It looks like Bush’s favourite tools are going to be used by Obama, despite what a mess they put the government in. Too many politicians go with the message of cutting taxes, yet politically important groups seem to get funding when needed. So now the President needs to spend money to get out of the current situation. I will grant him that. I agree with spending money on infrastructure projects that aim to get people back to work. But why on earth would you cut taxes on people who are currently working? So they can spend more (fat chance). Why give up that money that could save the nation from going even further in debt?? I just do not understand. The wise Gregg Easterbrook had this to say in his Tuesday Morning Quarterback column:

If Teenagers Borrowed to Spend the Way Washington Borrows to Spend, Adults Would Call Them Irresponsible: Since the taboo against serious deficit spending in peacetime was shattered under Ronald Reagan, presidents and Congress have borrowed lavishly to give constituent groups and special interests whatever they want — then handed the debt to our children and grandchildren, all the while wagging their fingers about how somebody else must do something about the federal deficit. George W. Bush added the wrinkle of simultaneously cutting taxes and borrowing to increase spending, all the while wagging his finger about the deficit. The result was that the national debt nearly doubled in eight years. But Bush will never have to deal with that, since he will be retired when the bill comes due. Bush took the easiest possible path, cutting taxes and increasing spending, leaving the real work for someone else. The easiest things for a politician to do are to cut taxes and increase spending. Tax cuts and spending increases are candy. Dealing with the deficit is castor oil, since this requires either increasing taxes or reducing spending. (Tax reduction can raise government revenues if the cuts increase economic growth or capital-gains transactions. This happened in the mid-1960s, late 1980s and third and fourth Bush years; the effect has never been sustained, however.) Barack Obama was right last week to call Bush’s handling of the country’s finances “profound irresponsibility,” though, of course, Democrats in Congress went along with it.

This matters in the context of the incoming president’s aides estimating the current fiscal year federal deficit will balloon to $1.2 trillion, double the worst number under Bush. At $1.2 trillion, the 2009 deficit will represent roughly 8 percent of the GDP. That’s the worst borrowing-to-output figure since World War II — the previous max was 6 percent of the GDP under Reagan in 1983, while the postwar average is less than 3 percent. The soaring debt is worrisome for many reasons, not least because it represents headlong borrowing when there is no national emergency. Terrorism is a concern, but not an emergency. The economy is a concern, but recessions are cyclical and all previous postwar recessions cured themselves. Though life is mainly normal, we’re borrowing as if the whole world were at war. If the United States borrows like mad even when things are under control, what’s in reserve for a genuine emergency?…

…Note in this regard that Obama is expected to propose $300 billion in additional tax cuts — that is, simultaneous to increasing spending by borrowing, he proposes to slash federal taxes for the third time in eight years. Maybe stimulus spending, underwritten by borrowing, is justified as a lesser evil because it will cause economic growth to resume. But further tax cuts are a horrible idea. Suppose the economy is fine in a year or two, and Obama wants to reverse his 2009 tax cut in order to address the deficit. Obama’s opponents and cable news will shriek, “He’s raising taxes! He’s raising taxes!” Borrowing for further tax cuts that will exist for many years if not permanently is reckless, as opposed to borrowing for specific one-time payments.

The rest of his ESPN.com article is here.

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