by Linda Beale
The GOP likes to pretend to take the high road, proclaiming itself to be against increasing the federal debt, running big deficits, or otherwise not running our government like a person runs their household. Pundits on the right tend to look at Greece and warn–watch out, America, you’re gonna be there next.
Of course, there’s a big difference in a family on a limited budget and the federal government. The government can print money to pay its bills; when people do that, it’s called counterfeiting. The amount of quantitative easing is limited, though where the limits are difficult to establish with any certainty–at some point. And there’s a big difference between the US and Greece. Unlike Greece, we have a sovereign money supply (Greece is tied to the European Union, unless it decides to break away and suffer the consequences). And unlike Greece, though our debt is high, it is still only about 70% of GDP. And lucky for us, the foreign nations who buy our debt need somewhere to put all those dollars that they’ve acquired through their cheap exports to us.
There’s another big difference between the US and Greece. We have a long history of a stable and workable tax system–in spite of the frequent tinkering that Congress has done over the years. We have at times had politicians in office who recognize their responsibilities to the system and enact new tax laws, in spite of the intense lobbying by Big Business and wealthy interests to try to derail all tax increases. We can and should increase taxes now, especially on those most able to pay.
So is that what the GOP candidates are proposing, after all their whining about how Democrats are fiscally irresponsible and blaming Obama for increasing our debt load? Nope, not at all. Except for Ron Paul, who wants to harshly cut every government activity, the rest of the GOP candidates have enormous tax cuts and middling spending cuts (mostly to programs that benefit ordinary Americans) and would add to the deficit by trillions of dollars, according to the Committee for a Responsible Federal Budget. See Primary Numbers: The GOP Canddiates and the National Debt (Feb. 24, 2012). Gingrich would have the biggest increase–about $7 trillion in new debt over a two-term presidency. Santorum would increase the debt by about $4.5 trillion, and Romney would increase it by about $2.6 trillion (unless he really comes up with some offsets as promised). All three of them are likely depending on the laughable Laffer Curve idea to help them achieve their promises–the assumption that their tax cuts for the wealthy would result in more growth and therefore more tax revenues.
crossposted with ataxingmatter