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The news is abuzz this week with news of the Republican plan to oppose Obama's spending bill with a proposal to cut taxes. Jim DeMint, a solid conservative from South Carolina, has a plan out, which includes an extension of the Bush Tax Cuts until 2013, and then a 10% cut across the board.
It's the wrong plan. Look - I'm not a politician or economist, but it's clear the problem we face is one of spending, not revenue. We keep growing the size and scope of the government the conservative plan is always to cut taxes, under the (very good) idea that allowing people to keep more of their own money is smart. Some conservatives think that cutting taxes is a way to starve government, but what we've seen during the Reagan and Bush II years was massive deficit growth. We cut taxes, which had the effect of raising revenue, but still outspent what we brought in.
We're also now in a position where Democratic support for tax cuts includes tax credits, which are so massive they now eliminate any federal income taxes for 40% of the working population. Each tax cut lowers the number of taxpayers, making the system more progressive and increasingly unstable. It also leaves Republicans open to charges of only helping the rich, as by definition, federal income tax cuts only affect 60% of the taxpayers. It's a long-term losing battle, and it's not going to get done with Obama, Pelosi, and Reid. In fact, it's more likely that Obama continues to pretend to be bipartisan, asking for $300 billion in tax credits (cleverly called tax cuts, but merely a check redistributing money from top to bottom), and Republicans get political cover for voting for the stimulus. That's not leadership and it's not opposition. It's capitulation, and the conservative base knows its coming. DeMint presents his plan, Obama counters with tax credits, and enough Republicans peel off to allow the media to call it bipartisan. Goodbye 2010 elections.
Here's a better plan. It's better because it's fresh, it's effective, it creates a center of gravity opposed to the Democrats, it's a rallying cry, and no one's done it for 60 years
Step 1: Extend the Bush Tax Cuts to 2013. That's a great idea.
Step 2: Propose Specific ways to cut the Federal Government spending by a real dollar 10%
My liberal friends laugh when I talk about shrinking the government. They rightly point out that Reagan and Bush exploded the deficit, while under Clinton, it got smaller. Regardless of the correctness of the philosophical arguments, the makeup of Congress, or the economy, voters think that Republicans equal deficit spending. And they're right.
The argument for tax cuts is they raise revenues - but if government outspends even that revenue, the limited government is to raise taxes and give less revenue to government. Republicans failed to stop government spending, and their reputation is in tatters. Until now. Obama gave us an opening. A big one.
"And to make the investments we need, we’ll have to scour our federal budget, line-by-line, and make meaningful cuts and sacrifices as well."
That's what he said. Let's hold him to it. Let's get staffers on the federal budget and start looking for waste. Let's think big. Ask for the types of cuts Gingrich asked for in 1994. Entire federal programs and maybe even a department or two can be targeted. In 1995, the Republicans were too mean, we were told. They over-reached trying to cut the Department of Education. And they blinked when Clinton shut the government down in a battle of wills.
Today, the battle is much different. The Democrats see this as their chance to fundamentally alter this country into a progressive paradise. With almost total control in Washington, things they push through could take a generation to roll back, and that's no guarantee. They seek to create permanent underclasses dependent on the governement and slavishly obedient to voting for Democrats for governmental favors.
It's time we learn something from a Democrat. Rahm Emmanuel says you "never want a serious crisis go to waste." I agree, but maybe not in the same way. The crisis is government spending more we can afford. Republicans can begin to recapture their financial mojo with a principled stand to work with Obama to do what the said he was going to do. That's right, baby. Bipartisan government focused on helping Obama eliminate wasteful government programs. This will attack earmarks, duplicative programs, jobs programs for progressive activists (ACORN, ProVote, Unions) and even wasteful military spending. Republicans can spend the next year pointing out where Obama can indeed cut government waste - not just in tiny programs, but in huge ones.
All in the name of fiscal sanity. "Republicans are trying to work with Obama to go through the federal budget line-by-line." Now that's something to rally around. The argument is we're cutting waste to make way for the needed investment in, wait for it - Roads, Bridges, and Education! That's what the Democrats say they need it for. Let's adopt their rhetoric. Let's talk about the importance of PayGo. Democrats used it to forestall criticism of spending. Let's bring it back and demand that Pelosi cut before she spends.
And you know what? It might work. Spending cuts could by law be tasked to paying down the debt or reducing the deficit. And real cuts in problems have a year-after-year effect on reducing spending. If Democrats actually did it, the country would be better off - regardless of which party did it.
Let's be honest. Obama is increasing spending with the stimulus package with or without Republican votes. He'll probably get votes as Republicans try to get along. DeMint will vote against it, but how many others?
Tax cuts are old news, and Republicans can't win arguing about a few percentage points here and there. We get our troops in line and focus on cutting so we can spend on investment. It's a winning political message because it's the right thing to do, and it's all we can do when this far in the minority. What say you?
Households across the country are being forced to cut back on their spending. Shared sacrifice means the government should be forced to tighten their belts too. For every dollar they spend, is a dollar they had to take from taxpayers. Surely we can focus on needed investment, and cut back on the nonsense?
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