Reagan OMB director David Stockman blames Bush and Republicans for economic "apocalyse"

[ProSense]

Four Deformations of the Apocalypse

By DAVID STOCKMAN
Published: July 31, 2010

IF there were such a thing as Chapter 11 for politicians, the Republican push to extend the unaffordable Bush tax cuts would amount to a bankruptcy filing. The nation’s public debt — if honestly reckoned to include municipal bonds and the $7 trillion of new deficits baked into the cake through 2015 — will soon reach $18 trillion. That’s a Greece-scale 120 percent of gross domestic product, and fairly screams out for austerity and sacrifice. It is therefore unseemly for the Senate minority leader, Mitch McConnell, to insist that the nation’s wealthiest taxpayers be spared even a three-percentage-point rate increase.

More fundamentally, Mr. McConnell’s stand puts the lie to the Republican pretense that its new monetarist and supply-side doctrines are rooted in its traditional financial philosophy. Republicans used to believe that prosperity depended upon the regular balancing of accounts — in government, in international trade, on the ledgers of central banks and in the financial affairs of private households and businesses, too. But the new catechism, as practiced by Republican policymakers for decades now, has amounted to little more than money printing and deficit finance — vulgar Keynesianism robed in the ideological vestments of the prosperous classes.

This approach has not simply made a mockery of traditional party ideals. It has also led to the serial financial bubbles and Wall Street depredations that have crippled our economy. 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.

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By fiscal year 2009, the tax-cutters had reduced federal revenues to 15 percent of gross domestic product, lower than they had been since the 1940s. Then, after rarely vetoing a budget bill and engaging in two unfinanced foreign military adventures, George W. Bush surrendered on domestic spending cuts, too — signing into law $420 billion in non-defense appropriations, a 65 percent gain from the $260 billion he had inherited eight years earlier. Republicans thus joined the Democrats in a shameless embrace of a free-lunch fiscal policy.

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[Ken Burch]

1. And there's no woodshed they can take him to, now.

n/t.

[DURHAM D]

2. A little late David...

David Stockman is to economic policy as Robert McNamara is to Vietnam.

[Jeff In Milwaukee]

3. I give the guy a little credit

In "The Triumph of Politics" written in 1985(?) and in his notorious Atlantic Monthly interview, Stockman said at the time that Supply Side was nothing more than "a Trojan Horse" to bring down tax rates.

And he's the source of one of the most practical liberal/conservative observations ever about government (paraphrasing): There's nothing wrong with having a Welfare State as long as we're all willing to pay for it."

[smalll]

8. Not that late. He went off the reservation back in the 80s --

Heck, he's been on our side longer than Kevin Phillips!

[girl gone mad]

4. Sadly, Obama appears to have swallowed the supply-side kool-aid, too.

[sofa king]

7. Nope, he's just biding his time.

I'm pretty sure President Obama is running a two-term strategy when it comes to the taxation scheme. I think he's charting a very moderate path for at least the first three years of his term, maybe all four, in hopes of using his re-election coattails to stack things his way in Congress for 2013-2014. Then, when he's beyond electoral reprisal and a good chunk of Congress owes him one for spurring high Democratic turnout, he'll try hard to return to Clinton-era tax policies.

I'm sure many readers here will disagree with me, but I'm basing my guess on the fact that his public statements regarding legislation are considerably more moderate (or conservative) than his regulatory reform work has been, one plausible reason being that the press never reliably reports on the President's regulatory changes, while his dealings with Congress are fodder for the evening news. If you ask me, that's being liberal where it really counts, as the President's approval of legislation is a comparatively minor part of his job.

[jwirr]

5. They were definitely starving the beast. Norquist!

[ProSense]

6. Are people really offended by Republicans being blamed for the crisis and not Obama? n/t