How about a civilized, thoughtful economy debate
| (click for larger version)|
May 11, 2011 | 07:35 AMThe pendulum may be swinging back.
A few weeks ago I wrote a column saying Wisconsin's own Paul Ryan, the poster boy for the GOP budget proposals, may be in line to be president some day. I stand by that prediction.
However, over the last few weeks the Democrats have taken the offensive. Obama, having sat on his hands and let the Republicans take the initiative on budget proposals, has apparently listened to his advisers and finally jumped into the fray.
His speech a few weeks ago emphasized his belief that cost cutting shouldn't be the only key to deficit reduction. He took aim at the continuation of the Bush tax cuts for the wealthy. Then the administration questioned why oil companies need tax breaks in light of high gas prices (in this case, higher gas prices might pay political dividends).
Whether those attacks hold water will be determined in the days, weeks and months ahead. But Obama's position heightens the political drama. And, of course, the death of Osama bin Laden under Obama's leadership certainly puts him in a better political situation.
Even some Republicans who believe in cost cutting believe that taxes can't be off the table — our deficit is so severe that cutting revenue doesn't seem rational, they argue, and just cutting expenses doesn't seem like enough.
Developments like the disclosure that GE will pay no taxes on 2010 earnings of $14.2 billion doesn't warm the hearts of the middle class, especially public workers being blamed for their role in our economic troubles. Of course, we all might have such luck if we had 975 people in our own personal tax department as GE does.
The same companies that received government bailout money are now doing better. That's good, but they've also returned to giving big bonuses to CEOs. This rubs some people the wrong way. Of course, there are both liberals and conservatives who think that bailing out failing companies was a bad idea in the first place. Agree or not, the whole scenario seems to beg the question: Do we really want to run our country like a business when some of our biggest businesses failed to keep up their bottom lines?
People who hark back to the good old Republican heydays under Dwight Eisenhower and Ronald Reagan ignore the fact that taxes on the rich were much higher then (and, the tax breaks afforded them were fewer, too). And clearly the distance between rich and poor has only increased. It's hard to deny: The rich can afford higher taxes more than the middle class, and can contribute more to deficit reduction. Others will argue against our progressive tax system in the first place, but that's a much larger discussion.
In Wisconsin over the last few months, the cry has been that public employees need to chip in their fair share. Now Obama has switched the tables and asked for the same from the wealthy. Some people will say the wealthy have earned their money. Public employees can say the same thing. One group "earned its money" through negotiations. The other group "earned its money" through the tax system.
Of course Republicans make the claim that tax increases do nothing to improve the economy. On the other hand, there is scant evidence to support the trickle-down theory ("voodoo economics," as the first George Bush called it). Based on the job market, the idea that the rich will invest their tax savings into job creation doesn't seem to hold much water.
A radio show the other day gave me another perspective: Maybe we shouldn't use the tax system as a mechanism for improving the economy. Maybe it has one goal — to fund the government. Attempts at doing more, like manipulate the economy, tend to fail and get caught in political quagmires.
Ryan gets points for a gutsy attempt at solving the country's economic woes. While his plan isn't fleshed out totally it's probably as advanced as any brought forth by a politician so far, whether you agree with it or not. On the other hand, Obama is making a strong point, too — that the rich should pay their fair share. It's an argument that may resonate with the middle class, and one that the Republicans may have a hard time rebutting — a bit of political jujitsu by an administration hungry for a break.
That brings me back to another suggestion I made in that previous column≠ — how about a debate on the economy between Ryan and Obama? Sure we can get some economists from both sides to do the same thing, but their arguments would probably sound like gobbledygook to the average American.
Ryan and Obama are both smart, both articulate and have reputations of being pretty reasonable guys.
Isn't it time we hear about the economy from both sides, without yelling?
That might only happen if they stand on the same podium in a presidential debate.
Halverson is the general manager of the Regional News.