The Redhunter

2a) Because of the stimulus package, to create jobs, to prevent another Great Depression. (cf. John Maynard Keynes)

3a) Republicans don't mind running deficits for stuff they like, such as (during the Bush years) wars and tax cuts. Democrats have a similar tendency, but for green jobs and healthcare. Go figure.

4a) The 2009 deficit is big because of a) the tax revenue shortfall caused by the financial crisis and b) see 2a)

5a) Repeat as needed.

TRH,

I am w/ Mylne on this. I will not comment on how we got here or on the Bush administration's responsibility b/c you can't put the toothpaste back in the tube. I have always found the deficit a matter of concern and of even more concern is the fact that the PRC now practically owns this country. The only saving grace of that issue is the Chinese are smart enough to know that they are riding on the tiger's back. Nevertheless, do you think the Chinese would have tx'd the President w/ such disrespect at Copenhagen if they were not holding such an enormous amount of our debt?

Indeed the only way out is for the economy to turn around on the grass roots level thereby increasing tax revenues.

For all of those Tea Baggers out there, I throw down the gauntlet. Where do you want to cut spending? W/o the bailout, this country would have plunged into depression dragging the global economy w/ it

But if or when the new moon mission is scrapped, 450 well paying jobs w/ Lockheed martin in Colorado are going to disappear.

Somehow, the GOP thinks it can soothe the beast w/ that same old mantra "Cut taxes! Cut Taxes! Cut taxes for the rich most of all!"

As a recently deceased former partner of mine once remarked, "That dog won't hunt."

I understand the anger out there. I feel it myself. It is not beyond the realm of possibility that the local school board, which has frozen my spouse's wages for two years and dramatically increased the cost of our benefits, will cut her program from the district's curriculum so she may lose her job even though she is tenured.

If that happens, our family is in for more hard times. Two of us have "preexisting medical conditions. COBRA premiums are outrageous and after 18 months. if we cannot get on another group policy, those conditions will not be covered for year. But hey, "We don't need no stinkin' health care reform."

So for all the "fiscal conservatives" out there, many whom understand how our economy works about as well as they understand Farsi, I am waiting for concrete solutions although I may as well be waiting for Godot.

TLGK

I grow tired of this subject because what really needs to be discussed is what will we cut and how much more in taxes will we have to pay.

The economy will never grow enough to increase tax revenues to where deficits can be reduced. Get real. Social programs will not be cut. Obama raised defense spending. That's the biggest social program we have. Millions of jobs depend on the defense industry.

I'mm partisan as anyone Tom. But unless God intervenes and Jesse Ventura is elected president along with a hoard of like thinking people to Congress, deficits will grow until we are at a status similar to India.

If you have some good news I'd love to hear it Tom. Just save us the nonsense about spending cuts that will never happen because government spending cuts means cutting jobs. How will cutting jobs increase employment? We're all intertwined.

I'm going to make this real simple - Obama increased government spending by a fantastic amount and none of it was necessary, period.

He - didn't - have - to - increase - spending !!!

Bush didn't have to increase spending on non-defense items, either. Conservatives criticized him and the GOP congress bitterly over it at the time, too. We hated it when Bush did it and hate it when Obama does it more.

I think the bailout (TARP) was a mistake. We should have let them go under (GM included) and taken our lumps at the time. The medicine would have been rough, but nowhere near as bad as the situation today. It would have also taught business that if you screw up you go under! One problem with bailouts is that it teaches the wrong lesson; that you can be careless and fail at business but no worry! because the government will bail you out.

Obama has hiked up the deficit by a fantastic amount. And that doesn't bother any of you? The idea that our current deficits and levels of spending are normal, natural, and inevitable is utter nonsense. The stimulus was completely unnecessary and has done absolutely no good.

The stimulus was 1) a payoff to Democrat constituency groups and 2) an attempt to increase dependency on the government. The purpose of both was to A) permanently increase the size and power of government (thus moving us to a Western European style system) and B) create more Democrat voters. It had nothing to do with the economy. Very little of it went to "shovel-ready" projects. Even so, Keynesian economics (demand side) doesn't work anyway.

As for cutting taxes, look up "Laffer Curve" and "Supply Side Economics" It worked in the 80s and it will work again. We are currently too far to the right on the Laffer curve, so cutting marginal tax rates, especially at the higher levels, will increase revenue. Clinton could get away with a small rise in taxes because at the time we were to the left of the hump on the curve.

But even if you can't stomach increasing the size of the economy and thus tax revenue through supply side economics, we must stop increasing government spending!. This is one reason why the American people have so utterly rejected the Obama-Pelosi-Reid healthcare proposals - because they will cost a zillion dollars and not increase coverage one bit.

Spending on Defense has been going down down down these past two decades, both as a percentage of GDP and federal spending. The amount Bush increased defense spending was minuscule. See my post here which lists defense spending year by year from 1945 to the present day.

Further, far from increasing defense spending, Obama is cutting defense spending to pre-9/11 levels

If you do want a place to cut government, though, let's start with the Department of Education. Toss it all out the window and let the States do all of it.

