Sunday, June 5, 2011

Debt and Taxes

Let’s keep it simple. Where the national debt’s concerned, debt and taxes are intrinsically linked.I found a revealing data set on Wikipedia here. Wikipedia derived the data I show in part from the Congressional Budget Office, in part from a White House FY 2011 Budget tabulation. What I’m showing is the percentage change in national debt between the beginning and the end of each presidential administration. I’ve augmented the data by filling out the chart so that it reflects results for the Obama Administration up to the present time. Herewith is the graphic.

Except for a tiny increase in debt in the Second Nixon/Ford Administration, all administration until Reagan produced decreases in national debt. The red bars start thereafter, Reagan kicking things off. The sole deviation from that pattern came with the two Clinton administrations—where the debt once more dropped.

Red is the Republican, Blue the Democratic color signature. Forgive me for choosing these colors to show the results. Red shows increases in debt, blue decreases. And since Reagan they match the parties. To be sure, three different Republican administrations managed to cut the debt—and to identify them I put a little red in the blue. Seven Democrat administrations managed to cut the debt, Obama’s has not—and therefore I put a little blue in Obama’s red bar.

Quite consciously and deliberately, the Reagan administration let debt accumulate thinking that as it climbed, it would ultimately force cuts and a shrinkage of government. The administration miscalculated. Both parties have powerful urges to reward their respective constituencies. Democrats must spend on social programs to do so; Republicans can only do so by cutting taxes. But Republicans are also motivated to spend—at least on the military-industrial complex; and this urge is also basic and understandable. But the standoff that has developed is beginning to look irresolvable by courteous compromise. Troubling.

Where I come out is that Republicans should not try to hand money to their wealthy constituents by tax cuts—who don’t really need the help. I for one have always delighted in paying taxes—and the more the better. It meant that I was doing better. Then, by compromising on taxation, Republicans can ensure adequate spending on the military.

Real leadership for this sort of compromise must come from the right. The ordinary people must have jobs, healthcare, and schooling—and for this we can’t rely on that bloody Hidden Hand. Where are the genuine aristocrats among Republicans? Traditionalists who understand that nobility obligates—whatever name we call it: virtue, talent, power, wealth. If we all start acting like proles, Katie bar the door.

1 comment:

  1. Man, this makes it all too clear. Cutting taxes has simply never been the solution and is, in fact, the problem that has lead to our indebtedness.

    Wonderfully clear and informative!