One Step Forward, Two Steps Back
Cato Institute fellow Daniel Mitchell has a piece here comparing the Bush presidency unfavourably to the Clinton presidency. I won’t quote the article because it is a detailed piece that deserves to be read in full.
It is hard to avoid the conclusion that the Bush presidency has been an unmitigated disaster for libertarianism in America. Whatever one’s views on Iraq, it certainly didn’t represent a philosophy of decreasing the level of state power. About the only positive thing on the Bush Jr. record, from a libertarian point of view, is the tax cuts. Unfortunately the cuts were fuelled by enormous budget deficits and a looming fiscal crisis thanks to Social Security.
The article makes the point that Clinton’s record would have been a lot worse had he not had to deal with a hostile Congress. If I were a betting man, which I am, my money would be on either Obama or Clinton to capture the White House in 2008. With Democrats in charge of Congress, we are unlikely to see things get any better from a fiscal point of view. At least the social conservatives might get squashed back into the hole from whence they came.
Speaking of the ascendancy of the Democrats, does anyone have links to any of the myriad articles and posts I remember reading from a couple of years ago about how the Democrats were a hollow shell of a party on the verge of catastrophic collapse? I’ve been Googling, but so far without success.
11 Comments
Sorry, the comment form is closed at this time.
-
Recent Comments
Catallaxy Files- What caused the recessions in Europe, Asia and Australia? February 8, 2012It is the middle of the night but cannot sleep so I have been reading Thomas E. Wood’s Meltdown which is a very interesting discussion of the causes of the Global Financial Crisis. Wood is trying to demonstrate that the GFC here in the US was caused by government interference in the housing market but [...]Steve Kates
- Property rights and revenue models February 8, 2012I’m sure everyone has heard about the Optus copyright ruling. The Federal Court has ruled Optus is not breaching copyright by allowing customers to watch sporting matches shown on free-to-air TV on a short delay through its mobile TV Now service. What Optus have done is effectively sell remote access to your video recorder. People [...]Sinclair Davidson
- Stephen v Stephen: University quality February 8, 2012A bit of a spat has broken out between Stephen King and Stephen Matchett. King is the soon to be former Dean of Business at Monash University and Matchett is a higher education analyst at The Australian. It started with this post and conclusion. Unfortunately, unlike universities in many countries, Australian higher education has become [...]Sinclair Davidson
- What caused the recessions in Europe, Asia and Australia? February 8, 2012
- inCISe
- Auto industry privileges are irresponsible February 8, 2012A program of perpetual subsidies for any industry is both economically irresponsible and morally unfair. Over the past weeks, there has been a resurgence of protectionist rhetoric and anticompetitive industry policy. Under the rationale of preserving a domestic manufacturing sector and saving local jobs, the federal government has renewed its assistance for […]Alexander Philipatos
- Dr Hartwich ‘economist extraordinaire’ February 6, 2012All tickets have sold for tonight’s fiscal talk by Oliver Marc Hartwich. He will address Europe’s mess some call the economy, and look at the growing opportunities available in Asia for Australia. If you were unlucky and didn’t secure a ticket, don’t fret, a full video recording of the talk will be availabe in the coming days. In the […]Editor
- Time to drop the Dick February 5, 2012Flanked by five busty blondes and a chihuahua, ex-entrepreneur Dick Smith created a media stir in August 2010 when he announced an award of $1 million for the brightest idea to stop population growth and find an alternative to economic growth. The competition was open to anyone under the age of 30 and due to be awarded within 12 months. A year and a half lat […]Oliver Marc Hartwich
- Auto industry privileges are irresponsible February 8, 2012
- IPA news
- Scientific research drowning in a sea of alarmism February 6, 2012Last week, almost 400 people attended a public meeting in Newcastle to learn about the scientific evidence that underpins...
- Who'll drag us free of our heavy debt burden? February 2, 2012While most Australians were tanning themselves at the beach during their summer breaks, the federal opposition and the...
- Renewable energy rules lose traction January 31, 2012Energy policy in Organisation for Economic Co-operation and Development countries is spurred by concerns that gas...
- Scientific research drowning in a sea of alarmism February 6, 2012
Tax revenues have not declined in the USA even after the Bush cuts to tax rates. As such it is silly to blame tax rate cuts for budget deficits. If revenues have risen then budget deficits should be blamed on excessive spending. Which brings us back to Iraq.
Reminds me of Mrs. Thatcher. She campaigned on lowering taxes and reducing the state, but all her good intentions seem to have been for nought. Even if we credit Mr Bush with the best of intentions, the growth of the government seems inexorable. Maybe there is a natural law, that governments can only grow, not shrink.
From Mark McMullen, a senior economist at Moody’s Economy.com as reported in the Christian Science Monitor:
Terje, fair point. I should have said that tax cuts are worse than useless if you don’t cut government spending to match. Big government built on big tax is better than big government built on borrowing money.
Even that is debatable, I suppose. I should refrain from general pronouncements completely and just say that without addressing the fundamental government spending problems, the Bush tax cuts look a lot to me like rearranging deckchairs on the Titanic.
I’d prefer to have an indebted government rather than a high taxing government. That way it is the bankers problem rather than our problem. And even if it means higher taxes later on I’d rather be exploited next week rather than this week.
Trinifar – your article contradicts other pieces I have read from the CBO. But I’ll seek to get the details before I comment further.
chrisjv,
i would disagree. if a large government is in, what could be seen as a sustainable position of having enough tax revenue to cover its costs then it will be in a much better position to stay large or get even larger, whereas if it is based on borrowing then the government will be faced with either increasing taxes which isn’t very popular politically, or decreasing the size of government.
There isn’t any empirical evidence that a bad economic position makes a country less inclined to accept socialist policies. The opposite, if anything. While it’s true that increasing taxes is unpopular, it must be less unpopular than cutting services, otherwise we wouldn’t have the problem of big government in the first place. Governments usually combat the unpopularity of tax by levying it on minorities – corporations and the wealthy.
chrisjv,
is there any emperical evidence either way? I also think i distinction needs to be drawn between a government in a bad economic position and a country in a bad economic position.
Perhaps a government would eb less likely to cut services as much as just trimming down and making a few efficiency improvements.
Although i’m not sure i fully agree, you do have a point about the unpopularity of cutting services. that said, both tax increases and service cuts can be redily disguised in a major restructure.
[...] ChrisV at the Australian Libertarian Society blog discusses a recent Cato Institute piece that compares the Bush presidency unfavourably with the Clinton presidency. His verdict? It is hard to avoid the conclusion that the Bush presidency has been an unmitigated disaster for libertarianism in America. Whatever one’s views on Iraq, it certainly didn’t represent a philosophy of decreasing the level of state power. About the only positive thing on the Bush Jr. record, from a libertarian point of view, is the tax cuts. Unfortunately the cuts were fuelled by enormous budget deficits and a looming fiscal crisis thanks to Social Security. [...]
Pingback by Club Troppo » Missing Link | March 22, 2007
Trinifar – the following data suggests that revenue declined in only two recent years (2002 & 2003) and then rebounded strongly.
http://www.irs.gov/pub/irs-soi/histab18.xls
If you adjusted for inflation then maybe it would be fair to say that revenues declined in three years (as your quote indicated). However none of this takes away from my point. Tax revenues now are much stronger than they were in any earlier year. Tax rate cuts have not caused any sustained decline in revenue.