Gerald. Seib (Wall Street Journal): Washington Must Admit Its Deficit Addiction

With that as the backdrop, it would amount to progress if both parties, via the debt commission, agreed that two big steps can’t be avoided:

”¢ The tax system has to be changed. The U.S. doesn’t have a system that can fund the government the country wants. The Tax Foundation says the levies paid by the top 1% of taxpayers now exceed those paid by all of those in the bottom 95%. And the Tax Policy Institute says almost half of all filers will pay no 2009 income taxes at all, because of various exclusions and credits””up, by some estimates, from a quarter in 1990.

This may be great for those who like soak-the-rich rhetoric, but it’s no way to finance a country. More than that, it’s a bit of a hoax on middle- and lower-middle-class Americans. They certainly pay payroll taxes, and the more they are excused from the income tax-system, the more likely it is that they will be hit with sneakier and less-progressive taxes. Tax reform””a flatter tax system, a value-added tax, something””is needed.

”¢ Americans have to change how they think about retirement. When the economy recovers and costs for recession-related bailouts, stimulus spending and unemployment benefits are resolved, we’ll still be left unable to really afford our Social Security, Medicare and long-term-care commitments. When the easier stuff is done, this is the hard reality, requiring a new and nonpoliticized national discussion.

Read it carefully and read it all.

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Posted in * Culture-Watch, * Economics, Politics, * International News & Commentary, America/U.S.A., Budget, Credit Markets, Economy, House of Representatives, Office of the President, Politics in General, President Barack Obama, Senate, Taxes, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--, The National Deficit, The U.S. Government

10 comments on “Gerald. Seib (Wall Street Journal): Washington Must Admit Its Deficit Addiction

  1. Dilbertnomore says:

    Recall, in our original Constitutional configuration we were given a comprehensive system of checks and balances that were intended to restrain every democratic government’s inclination to do more, spend more and require more of the country’s citizens. By the end of the 19th century the political class and its adherents became frustrated with that restraint. The advent of the Progressive era brought with it an agenda to remove the restricting checks and balances (among other changes) to enlarge the role of government. A key and quite corrosive Progressive change came along with the new Democrat Party majorities in both Houses of Congress in 1910 and the election of Wilson in 1912 with the 1913 ratification of the 17th Amendment providing for the direct election of Senators. Senators originally were named by state legislatures which made the Senators very interested in keeping the interests of the state legislatures at the forefront of their motivations – a strong check/balance against the popularly elected House of Representatives. While the Senate had indeed been the cooling saucer of restraint against the very hot and overflowing tea or coffee of the House of Representatives, the 17th Amendment transformed the Senate’s members into political panderers just like the Representatives (though with longer terms of office and different internal rules of order). With the Congress entirely populated by panderers any constraint on spending – the mother’s milk of politics – went out the window.

    Today we reap the fruits of Wilson’s Progressive agenda. Unless the organization of Congress is restored to the Federalist system so damaged by the 17th Amendment, restrain on spending is not within the power of any Congress who must pander to the populace to gain and keep their seats.

  2. John Wilkins says:

    Are you saying we need less democracy and more plutocracy?

  3. Dilbertnomore says:

    John, of course not. What a silly strawman! I expect better of you.

    What we do need is more deliberation to produce legislation that is sound in all respects – including fiscal responsibility. The Progressive reconfiguration of Congress that removed that internal check and balance established by the Founders has given us a legislative model that is organizationally incapable of restraining spending. Doesn’t matter whether it is run by R’s or D’s. We have reached the point where the effects of the Progressives’ 17th Amendment threaten to bring down our country.

    As for your seeming contention that more democracy is always better, please recall the fate of every purely democratic nation. All of them have devolved into tyranny or anarchy and have been dropped in history’s dustbin.

    For a Constitutional Republic to persevere, internal restraint of the government is essential. The republican political form is messy, inefficient, not very responsive to the instant wants of passing factions – yes. Not the ideal of any set of advocates, but far better than all the rest.

  4. Sarah says:

    Democracy constrained under the Constitution’s limits. Good comments, Dilbertnomore.

