DEMOCRATS: CLEANING UP AFTER THE ELEPHANT
It is summer in Washington and it gets very hot (it can be a hundred degrees at midnight). Hot and oddly silent. The great buildings on Capitol Hill seem to shimmer in a soft silvery light. There are legislators in the Capitol but there is an election coming in November and most members of the Congress are really concentrating on their election campaigns (the nearly 50 Republicans who are retiring are thinking about the perils of retirement). Little legislation will actually pass before the November elections. The votes now being taken on immigration are mostly empty gestures; grist for the campaigns in the fall. No one thinks they will really pass!
Over the last thirty years, the parties’ candidates have campaigned on fairly consistent themes. Listening to Republican campaigners we hear endlessly that the Democrats are a party of tax and spend liberals, wasteing the tax payers’ money on people who won’t work and who don’t deserve the money. Republicans, on the other hand, are a party dedicated to a strong defense, smaller government, lowering taxes, and reducing government spending. For Democrats, the Republicans are really the party of the rich and the well off and those tax cuts really are designed to help those people. The Democrats care about the people in the middle class. Their goal is to help workers and ordinary families.
Let us think about that, because the truth is often the opposite of a party’s campaign themes. The truth is that it is far easier to lower taxes than to lower government spending. So when Republicans have the majority they do lower tax rates. They do not lower spending! Because current programs on the books must be funded as a matter of law, it is very difficult for Republicans to quickly lower spending on them. Republicans do always want to increase military spending and they will. So, with tax rates lowered and less money coming in, military spending increasing, and most people programs functioning at the same level, there will be major deficit increases. At the end each fiscal year those deficits will be added to the national debt. So the end result of Republican administrations is really more spending and more borrowing. The debt always goes up. An honest campaign slogan would read that “We will cut taxes and we will borrow more money”.
So when the Democrats regain the majority they are confronted with a dilemma. There are programs that they campaign for and really desire to put into effect. They also see the ballooning deficits! Because of frenetic opposition from Republicans (for Republican true believers, taxes can only go down!), it is extremely difficult for Democrats to reduce the deficits by raising taxes. Republicans are not shy about bringing up the old meme about “tax and spend liberals”. So, in the end, the Democrats have to give up on their programs and devote their efforts to getting the deficit down; solving a problem that the other party has created. So an honest slogan would be “We’d like to help you. We have great programs. But, we have to clean up after the Elephant”.
Then, usually after two terms, with the economy back on track, the Republicans elect a president and congressional Republican majority, and the cycle starts all over again (For some reason, the business community always supports the Republicans even though all the statistics show that they do better under Democratic administrations). The Republicans once again push through tax cuts (which are always popular with their business benefactors). They do not cut spending and the deficits begin to rise. The voters once more turn to the Democrats, who once again must spend their time trying to maintain their programs and still reduce the “Republican deficits”. And so it goes!
We can see the pattern by looking at the third year’s deficit for several presidents. The reason for doing that is that the first year or more of any president’s budgeting is really carried over from the president previous. Thus, President Jimmy Carter (elected in 1976), found his first year’s budget already done by Gerald Ford when Carter came in. Then Carter’s fourth year budget was “adjusted” by Ronald Reagan after Reagan came in. So that third year budget was purely Carter’s. Carter’s third year deficit in 1979 was 41 billion dollars. Then in 1983, after Ronald Reagan lowered taxes, the third year borrowing was up to 208 billion dollars because of those Republican tax cuts. Then Reagan pushed through tax increases so that during his second term 1987 deficit was down to 150 billion dollars (still far larger than Carter’s who Reagan had loudly accused of overspending). His one term Republican successor, George H.W. Bush in 1991 borrowed 269 billion. Democrat Bill Clinton, elected in 1992, managed to maneuver a tax increase through Congress and, with that (and the help of the tech boom), lowered borrowing to 164 billion in 1995 and down to 69 billion in 1998. In his last two years Clinton ran surpluses and actually paid down some of the Debt. But then the Republicans were back, and once more there were large tax cuts. After Republican George W. Bush pushed through his tax cuts, the deficit in 2003 ballooned to 378 billion (378,000 million dollars).
Elected in 2008, The Obama administration borrowed 1300 billion in 2011, much of which was put back into the economy to head off the Great Recession. By Obama’s second term, in 2015, the deficit was down to 438 billion. Then Donald Trump was elected in 2016 and the Republican Congress, right on schedule, pushed through another big tax cut. Trump’s third year deficit is now scheduled to be about 984 billion dollars (and the ones to follow are projected to be no smaller) without any recession to fight. Think about that number: We will borrow 984,000 million dollars even if nothing else goes wrong. It will be added to the national debt.
So, it isn’t that hard to see the pattern: Republicans come in and lower taxes but increase spending and then have to borrow. Democrats come in wanting to put in place what they think of as needed programs but they are stymied because they have to pay off the Republican administrations’ created debt. So, they never really get the chance to create some useful programs (which might really help those people who were promised things at Donald Trump’s rallies). That is the cycle that we are in. And, unless the voters choose differently than they have, the cycle will go on and on!
H.J. Rishel 6/28/2018