Re: The Memory of Bush

Until Americans, (U.S.), are weaned off the big nipple in the sky that is govt. 
and spending is cut the doom keeps a rollin'

Mike F.  




________________________________
From: Peter Chattaway <[email protected]>
To: Daniel Amos off-topic listserver <[email protected]>
Sent: Thu, June 16, 2011 11:50:28 AM
Subject: [DADL-OT] The Memory of Bush

http://douthat.blogs.nytimes.com/2011/06/16/the-memory-of-bush/

by Ross Douthat
June 16, 2011, 11:23 am

As the economy continues to struggle, Jay Cost compares Barack Obama to Jimmy 
Carter, and Walter Russell Mead compares him to Herbert Hoover. But HotAir’s 
Allahpundit, parsing the numbers from the latest Wall Street Journal poll, 
suggests why neither of those shoes quite fit. Neither Carter nor Hoover could 
credibly pin the country’s economic problems on their predecessor, but the 
country still assigns George W. Bush much more of the blame for our ongoing 
malaise than it assigns to Obama.

    We like to goof on The One for blaming Bush for his problems, but the reason 
he does that is because it works. People remember who was president when the 
financial crisis struck, they remember having utterly lost confidence in that 
guy for various reasons during his second term, and they’re prepared to cut O a 
wide, wide berth on the economy because of it.

The numbers he’s talking about show that 62 percent of Americans still call the 
current economic picture “a situation Obama inherited,” and only 25 percent call 
it a situation that the president’s policies are “mostly responsible for.” As 
Allahpundit notes, those numbers will probably “move as we get closer to the 
election,” since “the number who say he inherited the economy plunged as the 
midterms approached.” But it’s still a built-in advantage that most presidents 
presiding over these kind of jobs numbers wouldn’t enjoy. And if you’re a 
Republican candidate in 2012, the resilience of this advantage (and the memory 
of Bush that it’s founded on) seems like a good reason not to run for president 
on an economic agenda that just doubles down on supply-side economics, while 
refusing to admit that there were any problems with the Bush economy that 
couldn’t have been solved with more tax cuts for businesses and investors.

When I offered exactly that critique of Tim Pawlenty’s economic plan, Nick 
Schulz objected:

    Pawlenty’s proposed tax reforms are substantive and unambiguously growth 
oriented. Bush, on the other hand, was far from a serious tax reformer. He cut 
tax rates, yes, but left the system largely intact and exceedingly complicated.

    It’s worth remembering that Bush’s political approach to taxes was often 
explicitly designed to appeal to middle-class voters (e.g. the expanded child 
credit). It yielded results Ross now rightly criticizes.

    Any given politician’s policies can have only so much effect on economic 
growth. And Ross and some other skeptics of growth politics are right to argue 
that growth can’t solve all the nation’s problems. But they make the opposite 
blunder by giving short shrift to what growth can accomplish. It’s a mistake to 
characterize Pawlenty’s approach—which is nothing if not bold reform with growth 
at the core—as Bush redux.

The policy questions here deserve a longer reply. (In a nutshell, I think it’s 
possible to craft a pro-growth tax reform — a hybrid of Simpson-Bowles and 
Ponnuru-Stein, maybe — that’s roughly distributionally neutral and doesn’t blow 
a hole in the deficit, both tests that I suspect Pawlenty’s plan would fail.) 
But I just want to focus on the political implications of the argument that 
Pawlenty’s tax policies represent a big improvement on the Bush tax cuts.

You’ll recall that Bush cut taxes on upper earners, capital gains, estates, 
dividends, etc. He also cut taxes on families and the middle class. He also cut 
taxes without offsetting the cuts with spending reductions, on the assumption 
that growth would take care of any deficits that ensued. He didn’t reform the 
tax code by shrinking the number of brackets, as Pawlenty proposes to do. As 
Schulz notes, Bush’s mix of policies earned disappointing results — not 
necessarily in terms of overall growth rates (at least before the financial 
crisis), but in terms of wage growth for middle class and downscale Americans, 
and in terms of their impact on the national debt. So against that backdrop and 
amid those memories, the Pawlenty plan would send Republicans to the hustings 
with a tax plan that’s likely to increase the deficit, and with the argument 
that the reason wage growth for the middle class was so disappointing in the 
Bush years was that Bush’s tax policies were too weighted toward middle-class 
concerns (!), and didn’t go far enough in flattening the tax burden and lowering 
rates on investors and the rich. In other words: Dear middle class American, 
we’re going to address the economic anxieties you experienced in the ’00s with a 
deficit-increasing tax reform that’s much more favorable, in its initial impact, 
to the wealthiest quintile of the country than were the Bush tax cuts.

My view of this argument — that the path to middle-class prosperity is paved 
with more, and still more, upper-income tax cuts — is similar to my view of the 
oft-heard Democratic talking point that the 2009 stimulus package would have 
worked if only it had been much, much larger than the (extraordinary, 
unprecedented) package we actually passed. Even if I were completely convinced 
of the economic case in either instance, I would still be dismissive of the 
political case, on the grounds that a policy is only actually feasible and worth 
championing if you have some hope of persuading a majority of Americans (and 
their elected representatives) to go along with it. Any Republican tax plan that 
can be caricatured as “more Bush than Bush” seems likely to fail that test, and 
give Barack Obama a great political gift into the bargain.


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