  5. New Reformation Advocate says:

    I like the WSJ article’s use of the strong word [b]addiction[/b]. For that’s truly what we’re dealing with. And coming out of denial is always the crucial first step.

    But the problem is that many addicts can’t or won’t willing enter treatment, without powerful intervention by concerned others. Who in the world can force Washington to face up to its craven addiction to massive federal deficits?

    Most likely, only two groups. The less likely group are the American voters. The rapidly growing Tea Party movement shows the depth of the revulsion out there at the extremely irresponsible, inexcusable, out-of-control spending by successive administrations and Congresses (and both Republicans and Democrats are at fault). It’s long past time for us voters to hold our elected officials responsible for their insane, addictive, destructive ways. But the sad, complicating obstacle is that many voters are addicted too.

    So my guess is that the more likely group to force Washington to start facing its deadly addiction to spending money it doesn’t have are the people who have loaned the feds the money. They have the leverage. And that just might include the Chinese!

    As Proverbs warns us: “[i]The borrower is slave to the lender[/i]” (Prov. 22:7).

    David Handy+

  6. Br. Michael says:

    I too would support the repeal of the 17 amendment for the reasons cited. I would also add a check on the ability of the federal courts to amend the Constitution under the guise of “interpretation”. What we probably need is another constitutional convention.

  7. Br. Michael says:

    I would also note that having singlehandedly increased the deficit by trillions Obama is now after a “bipartisan” effort to deal with it. Sorry, he broke it now let him fix it. He has got the majorities.

  8. Dilbertnomore says:

    Fr. David, your conclusion is, IMO, correct. I do potentially take exception to your assertion that the Congress is addicted. I believe Congress is acting in a perfectly rational manner consistent with the rules ‘We The People’ have given Congress to operate within. We have incentivized Congress, both Houses because there is essentially no significant difference in their motivations, to do all they can to pander to the electorate or anyone or anything that the electorate takes a shine to within the current election cycle. And since the best way to do that is act under the attractive perception that the fruits of the pandering come at no cost (however false that really is) to the panderee while the panderer receives full credit in the polling booth, that’s what they do.

    This all comes of a piece and over a long period of time. The main structure envisioned in the late 19th century and was put in place nearly a hundred years ago – 16th and 17th Amendments and the Federal Reserve Act of 1913 – followed by the Progressive initiatives of the Roosevelt, Johnson and succeeding administrations (certainly including Nixon, Bush (41) and Bush (43)) that encouraged citizens to become more dependent on government while diminishing the level of appreciation of what used to be called history and civics in succeeding generations through a continual refocus of the educational system away from emphasis on traditional topics central to the understanding the vision of our country’s founders and toward more ‘relevant’ topics useful to the way things ‘should’ be headed.

    We do have a problem. And addiction may be the right word. But, IMO, the addiction, if that is what it is, is due to the people and Congress having become aculturated to a well-thought out and systematically imposed new political reality that certainly would be regarded foreign and abhorent to our founding fathers.

  9. Dilbertnomore says:

    Br. Michael, I would posit that the situation surrounding abuses within the courts is a direct result of the 17th Amendment. The Senate, which must pass on the President’s judicial appointments, is naturally inclined to favor Federal Court nominees who support the Senate’s innate need to pander. Thus the tag team vigor between Congress and the Courts in advancing the appication of the ‘Commerce Clause’ (Art I, Sec. 8, Cl. 3) as the greatly preferred vehicle justifying Congress to enact laws (to me, at least) clearly in opposition to the intent of the authors of our Constitution.

  10. Br. Michael says:

    True, but the Constitution does not actually give the Supreme Court the power to rule on the Constitutionality of a statute. John Marshall appropriated it. I would have no problem in subjecting a SCOTUS decision expanding federal power subject to a 3/4 ratification by the states, the same supermajority required for a constitutional amendment. Nevertheless the 17th Amendment removed an important check on the power of the federal government in making the Senate simply another House of Representatives. Its repeal would go a long way to restoring the original Constitutional republican framework.