by Victor Davis Hanson<\/p>\n
Tribune Media Services<\/p>\n
The voters just spoke. They think they want no more gargantuan deficits, massive public spending and exponential growth in government \u2014 or the specter of higher taxes to pay for all of it. No wonder: We are on pace to owe soon 100 percent of our annual gross domestic product in national debt, while compiling the largest annual peacetime deficits in our history.<\/p>\n
So cutting the borrowing and spending is inevitable if America is to avoid a Greece-like implosion. But as the blood sport begins, we should remember the strange politics that will soon govern the process.<\/p>\n
First, no one ever reduces government in good times, when we are far better able to limit spending, and the public needs less assistance. Cutting happens only after the economy falters and the money runs out.<\/p>\n
That fact always leads to a vicious cycle: When the people believe they need public assistance the most, an indebted government is least able to provide it. Recipients become accustomed to the steady additions in federal money they receive and will insist that they can survive only by continual increases, never by their own reduction in expenditures.<\/p>\n
Second, tax-raising has limits, as we see from the California meltdown. There, a 10 percent state income tax on upper incomes and a sales tax of nearly 10 percent did not result in balanced budgets, but instead either sent high earners and businesses out of state, or made them stop hiring and buying equipment. Employers will prefer to shut down or hide rather than take risks while they feed the ever-growing state beast.<\/p>\n
Third, Democrats are always politically in a far better position to cut federal spending. As the signature party of redistributive change, they are least vulnerable to charges of being needlessly cruel \u2014 in the same ironic way that conservatives give aberrant big-spending Republicans a greater pass, as if their profligacy is somehow out of character.<\/p>\n
That paradox may explain why government spending as a percentage of GDP actually shrunk under Bill Clinton, who achieved budgetary surpluses in three of his eight years as president \u2014 but deficits and government spending rose dramatically under George W. Bush. Yet Clinton was rarely derided by liberals as hard-hearted for his fiscal discipline or praised by conservatives for his parsimony. Nor was Bush often lauded as caring by the left for his government generosity, or chastised much by the right for his profligacy.<\/p>\n
Fourth, politicians promise the easy cutting of generic “waste and fraud,” “foreign aid” or “unnecessary wars.” The problem, however, is that waste, wars, and aid this year probably account for less than 5 percent of the federal budget. In contrast, more than 60 percent of yearly spending is devoted to Social Security, Medicare and Medicaid, and Defense apart from war expenditures. Budgetary discipline is impossible without a no-holds-barred discussion of demography, increased longevity, and the national-security perils of unsustainable national debt.<\/p>\n
Fifth, self-interest governs the entire debate. Roughly half the public pays no income tax. And roughly half of America either receives all of its income or a large part of it from the federal government. Beneficiaries vote for higher taxes on others and still more benefits for themselves. Benefactors obviously prefer fewer payouts for others and lower taxes on themselves.<\/p>\n
Yet political affiliation is not always a clear guide. Despite public rhetoric, many conservatives will privately object to the cutting of any federal benefits they receive, while high-earning liberals might quietly resent having to pay increased taxes to be spent on others.<\/p>\n
Sixth, there is always a “you go first” element to budget cutting. The party that imposes discipline is demagogued, even as its opportunistic opposition usually claims credit for the improved economy that follows from the responsible policies of others.<\/p>\n
What can the public do? Americans should laud any politician of either party who has the courage to balance budgets, and they should hold accountable any who do not. Budget cutting may be depressing, but not as depressing as bankruptcy (ask the French and Greeks). Do not forget that just as households become upbeat when mortgages and credit cards are paid off, so too will Americans collectively recover their optimism and sense of pride when we are admired abroad for our fiscal sobriety rather than ridiculed for our spending addiction.<\/p>\n
And look at it this way: In terms of our collective health and national security, a budget surplus is probably worth more than an expanded federal healthcare entitlement, another Social Security cost-of-living increase, or a new aircraft carrier.<\/p>\n
\u00a92010 Tribune Media Services<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
by Victor Davis Hanson Tribune Media Services The voters just spoke. They think they want no more gargantuan deficits, massive public spending and exponential growth in government \u2014 or the specter of higher taxes to pay for all of it.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_newsletter_tier_id":0,"footnotes":"","jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[504],"tags":[],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p466Sb-ic","jetpack_likes_enabled":true,"jetpack-related-posts":[{"id":698,"url":"https:\/\/victorhanson.com\/wordpress\/austerity-versus-growth\/","url_meta":{"origin":1128,"position":0},"title":"‘Austerity’ versus ‘Growth’","author":"victorhanson","date":"June 16, 2012","format":false,"excerpt":"by Victor Davis Hanson National Review Online Who would not prefer \u201cgrowth\u201d to \u201causterity\u201d? That is the false dichotomy that insolvent Western governments, both here and abroad, are now constructing. After all, everyone prefers growing things to starving them. Yet in truth, there is no such clear-cut choice. 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Yet if both sides would agree to just follow the earlier advice of President Obama,\u2026","rel":"","context":"In "Debt and Deficits"","block_context":{"text":"Debt and Deficits","link":"https:\/\/victorhanson.com\/wordpress\/ahref=\/index.php\/categories\/angry-reader\/categorylink\/a\/politics\/debt-and-deficits\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2013\/10\/3544735027_8a0ac7b28a-201x300.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":2488,"url":"https:\/\/victorhanson.com\/wordpress\/is-the-president-in-recovery\/","url_meta":{"origin":1128,"position":2},"title":"Is the President in Recovery?","author":"victorhanson","date":"August 1, 2011","format":false,"excerpt":"by Victor Davis Hanson Tribune Media Services President Obama does not care much about deficits \u2014 other than worrying that big debt might matter in his re-election campaign. In his first three budgets, Obama borrowed nearly $5 trillion. Currently, the government is borrowing about 45 percent of everything that it\u2026","rel":"","context":"In "Debt and Deficits"","block_context":{"text":"Debt and Deficits","link":"https:\/\/victorhanson.com\/wordpress\/ahref=\/index.php\/categories\/angry-reader\/categorylink\/a\/politics\/debt-and-deficits\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2704,"url":"https:\/\/victorhanson.com\/wordpress\/california-on-the-horizon\/","url_meta":{"origin":1128,"position":3},"title":"California on the Horizon","author":"victorhanson","date":"May 28, 2009","format":false,"excerpt":"by Victor Davis Hanson NRO's\u00a0The Corner It is generally known that Americans want it both ways \u2014 green giddiness and plenty of oil and gas for their cars and homes; lots of government services and low taxes; a big military but spasms of isolationism. But now California is where the\u2026","rel":"","context":"In "May 2009"","block_context":{"text":"May 2009","link":"https:\/\/victorhanson.com\/wordpress\/ahref=\/index.php\/categories\/angry-reader\/categorylink\/a\/archives\/2009\/may-2009\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1691,"url":"https:\/\/victorhanson.com\/wordpress\/how-could-we-be-so-stupid-let-us-count-the-ways\/","url_meta":{"origin":1128,"position":4},"title":"How Could We Be So Stupid? Let Us Count the Ways","author":"victorhanson","date":"April 20, 2010","format":false,"excerpt":"by Victor Davis Hanson PJ Media We are going to pile up another $3 trillion in national debt in just the first two years of the Obama administration. If the annual deficit should sink below $1.5 trillion, it will be called fiscal sobriety. 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