| Thursday,
April 14, 2011 The
Budget Debate
The radio, the Web, and the newspapers are all filled with tirades,
discussions, cheers, denunciations, and comments on the
President's budget speech. The general consensus is that it was a line
in the sand, a defining moment: the Obama agenda is the Socialist Agenda,
much of it drawn from classic theoretical socialism, not the American
pragmatic socialist agenda of Norman Thomas (most of which has long been
fulfilled and indeed accepted as part of "normal" American values) but the
more extreme views of inevitable class warfare stemming from the European
intellectual elite. It draws much of its theory from the intellectuals of
the English Fabian Society; a great deal of that has been adopted by the
organizations like ACORN, the community and neighborhood organizers whose
agenda basically consists of agitating for more money, ostensibly for their
neighborhood clients, but in practice for the organizers who will be their
leaders.
Under the Obama Plan, the federal government will consider taking 24% of
the GNP as "normal". Many of us do not accept the current 20% as something
we can live with; we think it is too high, and was generated largely by Cold
War and other wartime needs. In my judgment 10% for the federal government
is too much. If we need more government taking more money and furnishing
more services, that is the mission of the states, even the counties, not of
Washington. Get the Feds out of our lives, don't give them even more power.
That is, I think, the view of most conservatives, and the major differences
we have with the libertarians is that they think even that 10% is too large.
As to how I come up with 10%, I mostly rely on the data and reasoning of C.
Northcote Parkinson, who was, in my judgment, one of the great thinkers of
the 20th Century. He wrote well and humorously, and his humor and satire
caused him not to be taken seriously by many intellectuals. In fact, his
arguments are quite sound and based on historical research even though they
are presented humorously. His conclusion is that in peace time 10% is about
what you're going to pay to the government. Alas, he was speaking of the
English system, which doesn't have all the layers we have in America; if we
can hold the Feds to 10% there will still be welfare demands that the States
will have to meet, and they'll be added to the tax demands.
I'm more than willing to debate the questions of just what we ought to do
for ourselves and what we ought to leave to government; but I don't think
there is a lot of justification for more than 10% of GDP going to the
Federal Government in peace time. It just won't spend more than that wisely.
And yes, I understand that there is a lot of room for debate on whether the
Federal Government can spend even 10% of the GDP wisely; but leave that for
another day. The fundamental question has now been raised: should the Feds
have more than the 20% it now considers "normal" or should the goal be to
reduce that number? That is what the next election will be about. Nothing
else short of war is going to be that important.
For those interested in Parkinson's analysis, the book is The Law and
the Profits, published in 1960, and it is as readable today as it was
then -- except that when it was published things had not gone as far as they
have. It is, despite his humorous presentations, quite serious.
Incidentally, those who have not read Parkinson's Evolution of Political
Thought, an intellectual history of civilization, are in for a treat.
This is a serious work written seriously, but Parkinson's delightful style
comes through.
The Law and the Profits presents Parkinson's second law:
Expenditure rises to meet income. In Parkinson's time that was a
reasonable statement, which itself should be a warning: in the 21st Century
the formulation should be "Expenditure rises to exceed income." It also
needs to be coupled with Pournelle's Iron Law
of Bureaucracy, which states that bureaucracies will always be
controlled by people devoted to the welfare of the bureaucracy rather than
to its goals.
Today's Journal has a number of worthwhile articles. Begin with "Obama's
Soak-the-Rich Tax Hikes Won't Work", (link)
which has a lot of data to support his contention that
President Obama's response to congressional
efforts to curb runaway federal spending is to emphasize, once again, his
resolve to greatly increase tax rates on married couples whose joint
incomes are above $250,000. This insistent desire to raise taxes—which he
repeated in a speech yesterday while complaining about "trillions of
dollars in . . . tax cuts that went to every millionaire and billionaire
in the country"—is a distraction. It won't solve our nation's fiscal
problem.
Preliminary estimates from the Congressional
Budget Office (CBO) project that federal spending under the president's
2012 budget plan would average 23.3% over the coming decade—up from 19.7%
in 2007 and 18.2% in 2001.
Obama's deficit plan is to continue the expenditures while raising taxes
on the rich. His speech was most standard class warfare soak the rich
rhetoric. The rich aren't doing their share, and look at those pathetic
people over there that you are going to allow to die in misery so those rich
bastards will have money to invest. Trust me. I'll spend it better than they
will.
There is also a Wall Street Journal editorial on the President's speech,
"The Presidential Divider" (link)
which begins
Did someone move the 2012 election to June 1?
We ask because President Obama's extraordinary response to Paul Ryan's
budget yesterday—with its blistering partisanship and multiple
distortions—was the kind Presidents usually outsource to some junior
lieutenant. Mr. Obama's fundamentally political document would have been
unusual even for a Vice President in the fervor of a campaign.
There is more:
Mr. Obama did not deign to propose
an alternative to rival Mr. Ryan's plan, even as he categorically rejected
all its reform ideas, repeatedly vilifying them as essentially un-American.
"Their vision is less about reducing the deficit than it is about changing
the basic social compact in America," he said, supposedly pitting "children
with autism or Down's syndrome" against "every millionaire and billionaire
in our society." The President was not attempting to join the debate Mr.
