Stupidest People Alive

The staff of National Review, that is.

The on-budget federal deficit--the deficit treating Social Security as a separate stand-alone entity--will in all likelihood total some $3.4 trillion over the next ten years even if all the Bush tax cuts are allowed to expire and even if discretionary spending is effectively frozen. If the tax cuts are extended--as George W. Bush dearly wishes them to be--and if real discretionary spending grows as fast as population (as it will), then the ten-year on-budget deficit estimate is some $6.6 trillion.

The editors of National Review are alarmed at the budget crisis. They call on George W. Bush to show "leadership":

Editors on Federal Budget on National Review Online: The most important ingredient at the moment, however, is presidential leadership. It has been absent for five years on spending. Bush is said to rise to the occasion when confronted with crises. He is about to confront one within his own party on spending. Let the rising begin.

And what leadership do they want him to show? Here is the National Review-endorsed deficit reduction program:

President Bush must endorse a serious, realistic set of budget offsets, and the most promising area is corporate welfare.... According to the RSC, eliminating corporate welfare would cut $5 billion in 2006 and $50 billion over ten years....

$50 billion is a small fraction--0.0076--1/132 of the projected ten-year deficit.

That is what National Review calls a "serious, realistic" approach to the budget crisis.

Stupidest people alive.

Comments

[Marcus Stanley]

They aren't stupid -- they just care a hell of a lot more about the tax cuts than about fiscal projections, and are trying to provide good political cover for making the cuts permanent. Nothing stupid about it. Now, they assume stupidity on the part of their target audience, but perhaps that is a smart assumption.

[mrjauk]

Stupides people alive? Hardly. Anybody who can pull down the kind of bucks these guys are doing by writing on something they know absolutely nothing about is a lot of things; stupid is not one of them.

[ivan]

Good idea though, eliminating corporate welfare.

[Davis X. Machina]

Reagan proved deficits don't matter.

And Jesus is coming before the T-bills mature anyways.

[bakho]

I agree. Not stupid. They have created a new discipline, Faith Based Economics. They have faith the supply side effect will kick in and miraculously increase revenues. Therefore, only minor spending cuts to programs that benefit the poor and people likely to vote for Democrats need to be cut.

[Matt Austern]

I see no sign that they believe "the supply side effect will kick in and miraculously increase revenues". More likely: they don't care, and arguments like that are for chumps. They see several different ways in which something might save the US government from fiscal collapse, and they assume, probably correctly, that in the event of a fiscal collapse they personally will be insulated from the worst effects of the disaster. They see short term benefit to themselves, and they have reasons to believe that they won't suffer much or any long term harm.

From a strict calculus of self interest, their assessment may or may not be right. I just wish it weren't my country they were doing this to.

[gcs]

"eliminating corporate welfare "
would cut $5 billion in 2006

quite a spit ball this line

1) what's your guess
at a realistic annual tab for corporate welfare ...... 150 billion ....

2) how Heepish to FEIN cutting
NR's "base klass "
but only by absurd Twisty portions

[Derelict]

I believe their approach is what's called "nibbling around the edges of the problem." The proposal doesn't stand a snowball's chance in Hell of ever getting passed. But, even if it DOES pass by some miracle, its impact is less than minimal because it will be accompanied by massive tax breaks that will more than eat up the savings.

From NRO's perspective, it's win-win-win! It makes them "sound serious," has no chance of happening, and has a worst-case outcome of just making the "targets" much wealthier.

[Rebecca Allen, PhD]

What's REALLY stupid is expecting Bush, after 5 years of corporate giveaways, to suddenly reverse course and cut corporate welfare.

[pgl]

As we noted over at Angrybear, this is about 1% of the issue with the NRO trying to pin the other 99% on the Democrats. After all, we made George Bush "do it". Unbelievable!

