Feb 10th, 2012
It has been a remarkable experience over the last year or so watching the economic team Ronald Reagan assembled three decades ago mount increasingly passionate attacks against contemporary GOP orthodoxy (examples HERE, HERE, HERE, HERE and HERE).
The two most prominent figures waging this battle are David Stockman and Bruce Bartlett. Both men recently sat down with Bill Moyers to continue their push for a return to reason.
David Stockman on Taxes from BillMoyers.com on Vimeo.
Bruce Bartlett on Where the Right Went Wrong from BillMoyers.com on Vimeo.
Showing posts with label Reaganomics. Show all posts
Showing posts with label Reaganomics. Show all posts
Friday, February 10, 2012
Friday, February 3, 2012
Bruce Bartlett And The Ghost Of Reagan
Feb 3rd, 2012
Throughout the GOP primary season, the supposed legacy of Ronald Reagan has been invoked by the hopefuls a stunning number of times. It has occurred to me that this endless collection of promises to somehow re-institute the past exposes a pretty poor grasp of actual economic history. But why take my word for it when you can hear it from Bruce Bartlett?
"Judging from the candidates’ tax proposals, they seem to believe that the most Reagan-like candidate is the one with the biggest tax cut. But, as the person who drafted the 1981 Reagan tax cut, I think Republicans misunderstand the premises upon which Reagan’s economic policies were based, and why those policies can’t — and shouldn’t — be replicated today." EMPHASIS OURS
Throughout the GOP primary season, the supposed legacy of Ronald Reagan has been invoked by the hopefuls a stunning number of times. It has occurred to me that this endless collection of promises to somehow re-institute the past exposes a pretty poor grasp of actual economic history. But why take my word for it when you can hear it from Bruce Bartlett?
"Judging from the candidates’ tax proposals, they seem to believe that the most Reagan-like candidate is the one with the biggest tax cut. But, as the person who drafted the 1981 Reagan tax cut, I think Republicans misunderstand the premises upon which Reagan’s economic policies were based, and why those policies can’t — and shouldn’t — be replicated today." EMPHASIS OURS
It doesn't get much harder to argue for a return to Reaganomics when one of its principle architects declares the proposition to be ridiculous. Inflation was generally agreed upon in those days to be the biggest threat to growth. In the intervening years, our economy has been so transformed that we've managed to ride out the worst crisis since the 1930s without much inflationary instability at all.
Saturday, April 16, 2011
Maybe Ryan Really IS Through The Looking Glass
April 16th, 2011
In economics there is the theoretical future and the provable past. It's generally wise to base proposals for that future on what we have learned so far. Rep. Paul Ryan's (R-WI) Path To Poverty is most striking in it's devotion to philosophies that we know to be destructive and ineffectual. Take a look at the cost-benefit analysis across a variety of forms of deficit spending. Make no mistake, the tax cuts called for in the "Path" are deficit spending.
The Ryan plan seems to take these facts and literally flip them. Every proposal he describes as most stimulative has been proven to be the least likely to spur growth. Everything he has targeted for elimination has the greatest immediate benefit to the economy. The problem for Ryan is that he just doesn't like these facts. As Tim Tankersley and Katie O'Donnel of the National Journal observed, the Ryan Plan is predicated on a faith in "bedrock principles of supply-side economics."
Which is how we got here in the first place.
In economics there is the theoretical future and the provable past. It's generally wise to base proposals for that future on what we have learned so far. Rep. Paul Ryan's (R-WI) Path To Poverty is most striking in it's devotion to philosophies that we know to be destructive and ineffectual. Take a look at the cost-benefit analysis across a variety of forms of deficit spending. Make no mistake, the tax cuts called for in the "Path" are deficit spending.
The Ryan plan seems to take these facts and literally flip them. Every proposal he describes as most stimulative has been proven to be the least likely to spur growth. Everything he has targeted for elimination has the greatest immediate benefit to the economy. The problem for Ryan is that he just doesn't like these facts. As Tim Tankersley and Katie O'Donnel of the National Journal observed, the Ryan Plan is predicated on a faith in "bedrock principles of supply-side economics."
