THE BLOG
11/30/2012 02:12 pm ET Updated Jan 30, 2013

The Republican Party Should Have Zero Credibility on Deficits

Speaker Boehner's angry response to the White House's opening gambit in the budget negotiations related to the so-called fiscal cliff provides a useful opportunity to remind folks that the GOP should have zero credibility on deficit reduction. Boehner claims that the Democrats proposal is not serious and is a bad-faith offer. Coming from him, that's rich. We have a three-decades long record to prove definitively that Republicans are themselves unserious about deficits. That has been evident during periods in which they've controlled the presidency, as both Reagan and W. presided over explosions in our national debt. And we have the account of GOP insider after GOP insider revealing the true motives behind GOP fiscal policy. As far back as 1981, Reagan budget director David Stockman admitted that Republicans' professed concern with the impact of deficits and debts on our children and grandchildren was just a ruse to allow Republicans to avoid responsibility for the adverse consequences of lowering taxes on the rich. Bruce Bartlett, a former Reagan treasury official has explained in detail that the right-wing's rhetorical push against deficits over the past thirty years was not the product of a sincere commitment to fiscal prudence. Rather, Bartlett has shown, the goal was to reduce taxes on the rich, which would starve the government of funds, which would require government to cut spending for the less well off. In other words, the concern was never deficits. The desire was to reduce social spending for those deemed undeserving by the Republicans, including poor children, the struggling elderly and other disfavored groups. Deficits were merely the excuse for doing so. And Vice President Dick Cheney stated as emphatically as he could that, when Republicans hold power, "deficits don't matter."

All of this is the necessary backdrop for discussions about the current budget negotiations. Remember that in 2011 (and again in 2012), House Republicans nearly unanimously approved Paul Ryan's budget, which has more or less become the foundational expression of the Republican view of government. The original budget, since modified to some degree, called for eliminating capital gains taxes and dramatically cutting income taxes on the wealthy, to be financed by gutting Medicaid and other social programs. Ryan knew that this plan was not, in fact, a deficit reduction plan, though he tried to pass it off as one to an embarrassingly credulous media. Ryan also knows his proposals would not reduce the deficit, which is why he refused to submit the entire plan to the Congressional Budget Office (CBO) for scoring, asking instead that the CBO score a bizarro version of his budget.

Amidst a series of bad faith proposals and arguments, none has more clearly illustrated the GOP's intentions than their approach to Medicare. Republicans have long insisted that in order to reduce our long-term spending, we must get entitlements under control. This is a bogus argument (one shared by many non-Republicans, of course) on many levels, one of which is that Social Security, as President Ronald Reagan explained clearly, does not add one cent to our deficits. Concerning Medicare, it has long been clear that the program's financial challenges are largely due to rising health care costs in general. And the GOP has repeatedly opposed serious attempts to control those costs. For example, the Affordable Care Act (ACA) included some significant cuts in Medicare spending by reducing, for example, overpayments to the Medicare privatization experiment known as Medicare Advantage. Those spending reductions, originally estimated at about half a trillion dollars over ten years, became the focal point of GOP attack ads during the 2010 mid-term election cycle. In other words, despite repeatedly insisting that entitlements must be reined in, the GOP's response to a plausible effort to do so was to pillory Democrats for supposedly attacking seniors.

The Ryan budgets have included the same reductions to Medicare included in the ACA. But the benefits of those cuts, which in the ACA were slated to help seniors by, for example, closing the prescription drug benefit doughnut hole, were re-purposed by Ryan to pay for his tax cuts for the rich. And incredibly, once he joined the Romney ticket, Ryan's Medicare cuts were forgotten, and Romney/Ryan relentlessly attacked Obama for cutting Medicare and hurting seniors. So, to sum up: 1) the GOP repeatedly insists that we cut entitlements; 2) at the same time, it bashed Democrats in 2010 when they actually took steps toward doing so; 3) it then embraced, dollar for dollar, the cuts for which it had just bashed Democrats, while approving shifting the savings from those cuts away from benefiting the seniors it claimed Democrats were hurting; 4) it then resumed bashing Democrats in 2012 for cutting Medicare, pretending it hadn't already approved the same cuts 5) and now, having lost the election, it insists that Democrats aren't serious about reducing the deficit unless they agree to cut entitlements, including Medicare.

It happens that the broad outlines of the Democrats' proposals are reasonable, if inadequate, under the circumstances. Raising taxes on incomes over $250,000 from 35 percent to 39.6 percent, while not earth-shattering, is a step toward reducing long-term deficits. Preserving tax cuts on lower incomes, when those extra savings are much more likely to be spent, is clearly economically logical given our sluggish economy and the stagnant incomes of most non-wealthy Americans. Some money for stimulus also makes compelling sense, given weak economic growth, as does extension of unemployment benefits (we should, of course, be spending much more than a pittance on stimulus, but that's a political impossibility currently). What the GOP will counter-propose instead will make far less sense - keeping tax cuts for the rich, despite the relatively weak bang for the buck that those yield for the economy; cutting desperately needed social spending for the less well-off, which is both immoral under the circumstances and economically counter-productive; and insisting on entitlement cuts, when Social Security contributes not at all to the deficit and the GOP's credibility on Medicare is beyond laughable. And the GOP's proposed health care cuts, including to Medicaid, will do nothing more than shift the costs of that care from government onto beleaguered families.

Among the real problems perpetuated by the mainstream media's focus on "both-sides-do-it" and an insistence on bi-partisanship is the inaccurate perception that our problems would be resolvable if each side were equally committed to finding real solutions. In fact, one side has, insufficient though it is, a credible and empirically valid conception of how the mix of spending and taxing might help us in the current circumstances. By contrast, the other side maintains a rigid and ultimately incoherent insistence both that the only kinds of savings that accomplish anything are those that hurt the less well off and that asking the rich to pay a little more is a dagger aimed at the heart of American capitalism.

Beware any deal (*cough* Simpson-Bowles) that tries earnestly to find a middle ground between these two poles.

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