24 April 2011

Conservative Republican David Stockman acknowledges taxes must go up, and military expenditures must be cut

David Stockman, OMB director under Reagan, has criticized the Republican Budget as totally unrealistic and ineffective (while also criticizing Obama's plan as little better) in an op-ed in today's NYT.

I wish he'd examined the People's Budget, not from an ideological point of view (he is a conservative Republican, after all), but a pure numbers point of view.

I question whether Stockman's prescription for means testing Medicare and Social Security is really logical or based on realistic projections. He dismisses major savings in health care costs out of hand. I think to achieve them, we will have to enact a public option and make the hard choices of taking profit out of health insurance and health care, as Europeans have done; and I have to admit there seems little prospect for that in the near future. He also fails to mention the plan to balance the cost of Social Security by raising the cap on income subject to payroll taxes.

When you're in prescriptive mode, as Stockman is in this piece, it's dishonest not to acknowledge alternative major policy proposals that would resolve the issues you're discussing. The usual cop out that an idea is "politically infeasible" doesn't cut it here... many of the ideas he's talking about are at least equally politically infeasible, such as means testing Medicare. Ideas only become politically feasible when a critical mass of people are informed enough to start thinking that they just might work.

But I do agree with him that, while he advocates increasing marginal tax rates on the rich, and eliminating the unjustifiable low rates on capital gains (noting that the whole original rationale for that no longer applies), while wonderfully welcome coming from a Republican, that is just not going to be enough. Taxes on more moderately well off people, like me, will have to go up as well. I probably favor much higher taxes on the richest than he does, but I do think that even those in the $80,000+ category should see significantly higher taxes. If we want a functional society, we have to be prepared to pay for it.

I also don't think he was nearly specific enough, while acknowledging that military spending... (he calls it "defense" spending, as most do, but I reject that propaganda euphemism) ...will have to be cut. In my view, restoring some semblance of fiscal balance and policy mix that serves the interests of the majority of Americans will require drastic cuts to military expenditures over the next decade. The good news is that those drastic cuts are called for for a whole host of policy reasons anyway: as Chalmers Johnson has persuasively argued, the restoration of the American Republic will require the dismantling of the American Empire.

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