Which is how we got here in the first place.
Monday, April 11, 2011
The Paul Ryan Pamphlet Part 2 - Defense
April 11th, 2011
by F. Grey Parker
Having examined Rep Paul Ryan's (R-WI) Path To Poverty in some detail, it's been frustrating watching so many rightist partisans and pundits respond by lavishing praise upon its "seriousness." My first critique, focusing on the tax implications alone, argued that it is largely removed from economic science as we know it.
It was satisfying to see Paul Krugman say much the same thing and for the same reasons a few of days later. He does, after all, have a little more experience reading budgets than I do.
"They should have waited until people who know how to read budget numbers had a chance to study the proposal. For the G.O.P. plan turns out not to be serious at all."
by F. Grey Parker
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| © copyright 2011 S. Harris |
It was satisfying to see Paul Krugman say much the same thing and for the same reasons a few of days later. He does, after all, have a little more experience reading budgets than I do.
"They should have waited until people who know how to read budget numbers had a chance to study the proposal. For the G.O.P. plan turns out not to be serious at all."
Tuesday, April 5, 2011
The Paul Ryan Pamphlet Part 1 - Taxes
April 5th, 2011
by F. Grey Parker
My first reaction when I finished reading The Path To Prosperity, Rep Paul Ryan's (R-WI) highly anticipated "budget," was to wonder where the rest of it was. It's like an introduction without a following body of work. The calculated lack of specificity is stunning. It's a buffet of political talking points.
There are certainly many scary charts, spooky graphs and a lot of Neo-Con think-tank phrases. But to call it a "budget" is an insult to arithmetic itself. In fact, at his press conference earlier this afternoon Ryan said it "is not just a budget, it’s a cause." With all due respect, faith doesn't secure the outcome of financial equations.
by F. Grey Parker
My first reaction when I finished reading The Path To Prosperity, Rep Paul Ryan's (R-WI) highly anticipated "budget," was to wonder where the rest of it was. It's like an introduction without a following body of work. The calculated lack of specificity is stunning. It's a buffet of political talking points.
There are certainly many scary charts, spooky graphs and a lot of Neo-Con think-tank phrases. But to call it a "budget" is an insult to arithmetic itself. In fact, at his press conference earlier this afternoon Ryan said it "is not just a budget, it’s a cause." With all due respect, faith doesn't secure the outcome of financial equations.
Let's look at the Ryan scheme:
"Keeps taxes low so the economy can grow. Eliminates roughly $800 billion in tax increases imposed by the President’s health care law. Prevents the $1.5 trillion tax increase called for in the President’s budget. Calls for a simpler, less burdensome tax code for households and small businesses. Lowers tax rates for individuals, businesses and families. Sets top rates for individuals and businesses at 25 percent. Improves incentives for growth, savings, and investment"
"Keeps taxes low so the economy can grow. Eliminates roughly $800 billion in tax increases imposed by the President’s health care law. Prevents the $1.5 trillion tax increase called for in the President’s budget. Calls for a simpler, less burdensome tax code for households and small businesses. Lowers tax rates for individuals, businesses and families. Sets top rates for individuals and businesses at 25 percent. Improves incentives for growth, savings, and investment"
Taxes are at their lowest levels in modern history and have been for years. There has been no corresponding expansion of the economy. What's more, the $800 billion in prevented "tax increases" he touts is predicated on the complete repeal of HCR. That is not going to happen. There is no demonstrably broad benefit to the U.S. economy from the hyper-wealthy having a tax rate of 25%. A 10% drop in the corporate rate with not one single loophole singled out for elimination is ridiculous.
We have to substantially raise taxes and soon. I say it. Krugman says it. Reich says it in no uncertain terms. In fact, a majority of Americans say it. And yet, Ryan skips merrily through an alternate reality.
