influence is too vast. Look, even a "capitalist" outfit like GE has been performing fellatio on the Democrats. They are looking for a managed economy (as long as they have no competition). We need to chip away on a hand full of vital issues and limit the rise of government. Bringing it back to 1920's levels will not happen. But, we need to stop Obama, Reid & Pelosi sooner than later!
Grant Johnson| 1.13.10 @ 1:27PM
People will say that these principles are not realistic and achievable. They are probably right in a technical, absolute sense.
However, these are essential to making any progress (and to gaining the trust of a fiscally conservative majority). Without these types of bedrock reality check principles, you end up voting for the $800 billion stimulus measure because, after all, you were able to negotiate a compromise smaller than the $1 trillion plus that was initially proposed. By contrast, someone fully focused on these ideals would recognize that 80% of a bad idea (or 50% or 1%) is still a bad idea.
The stimulus and a lot of other fooling legislation could have been stopped by a Republican party guided by these principles.
led mining light | 11.25.10 @ 1:56AM
For most Americans, Obama doesn't seem to be giving them something they don't have, but instead to be taking away something they already value.
Oldefarte| 1.13.10 @ 2:25PM
Great article and information, Peter! Bravo, and thank you! What is absolutely essential initially though is for the American taxpayer-voters, tea-partiers, etc to defeat any/all Democrats [and yes Republicans also] who have been responsible for our deficit/debt to get to the point of destruction that it now is. All of us have to vote for any/all conservatives who pledge/promise to begin abiding by the will of the people who elected them, who pay their salaries; instead of those who head their respective political parties in DC. Once we get the right political leaders in place in Washington, then and only then can we begin to institute the intelligent ideas that Peter has put forth here. It is useless and moronic to think that we have a chance of success toward accompolishing his suggested procedures, if the current bunch of liberal, socialists in DC are still in charge!!!!!
Pingback| 1.13.10 @ 6:07PM
Twitter Trackbacks for The American Spectator : Down With Obamunism [spectator.org] links to this page. Here’s an excerpt:
bluecollarbytes| 1.13.10 @ 8:58PM
article: "Add in state and local government spending, and total government spending will be well over 50% of GDP. Counting the Obama spending increases and the negative effects on the economy from all this Overwhelming Government, total government spending will grow to over 60% of GDP."
Showing that where we're headed is exactly the opposite of govt by/for the people. The very purpose of life itself will become to live in order to fund govt, which dovetails with Obama's earth-centered religion. I wonder if 60% of GDP would even cover all the growing Leftist demands of the future. What we're seeing today is just the bare minimum of their desires.
Mike| 1.13.10 @ 10:15PM
the Obama explosion in Big Government.
Lets review the bidding.
Who started two wars and did not include the cost of those wars in the federal budget?
Who created the HSA, a gigantic federal bureaucracy, when he promise to bring us small government?
Who sponsored the drug prescription program without a word about paying for it?
Who squandered the budget surplus and left us witgh an enormous federal deficit.
Bush.
And Ferrara is talking about the explosion of Big Government. You are a joke Ferrara. Too little, too late, Pal
Yosemeti Sam| 1.14.10 @ 2:26AM
Now, now - liberals.
Complaints about Iraq and Afghanistan - wars?
What you all are advocating is - best to have left those of those countries to the barbarian mercies
of 'same' - with their guns and medieval methods
of terrorized subjugation.
What empathy! What courseness! What phoney
baloney humanism!
Get thee under your rocks!
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