There seems to be puzzlement around (whether real or fake, it’s hard to tell) about Paul Ryan’s bona fides as a fiscal conservative/budget hawk. As Reason’s Hit & Run points out, Ryan voted for “TARP, Medicare D and even George W. Bush’s wars, each a budget-buster of its own on the road to fiscal calamity.”
There are two keys to this puzzle: Ryan is (1) a Randian always but (2) a Republican Party hack above all. As Randian, he loves anything good for the rich and hates anything good for the poor; that’s why he wants to shred the social safety net and spend all of the proceeds on tax cuts for the prosperous, thus not reducing the deficit at all. As a partisan hack (and closet Keynesian) he knows that deficit spending stimulates employment; that’s why he supports it under Republican Presidents and opposes it under Democratic Presidents, independent of the state of the business cycle.
Footnote The good news is that there’s no need to fear (with Josh Barro) that Ryan (or Romney) would actually pursue deficit reduction in the face of recession, should the country be unwise enough to elect them. They would goose the economy as hard as they could. And of course the Democrats, who actually care about the plight of the unemployed, would have to go along.
No good reason to fear? I fear this is so optimistic it reaches near-delusionality. You don’t really think Grover Norquist and the teabagger Congress are going to settle for business as usual if they win it all, do you?
No, they’ll “compromise” on lower taxes on rich people, smaller benefits for poor people, and lots of deficit spending to get out of the recession so they get re-elected.
We can be reasonably sure that most of the deficit spending will be directed to the war machine. My guess would be a big “missile defense” ramp up. Domestic expenditure would create the erroneous impression that there is a public purpose. Better to carry on with Pharaoh Reagan’s great pyramid.
This isn’t the same old GOP congress. You might well have been right 20 years ago - but the teabaggers know perfectly well that same old, same old will get them primaried and run out of their districts. These are the people who wanted to wreck America’s credit, for heaven’s sake. You can’t assume that they aren’t true believers. All the evidence so far suggests the opposite.
Republican primary voters won’t care unless Fox news and Limbaugh start playing the drums, which they won’t, and tea party d00dz in congress will go along with their leaders since party unity runs so deep
I’m not sure this adds up.
Tax cuts for wealthy people raise the deficit, but their stimulative effect is smaller than almost anything else that does that. So they will be limited in what they can do for stimulus, even if they want to do something.
And remember that a big part of their base, amply represented in Congress (and presumably all the more so should Romney win) regards the whole stimulus idea as some sort of Communist plot. They’ll go along with weakly stimulative tax cuts, for “job-creators,” but not more spending.
A war, or two, or three, is perfectly “good” stimulus.
No one is going to say that extravagant defense expenditures are for stimulus purposes. But there is a sacred circle around “strong defense” that cuts it off from “same old, same old”. Defense spending is the only usable tool closet Keynesians have at the their disposal, and they can use it after casting a spell of “clear and present danger”, which will work again as it always has.
Exactly.
If Romney/Ryan win, then we can also expect a substantial increase in the Tea Party contingent in Congress. I don’t see how Congress will allow any budget but an austerity budget to be passed. Romney may argue in private against this, but he won’t have the power or influence to prevent this. We’re in for a real financial crisis in that case.
“We’re in for a real financial crisis in..”… any case.
Financial systems And governments worldwide are “underwater”
And,
We still have December 31, 2012 to get past
Feel the bi-partisan love.
And let’s not forget the magic of “off-budget expenditures.” So useful. They came to a trillion or so, at least, in the bush years, without adding a thin dime to the official deficit. Whatever emergency gets conjured up will undoubtedly resurrect that vaporous phrase and so give us deficit reduction and (hush, hush) stimulus at the same time-
“Without adding a dime to the deficit.” How do you write that with a straight face?
Yes, I know that’s the way “they” calculate the “deficit.” They add up the budgeted collections and subtract the budgeted expenditures, and the net is “the deficit” or “the surplus” in the budget. Somehow, of course, the “debt” (which is real, not budgetary) as the sum of successive “deficits” doesn’t quite compute.
Sadly, in my family, where we have to operate on a cash basis, we don’t get to live on our “budgeted collections” and “budgeted expenses.” We have to add up our realized income and subtract our realized expenses. If the expenses exceed the income, we have a net increase in debt, which we call our “deficit.”
Isn’t is a shame we can’t all live on our “budget” instead of our actuals? Or perhaps … Isn’t it a shame we can’t get our government to tell the truth about income and expenses, instead of “budgets?”
If these bozos are elected, we will all be “privileged” to watch a natural experiment on how the composition of government expenditures matters. Back during the stimulus debate, if memory serves me correctly, the estimates for marginal contribution to GDP ranged from 30 cents on the dollar for tax cuts on the rich to $1.70 on the dollar for income and food-purchase support for the poor. This in turn suggests that you could increase the deficit by several hundred billion dollars a year while remaining GDP-neutral — and quite probably employment-negative.
I think that if Romney and Ryan are elected they will attempt to stimulate the economy, but their ideological blinders (and those of the republicans in congress) will be such as to make things worse. (And even missile defense would only be a few tens of billions of dollars a year. Paltry compared to a new war.)
Is TARP a budget buster? Or is it the most fiscally sound governmental program in history that no one wants to take credit for?
Am I confused? Did TARP actually cost us anything?
A very selective Randian. The title would be damnable but the reality is even worse. Omits social issues-which were not optional, and replaces them with patriarchal tyranny. Certain kinds of endless fiscal outlays are fine-so long as they don’t actually improve people’s lives. Pseudo-Keynesianism by cutting marginal tax rates had long since run it’s course, if it ever had one-before Reagan got elected. Reagan’s recovery wasn’t Keynesian, it was the beginning of bubblenomics, fundamentally different. Now tax cutting has the reverse effect-tanking both the economy and govt revenues, Laffer had our position on the Keynesian curve exactly wrong even then. See Presimetrics on the folly of cutting taxes to stimulate the economy, and Galbraith’s Predator State on whose curve Laffer drew.
Given his voting record in congress, he comes across more as a Randian villain than a Randian.
“They would goose the economy as hard as they could. And of course the Democrats, who actually care about the plight of the unemployed, would have to go along.”
Yes! Yes! A thousand times yes!
They would gladly spend more to get the economy going so long as they are in charge. Of course they’ll gut programs for the poor, but they will stimulate and if they stimulate enough to get the unemployment rate down they’ll go right back to more tax cuts for the rich and screw everyone else.
Completely different from Obama who seems to have no idea that lowering the unemployment rate isn’t just good policy, but actually gives him clout to do more things - good things that help everyone and decrease the size of our problems. I really would like to vote against the Republicans because they are trying to turn the country back to the 19th century, but I just don’t know if I can make myself vote again for the ever clueless Obama.
Whatever Obama is, it ain’t clueless. He’s just not that into you/us.
I know, “political realities” … … “republican obstruction” … [yadda yadda] …
I’ve known since Nov 4, 2008 that I would be voting for Obama this year. It has been a foregone conclusion because A) the Dems were NOT gonna nominate anyone else in 2012, and B) the Republicans would out-do Obama on galloping neo-feudalism regardless of what happened in his first term.
I wasn’t overly impressed with Obama in 2008, but thought he might beat my expectations. Actually managed to underperform. Still better than R-Money and the Randroid kid.