Monday, August 22, 2011

More Keynesian Nonsense

E. J. Dionne has his column out today at the Post called Obama: Go big, long and global. In it he tries to make the case for yet more stimulus, but not just here at home, but also abroad. Now, I do like Mr. Dionne, I think he is independent minded and not subject to carrying the Dem's water like so many of his colleagues. That being said, he is clearly into his second glass of Keynesian Kool-Aid. But before we get into the tactics, let's talk about the strategy involved here and who Mr. Dionne is asking to get'er done (emphasis mine):

President Obama has only one option as he ponders a world economy teetering on the edge: He needs to go big, go long and go global.
Obama should not be constrained by what the Tea Party might allow subservient Republican leaders in Congress to do. He should state plainly, eloquently and in detail what he thinks needs to happen. Neither history nor the voters will be kind to him if he lets caution and political calculation get in the way.

This is amusing to me for a couple of reasons. First, the man Dionne wants to lead the world out of its economic malady is the man least qualified to do it. This nonsense about "state plainly, eloquently and in detail" was supposed to be Obama's forte. But as we have seen over the course of the last 30 months, Obama is incapable of swaying anyone to do anything with his eloquence. In fact, by most accounts, Boehner basically took him to the woodshed on the debt ceiling debate. The only thing Obama is good at is campaigning, period. Second, Dionne suggests that Obama give a detailed, ahem, plan is just plain laughable. This administration has gone out of its way to do exactly the opposite on major issue.

Okay, now the tactics. Dionne is suggesting, like all good and proper Keynesian's, that we spend more and of course tax the evil rich:

The federal government needs to come to the aid of state and local governments again; the budget cuts they are being forced to make are precisely what the economy does not need now. We must find ways of boosting spending as quickly as possible on roads, bridges, transit and other building projects, including a new program to rehabilitate the nation's dilapidated schools. And the administration needs to do far more to resolve the mortgage mess, which is holding back consumers.
Any plausible plan should include at least $2 trillion to $2.5 trillion in new revenue over a decade.

Let's see here; increase spending - check - bailout state and local governments - check - raise taxes - check and mate! Got all the Keynesian nonsense in one paragraph. Well done Mr. Dionne. By the way, were do you think the taxes will come from? The evil rich of course

[Warren] Buffett, bless him, puts the lie to the foolish idea that we need fewer tax rates, which pamper the very wealthy by taxing them at the same rates as the upper middle class. We need additional tax rates for the truly rich.
A carbon tax, partly offset by tax cuts or rebates for middle-income and poorer taxpayers, could provide additional revenue. And we need to do still more to contain health-care costs without hurting those who can't afford insurance and without voucherizing Medicare.

Buffet's proposal included higher capital gains taxes and higher rates on those making $1 million or more. Both of which will drive investment as far as possible from the country. Oh and don't forget the mysterious and ungovernable carbon tax! Tax - Tax - Tax!

Dionne is almost Krugmanesque in his argument. The amount of dollars he is suggesting for the stimulus is staggering and luckily would never get through congress. What about spending, you ask? Dionne does throw a bone suggesting that somewhere in the distant future we cut spending (Washington speak for kick the can down the road). The problem here is that there ain't no more money. Joe Biden is in China right now trying to convince them that the U.S.'s fiscal house is right as rain. Which of course the Chinese nod politely then snicker behind his back.

Both Dionne and Krugman want us to spend our way to solvency, taking the Global markets with us. Let me ask Mr. Dionne one question. Is this the way you run your household? My guess is no. The answer is to get the government the hell out of the business of social engineering. Simplify the tax code, reduce regulation and spend what you take in every year. But then if the liberals do this they would lose control of our lives and they can't have that can they?


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