I can't speak for your school board, TLGK, but here in Loudoun County they spend an insane level of money on the schools, giving them every luxury known to man. They have guidance counselors in the elementary schools and teachers assistants up the wazoo. It's a big jobs program for liberals. Step increases in pay every year, of course. And this in a profession that gets two months off in the summer and every other holiday in existence. We're running a $191 million deficit this year (out of $1.4 billion budget), and their solution is to hike property taxes in a recession! Worse they are projecting even higher deficits on out. The Democrats who control the BOS are just asking to be voted out of office. Maybe it's different where you live, though. As I said, I'm only speaking for LC.

Obama - One Term!

Face the facts, guys, the American people are catching on. Obama is going down - down - down in the polls and Republicans are winning elections, and the deficits and massive government spending are key reasons why.

So, Tom. You think we just should have left well enough alone? We should have let Detroit and all the businesses connected w/ the American automobile industry go down the tubes? Yes, bonuses for bankers nauseate me, but do you actually think we just should have let the banking industry fail?

You know what the real problem is? The GOP leadership wants to return the country to feudalism and you will be their happy serf.

The economy is in the toilet b/c of Republican inaction. By the way, I just saw The Committe for Truth in Politics latest slickly produced commercial which sends the message that reforming the banking industry favors the bureaucrats and lobbyists.

I fully expect the GOP to play the fear card. After all, when you have a party filled w/ morally and intellectually bankrupt regionalists, what else do you have to play?

And if the GOP again gains control, what can we expect? More tax cuts, most of which will favor the wealthy. That will reduce the deficit, won't it.

The good news is that if things turn bad for you personally, your congregation will probably take care of you. Your political party won't give you the time of day.

TLGK

It's interesting that now, over a year after the financial crisis, you are blogging that TARP was unnecessary. I do not recall you saying this at the time. Your blog in 2008 mainly mentioned sound-bite controversies from the campaign and military issues - there was a deafening silence as to what should be done about failing banks.

In fact it was difficult to find any credible libertarian economist (not even Alan Greenspan!) who didn't think bailing out the banks was necessary. That was then.

But now the same old GOP talking points have been dusted off. America's economic problems have been caused by the deficit (in fact it's just the opposite). Cutting taxes will always stimulate growth, in any situation. Your statement that you know where we are on the Laffer Curve sounds like an article of faith - what is your evidence?

As for defense spending vs education...fine. You think fighting wars is more important for America's future than investing in education. When the public sector employs soldiers and mercenary contractors, this is necessary and patriotic. But when it employs schoolteachers it is pork-barrel cronyism. Hmm...

You still haven't particularly made the case for why military spending should lie outside the realm of fiscal discipline. As Truth 101 often points out, Great Powers need to make sure they can afford their military spending - isn't imperial overreach a common lesson of geopolitical history?

Oh for gods sake, Mylne, READ MY LAST COMMENT. To say that military spending is outside fiscal discipline defies all history. If you follow the link I set up above you'll see that military spending has gone nowhere but down these past few decades. And I mean down in inflation-adjusted dollars, as a percentage of the budget and GDP.

On the other hand, payments to the teachers unions (mis-called "education spending") has gone nowhere but up. So much of "education spending" has nothing to do with educating children but again is a big jobs program for liberals to swell the public sector and thus create Democrat voters. Spending on eduction goes up but the results are flat. Demagogues on the left though would have you believe that unless you fund their massive programs year after year you are starving the children etc.

I live in the wealthiest county in the US of A, so tax revenues are clearly not a problem, but the Board of Supervisors still can't balance the budget. Meanwhile, 75% of our budget goes to the schools, which is way out of whack with surrounding counties and the rest of the U.S.

The bottom line is that we want free ice cream for everyone in this country and we've got to learn we can't have that.

I and other conservatives said time and again during the Bush years that he and the Republicans in Congress were spending too much money. Bush was bad, but Obama is bad on steroids. That Bush and the congressional GOP spent too much money is no excuse for Obama to do likewise.

"Cutting taxes will always stimulate growth, in any situation.

NOWHERE DID I SAY THAT NOR DOES ANY CONSERVATIVE SAY THAT - Look up "Laffer Curve" before you write such nonsense again.

I know what the Laffer curve is, thanks. What I meant is that, despite conceding a hypothetical situation where tax cuts will not stimulate enough growth to increase government revenue, the GOP has never actually admitted that the economy might be in such a situation. There's invariably a gut instinct that a tax-cut would probably help.

I cannot comment on the situation in your home county. But which way do you want to have it? Either your local situation is an anomaly, "way out of whack... with the rest of the US", or it is representative and therefore valid to extrapolate from. You can't have it both ways.

Your figures on defence spending do not include the cost of the wars in Iraq and Afghanistan. If you don't count my binge trips to Vegas four times a year I have been keeping my gambling habit in check recently.

Thanks for leaving your comments, everyone. I've made my points and we're not going to convince each other anyway. As always I give my guests the last word.