[Derelict]

pgl--More and more I'm hearing from my Republican/conservative friends that all the spending really is the fault of the Democrats because Democrats didn't raise a big enough stink to stop the Republicans.

Apparently the new governing philosophy of the right is that controlling all three branches of government places all responsibility for what those branches do on the shoulders of the party that is not in power. "This is all YOUR fault because you didn't stop me!"

[Brian]

Besides the fact that the numbers don't come anywhere close to adding up, why do the editors of the National Review expect a complete about-face from the admininistration? They are asking him--a president who seems to cram subsidies to every sort of industry imaginable into every kind of legislation--to eliminate (presumably) all corporate welfare. That's akin to expecting a fat person to simply decide to give up all unhealthy foods because they are supposed to realize they are overweight and hurting themselves. It's not so much moronic is it is sad and strange.

[sglover]

None of this would've happened if Dems had made sure that Bush's pen didn't have ink at bill-signing ceremonies. Really, the treachery of liberals cannot be overstated.....

[realist]

these guys know that there's really nothing to worry about, after all, the deficit will be cut in half by 2009. our president has a plan. our president has an m.b.a. from an ivy league school. he's a proven business man. he cleaned up with harken oil. he turned the iraq economy around. talk about a turn around,without him, halliburton might have gone into bankruptcy. he's doing away with welfare. hell, he's doing away with many costly social programs. with his track record of fiscal success, i know he'll go after those corporate gimmies.

[paul]

pgl and Derelict: you overlooked an additional benefit (to the GOP) of your argument. "The Clinton boom? Oh, that was due to the GOP's not interfering with Clinton's policy initiatives at the time."

[Angry Blue Planet]

"the treachery of liberals cannot be overstated"

Their cunning is vast. Allowing the Republicans to win so many elections! Allowing them to pass so many laws! The whole thing reeks of liberal conspiracy.

[Ari]

Since the tax reduction to American companies on foreign profits returned to this country was worth 100 billion dollars, I expect corporate welfare totals far more than 50 billion dollars over a decade. But, this Congress is not going to take away the likes of the 20 billion dollar subsidy to oil and gas companies for exploration or all osrts of other subsidies.

[Ari]

Also, these folks may be stupid but there will be no Republican tax increase for that would mean a Democratic Congress in the coming election.

[kharris]

Now, I'd agree that nobody who is serious about a problem proposes a solution that only addresses 1/132 of the problem and calls it a program. That is no more than an element of a program. Still, we ought to let the NRO call for a reduction in corporate welfare every day of the week. National income is skewed rather heavily toward firms (owners and high-level managers) right now, away from workers. The investor class is doing right well. Equity was eroded in a thousand ways, and will have to be restored in similar manner. By all means, let's adopt a less distorting set of corporate tax laws, and solve 1/132 of the deficit problem at the same time. And as gcs points out, using somebody else's definition of corporate welfare might net a good deal more than 1/132.

The really, really awful part is that they continue to act as if taxes are bad. Even the great Art Laffer recognized that taxes are necessary to prosperity. Taxes, as the source of operating funds for government, are good, because chaos is the alternative to government. The NRO refuses to acknowledge the reality that US tax rates are low, that the disparity in income between the rich and the poor (even the not rich) in the US is at an extreme and could be addressed through taxes without damage to general welfare, while at the same time reducing the risks of fiscal imbalance and honoring long-standing societal obligations.

So let's pick on them for the really bad stuff, and grudgingly agree with them on the good stuff that they deliver in a brainless way.

[Billmon]

Stupidest People Alive? To quote Jamie Lee Curtis in A Fish Named Wanda, "That's an insult to stupid people."

[Hedley Lamarr]

They realize that if the tax cuts are reversed the economy will do even worse. Instead of just stagnant wages and jobs, there will be stagnant corporate earnings.

Jobs at Wal-Mart, however, will still be an option for most Americans.

