A Pox On Both Their Houses

In the midst of a heated exchange with Jonathan Chait of the New Republic, Reason magazine writer Nick Gillespie makes a very simple but oft-forgotten point - that one needn't have approved of the job George W. Bush did as President to disapprove of the one Barack Obama is doing. Like Gillespie, I happen to think Bush was an awful President, but that that doesn't change the fact that (on fiscal matters at least), Obama has been just as bad if not worse. Among the many things I disliked about Bush was his gross fiscal irresponsibility - not so much the substantial tax cuts or the massive spending hikes per se, but the fact that he pursued both simultaneously and with equal fervor, exploding a Federal deficit situation that had actually improved somewhat late in the Clinton years and leaving what was already going to be a long-term crunch looking likely to be much more painful when it finally hits. I did not vote for Obama because I wanted more of the same. But that's what we're getting, plus one - all of Bush's reckless spending, plus a little more from the long-time Democratic wish list.

The chart Gillespie posts basically tells the whole story - out-of-control Federal spending is a bigger problem than the tax cuts when it comes to the deficit situation. Whether the Democrats decide to continue the cuts or let them lapse makes no difference - we're still screwed, because we are still spending too much money we don't have. It's just a question of degree. To committed members of Team Red or Team Blue, it be convenient to bash the other side with this reality when they hold power and impolitic to mention it when you do, but for people who care more about the future of the country than the fortunes of a particular political party or its associated ideology, it's a big effing problem that needs to be dealt with one way or another. I don't want to hear from the Democrats when they're criticized for deficit spending that Bush did it too - news flash guys, that's why we fucking voted his party out of office. I want somebody, somebody, to stand up and be an adult and tell the voting public what they need to hear - that we're on an unsustainable course, that changing it is probably going to entail both tax hikes and spending cuts, and that people need to get used to that. As is, all I have is a choice of which conglomeration of connected special interests I let into the sty to begin feeding at the government trough. Pointing out that the Democrats are venal, short-sighted, and incompetent does not make one a Republican stooge any more than pointing out that the Republicans under Bush were venal, short-sighted, and incompetent made one a Republican stooge. It's possible for both sides to be wrong.

As an indepedent, I take the fact that partisan hacks from both sides despise me as a sign that I'm on the right track. Government, to the extent that is necessary, should be about solving problems and creating the most favorable possible environment for private enterprise (in business and elsewhere) to flourish. It should not be about handing out publicly financed goodies to your friends like Halloween candy because they helped to get you elected. Too often, that is what it is about, and anger over that fact is why I think anti-incumbent fervor against politicians in both parties is so strong right now.

Poverty On The March

In recession-related bad news of the day, the U.S. poverty rate has hit a fifteen year high, and the overall number of people living in poverty - about 44 million - is the highest it's ever been, at least since the Census began collecting poverty data in 1959. I suspect that political partisans on both sides will, after agreeing that this unfortunate milestone is in fact a result of the recession, make pinning the blame on the other side their first priority. Democrats will reiterate their long-standing assertion that it was Bush-era policies that led to the recession, conservatives will argue that Obama's supposed remedies haven't prevented it from getting worse - and neither will really consider the probable reality that if it is even reasonable to blame this situation on our politicians, both parties deserve some of it.

I don't have much patience or sympathy for liberal rants about greedy Wall Street speculators and the like. More than anything else, the crash was the result of a credit market that due to a combination of regulatory fiat and monetary mismanagement put cash on loan into the hands of a lot of people that weren't in a position to pay it back. Even if the government had regulated Wall Street out of building their junk pyramid of credit default swaps and other dodgy financial instruments atop it, there was still a mountain of bad debt accumulating at the center of the economy. At worst, greedy bankers merely found a way to take that crap and make a profit by recycling it into a slightly different form of crap, one in which the eau de impenetrable financial jargon made the odor slightly less offensive. They made a bad problem worse, but they did not create it. As for the Democratic agenda, well - with a painful debt-induced fiscal crisis pretty clearly on the way, I don't think shoveling massive amounts of money out the door to be spent on ill-conceived pork projects in the name of economic stimulus or enacting a massive and massively flawed new entitlement like Obamacare were the best ideas. Billions of dollars later the stimulus has not stimulated - the economy is actually worse off now than the Obama administration claimed it would have been had nothing been done - and Obamacare has already gone up in price before even taking effect.

However, I don't find the Republican claims that the way things were prior to the government tampering of TARP, the stimulus, etc. was reflective of the natural order of the free market, and that Barack Obama is some kind of uniquely pernicious socialist interloper, any less risible. The American economy has, both directly and indirectly, been shaped by government policies, many of them dumb ones, for a long time. George Bush was as much a promoter of the idea that people should own their own homes and look at them as investments and not just places to live as anyone, and did nothing to alter the market-distorting Clinton-era policies that led to the housing bubble. And no party that, when they had control of the government, started two optional, ill-planned, and unfunded foreign wars in addition to doing its own share of irresponsible domestic spending, deserves a platform to complain about the fiscal irresponsibility of the other side.

In some sense, grim news like this is just the market adjusting to actual reality. Much of the wealth that fueled the pre-recession economy turned out to be illusory. It therefore stands to reason that some of the gains that had been made against poverty also turned out to be illusory. As a society, we were not producing enough tangible wealth to support our lifestyle, from the rich investment banker making hundreds of thousands of dollars trading financial phantasms on down to the struggling lower middle-class family that stretched to buy a house they couldn't really afford. Our leaders, in their eagerness to buy us off with extravagant promises on the one hand and their reluctance to insist that we pay anything like the real price for anything we wanted on the other, enabled this overstretch, and continue to do so. This is not a failure of one political party or ideology or the other - it's a failure of the entire system, the whole nexus of government, high finance, and big business, and the Democrats and Republicans are both too much a part of that system to recognize it. While I don't agree with a lot of what the Tea Party types have to say, their inchoate anger does at least make a bit more sense to me when viewed in this light.