More specifically, the new policy doctrines have caused four great deformations of the national economy, and modern Republicans have turned a blind eye to each one.
The first of these started when the Nixon administration defaulted on American obligations under the 1944 Bretton Woods agreement to balance our accounts with the world. Now, since we have lived beyond our means as a nation for nearly 40 years, our cumulative current-account deficit ”” the combined shortfall on our trade in goods, services and income ”” has reached nearly $8 trillion. That’s borrowed prosperity on an epic scale….
The second unhappy change in the American economy has been the extraordinary growth of our public debt. In 1970 it was just 40 percent of gross domestic product, or about $425 billion. When it reaches $18 trillion, it will be 40 times greater than in 1970. This debt explosion has resulted not from big spending by the Democrats, but instead the Republican Party’s embrace, about three decades ago, of the insidious doctrine that deficits don’t matter if they result from tax cuts.
Bravo! I have been desperately waiting for someone with real conservative credentials to point out that the neo-con’s knee jerk aversion to taxes is simply divorced from reality. It is high time for real conservatives to stand up and retake the GOP from these borrow and spend morons who are in a mad race with the radical left to see who can bankrupt the United States the fastest. Someone needs to play the role of the adult and take away Grover Norquist’s kool-aid before it’s too late.
RE: “I have been desperately waiting for someone with real conservative credentials to point out that the neo-con’s knee jerk aversion to taxes is simply divorced from reality.”
A pity that your wait will be so much longer. Stockman was a laughing stock under Reagan and remains non-credible. Were we to have forgotten his record, of course, this article’s incoherence would remind us all over again.
It may be, AO, that you are unable to really discern “someone with real conservative credentials” for reasons of consistency with your own political worldview. Regardless, however, this article is really cluelessly irrational and ill-hinged.
I find myself agreeing with both of you: that Stockman has said what needs to be said about Republican economics, and that he is the least credible person to be saying it.
Kudlow v. Stockman and it’s Kudlow in a TKO:
http://www.nationalreview.com/kudlows-money-politics/242306/flaws-dave-stockman-s-thinking
Chris, I don’t think so. Let’s start with the claim that “By the way, in the ’80s and ’90s, the debt-to-GDP ratio averaged around 40 percent.” That’s a pretty profound misrepresentation. The truth is that in that period the ratio was lowest (33%) when Reagan took office, peaked in 1995 at 67%, and then declined through the Clinton administration, reaching its next low in 2001 at 56%; it hasn’t been that low since. My average over the two decades is not 40%; it’s 52.9%. Leaving out the Clinton years, it’s still 44.9%, but that conceals a near doubling of the rate over the twelve Republican years. As to the sources of the deficit, spending as a percent of GDP was relatively constant at about 43% until 1991, when it began a steady drop. Again, the low point was in Clinton’s second term. Meanwhile, federal revenues hovered at about 18% of GDP until, yes, 1993 or so; then they grew steadily and peaked about 2001.
Whether any particular rate is good or bad is anyone’s guess. I suspect that the answer is in the context. The reality remains that spending did go down, and taxes did go up, and the deficit was for a time eliminated. It was done in a Democratic administration, helped out as everyone who was there knows by a Republican effort to spite the White House by refusing all the president’s program initiatives. Kudlow’s numbers are untrue, and whether he wants to say that spending cuts are the way to go, the fact is that no Republican administration is inclined to do it.