[pgl]

Derelict - let's blame Al Gore. His 2000 campaign was not good enough to get the most corrupt President we've ever had from coming to power. Let's also blame John Kerry who failed to stop Bush from getting re-elected. Yes, we Democrats to be blamed for letting this GOP crew stay in office. Of course, the GOP could have nominated John McCain in 2000.

[Movie Guy]

Here's the Democratic response to the RSC cut list.

House Republicans Propose Deep Cuts to Key Services to Offset Katrina Spending
Cover letter from John M. Spratt, Jr., Ranking Minority Member
September 23, 2005
http://www.house.gov/budget_democrats/analyses/06rsc_budget_options_2005.pdf

Note that the entire list of proposed cuts is also included.

Worth a review.

[s9]

realist writes: "our president has an m.b.a. from an ivy league school. he's a proven business man."

Yeah. He's now telling me that, in response to budget pressures, employees are expected to familiarize themselves with the new travel policy... that'll get the company back to profitability.

Our CEO is a goober. If this was my employer, I'd be looking for the exits.

[BroD]

"our president has an m.b.a. from an ivy league school."

and I'll bet there were better qualified applicants from te ninth ward who weren't admitted because of Yale's affirmative action program for the ne'er do well scions of rich alum. That's how we teach US-style corruption .

[Carl Remick]

The stupidest people alive aren't the people who write the National Review but the people who read it.

[bakho]

Spratt is a smart guy. The Dems need to do a better job of getting his messages in front of the cameras.

[a different chris]

Carl Remick - word.

>and grudgingly agree with them on the good stuff

Actually, in this case we should not be grudging but grab the thing and run for glory with it. Yeah, it doesn't mean spit to the budget debacle, but it's a good in its own right so what the hell. We who are semi-represented by the Democratic Party don't have much meaningful that we can accomplish at this point, you know.

The trick to politics is to get people on TeeVee saying something new but that rings true to a lot of people. Once a face is associated with new-but-reasonable thinking, then said face can move left (or right, as has been the Rethug trick) and still be listened to. Anti-corporate welfare is a good banner to ride in under.

[No von Mises]

MM is right.

NRO is playing on the notion that the overwhelming majority of people have not seen the deficit affect their lives negatively. Yet, they know it exists and believe that being in the red, like households, is not good. But then prosperity has risen since 1980, so there lies the conundrum. Hence, cautioning corporate welfare is a PR move that capitalizes on two entities that are popular political punching bags- the deficit and corporations.

That bastard Cheney was right- deficits don't matter. And that bastard will now publicly say they do matter, so he can take out his saber and strike down $50b of a trillion dollar international financial ponzi scheme confidence racket. Yah!

[Bruce Webb]

Marcus nailed the central point right in the opening comment. Whether talking taxes or Social Security our side (whether you define that as Democrats/Leftists/Progressives/Reality based) looks at the term "policy debate" and sees "POLICY debate" where the other side sees policy DEBATE". That is we tend to focus on outcome while their focus is entirely on winning in the here and now.

I made this point at Ezra and won't belabor it. The very worst fear of the Right is that a governmentally based solution, whether to health care or retirement security, will be shown to be the optimal one. These people aren't into five stage progression, they will forever be stuck in denial and anger, because they can't sustain acceptance of government solutions. It destroys their whole whole view. They would rather take the nihilistic path of budget meltdown rather than admit Ayn Rand and Uncle Miltie just got it wrong.

[Davis X. Machina]

"If this was my employer, I'd be looking for the exits."

Can you still register the domain name fuckedcountry.com?

[DK]

The problem with NRO's brand of supply siders is that they've forgotten the Laffer Curve is a _curve_ -- yes, for some high tax rates, tax cuts will increase revenue. But if you continue cutting, you will eventually hit a maximum revenue and you will then see revenues decrease.

The NRO seems to think the Laffer Curve has been replaced with the Laffer Hyperbola, with zero taxes leading to infinite revenue.