Ryan actually cites economic projections from the Heritage Foundation as supporting data within the plan itself. The same Heritage Foundation that said "pro growth tax cuts... always create jobs" while arguing for the extension of the disastrous W Tax Cuts that didn't create jobs. As a matter of fact, the weakest ever post-Depression job creation accompanied that fiscal policy. Of course, that's not what Heritage had projected prior to their initial implementation. Matt Yglesias dug up this gem today.
Heritage prosperity projections that they insisted would follow passage of the W Tax Cuts...
The entire payroll expansion under W came to 2.3% which is almost six times smaller than the expansion rate under just 4 years of Jimmy Carter! Ryan's plan is a larger dose of the same failed "stimulative policies" which have caused this mess. But by all means, let's assume that Heritage is totally correct... this time.
The subject of our revenue in-stream is carefully packaged alongside political triggers designed to provoke panic:
"As economic growth deteriorates, it becomes harder for the government to raise revenue through taxes, and a vicious cycle ensues. If the nation ultimately experiences a panicked run on its debt, it will be forced to make immediate and painful fiscal adjustments (like the austerity program that has provoked riots in Greece)"
America/Greece comparisons are absurd. They are also dishonest. The crisis in Greece was caused by two principal factors. The first is that their economy was so much smaller than ours and not complexly diversified. The second is that they invested their national treasure heavily in our own under-regulated derivatives markets. These are the same markets that Mr. Ryan doesn't want to "over-regulate."
The entire payroll expansion under W came to 2.3% which is almost six times smaller than the expansion rate under just 4 years of Jimmy Carter! Ryan's plan is a larger dose of the same failed "stimulative policies" which have caused this mess. But by all means, let's assume that Heritage is totally correct... this time.
The subject of our revenue in-stream is carefully packaged alongside political triggers designed to provoke panic:
"As economic growth deteriorates, it becomes harder for the government to raise revenue through taxes, and a vicious cycle ensues. If the nation ultimately experiences a panicked run on its debt, it will be forced to make immediate and painful fiscal adjustments (like the austerity program that has provoked riots in Greece)"
America/Greece comparisons are absurd. They are also dishonest. The crisis in Greece was caused by two principal factors. The first is that their economy was so much smaller than ours and not complexly diversified. The second is that they invested their national treasure heavily in our own under-regulated derivatives markets. These are the same markets that Mr. Ryan doesn't want to "over-regulate."
What actually makes it "harder for the government to raise revenue through taxes," is cutting taxes, allowing rampant loophole abuse and refusing to impose taxes in the first place.
The obvious initial steps towards solving our problems are as follows; Expire the W Tax Cuts, return the highest marginal individual rates to Eisenhower Era levels and set the top corporate tax rate on profits at a flat 15% with no loopholes.
Describing Ryan's collection of fantasies as Reaganomic nonsense, which I did earlier today, is actually unfair to the Gipper. When President Reagan was confronted with the destructive and unsustainable reality of tax rates that were substantially higher than today's, he signed bills into law which raised them 7 times.
One must wonder. If Rep. Paul Ryan and his ilk were presented with an actual Reagan budget today, would they portray it as "progressive?"
This "Path" isn't conservatism. It's corporatism. It's less Jefferson than it is Mussolini.
Wednesday, March 30, 2011
Quote Of The Day - Reaganomic Endgame Edition
March 30th, 2011
"Conservatism cannot be defined as whatever is the most extreme right-wing narrative of the moment. Time matters. Conservatism needs to be flexible enough a governing philosophy to be able to correct for conservative ideology itself. When such an ideology threatens fiscal balance, a prudent foreign policy, and a thriving middle class, it has become the enemy of real conservatism, not its friend." -- Andrew Sullivan
"Conservatism cannot be defined as whatever is the most extreme right-wing narrative of the moment. Time matters. Conservatism needs to be flexible enough a governing philosophy to be able to correct for conservative ideology itself. When such an ideology threatens fiscal balance, a prudent foreign policy, and a thriving middle class, it has become the enemy of real conservatism, not its friend." -- Andrew Sullivan
Wednesday, February 16, 2011
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