Ryan has started, but to close it off just as it begins and banish House GOP
ideas to political Siberia.
It's all bracing for those who agree with them. It does make
one point about deficit reduction by raising taxes on the rich:
Under the Obama tax plan, the Bush
rates would be repealed for the top brackets. Yet the "cost" of extending
all the Bush rates in 2011 over 10 years was about $3.7 trillion. Some $3
trillion of that was for everything but the top brackets—and Mr. Obama says
he wants to extend those rates forever. According to Internal Revenue
Service data, the entire taxable income of everyone earning over $100,000 in
2008 was about $1.582 trillion. Even if all these Americans—most of whom are
far from wealthy—were taxed at 100%, it wouldn't cover Mr. Obama's deficit
for this year.
As Lady Thatcher once observed, the trouble with socialism
is that you run out of other people's money. Socialism assumes that
productivity will continue, and people will work because they want to work,
and while there will be loafers and free loaders there will not be many.
After all, it worked in Scandinavia, didn't it? People didn't game the
system. And it certainly did, for generations. Whether it still works so
well isn't as clear, and whether it will work in a society that didn't start
with The Protestant Ethic as an iron rule among industrious people is
definitely worth discussion and debate -- not that there is likely to be any
serious discussion or debate. The Welfare State has not fared so well in
Spain and Greece. In any event, in the Unites States one would think the
proper level for such experiments would be the States, which can tailor
programs to local needs and abilities, not to a Federal Bureaucracy. I note
in passing that changing local Civil Defense which worked pretty darned well
to a Federal Emergency Management Agency is a very good example of just what
happens when you try to federalize a government service.
Obama has made it clear: the stakes are the meaning of
America. Nothing more an nothing less. Are we a nation of states, or are we
a Welfare Nation? The deficit debate is about that: nothing more and
nothing less.
=================
The Birther Joke Ought to be Over
I have to say that I was amused by Donald Trump's bringing
in the birther debate as a way to get noticed, but I fear he has carried the
joke too far, and I'm not going to play along with it any more. If it has
not been clear from the beginning, let me make it clear that my view is that
it's all moot, and has been since the electors cast their votes for
President; certainly since the inauguration. It is possible but not likely
that had it become clear after the electoral college votes were opened in
the House but before the inauguration that Obama was really born in Kenya,
President Bush could have prevented the installation of the new President
and ordered a new election. It would have been a disastrous decision, but it
was at least possible.
Once Obama was sworn in he was President, and the Army had a
new Commander in Chief, and no writ runs against a sitting President other
than a formal impeachment. The courts have no place in such a constitutional
crisis. Any marshal sent by the judiciary to arrest a sitting President had
better find a way to get past the Washington garrison. The marshals will
need anti-tank weapons. SWAT uniforms won't do. They will have to recruit
one of the Legions.
Deposing a sitting President is an act of civil war. The
United States does not need another civil war. Trying to prosecute a
retiring President for political crimes is another step toward civil war:
Gerry Ford acted properly and courageously in granting Nixon a full and
complete pardon, sparing the nation that divisiveness. We ought to make that
part of the Constitution: the Congress may impeach a former President, but
absent that he remains in a state of political grace. But that's for another
discussion.
Today's Wall Street Journal has an article "The GOP and the
Birther Trap" by Peter Wehner (link)
that is worth reading for anyone who still takes the birther debate
seriously, or even finds it amusing. He's right: there is a big downside to
playing that game. It was a fun game, but too many took it seriously. We
need to find another joke.
By focusing on Mr. Obama's birth
certificate, Mr. Trump has garnered a lot of attention and some support.
According to the latest CNN/Opinion Research Corporation survey, among
Republicans he is now tied with Mike Huckabee as the most popular
prospective GOP presidential nominee. If responsible Republicans don't speak
out immediately against Mr. Trump's gambit, it will do substantial damage
both to their party and to American politics.
Wehner goes on to refute Trump's arguments, and perhaps he
does so: but in my judgment the very debate is unimportant. It no longer
matters. If we found irrefutable evidence that Obama was born in Kenya, it
would not matter. The House will not impeach him, nor the Senate
convict him, for being born in Kenya. He is President and Commander in Chief
until January 2013. Get used to it.
==========
For those who are alarmed that the Daiichi catastrophe
rating is now on a par with Chernobyl, be of good cheer. It's not really on
a par with Chernobyl. I said it early on, and I continue to say: it ain't
Chernobyl. It's a lot closer to TMI than Chernobyl. If you want to know more
on that, see http://mitnse.com/ from the
MIT Department of Nuclear Engineering.
======
I put it up last night at midnight:
there is considerable interesting mail. I will have more mail
later, but I have to eat lunch and get back to my taxes. Roberta is much
recovered, and we had a short walk this morning, much to Sable's delight.
Things are returning to the normal state of chaos in Chaos Manor. Thanks to
all who have sent their good wishes and prayers, and thanks also to all the
new subscribers. We can use more. If
you've been thinking of subscribing but
haven't just yet, this would be a great time to do it.
I'll have more mail later this afternoon. Keep writing. I do
read just about all of it, and I try to keep what's interesting for another
day.
==============
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