Thursday, July 21, 2011

Two rights

If two wrongs don't make a right, what to do two rights make? In a practical sense, try to imagine a world where President Obama and House Speaker John Boehner enact a compromise that both cuts entitlement spending and eliminates the Bush II tax cuts for the super rich. Heck, they could even eliminate the alternative minimum tax as part of the same compromise. At that point, all Obama would have to do would be ease off the crackdown against job seeking immigrants, and bring the troops home from Afghanistan and Iraq, and it would be 1995 all over again economically.

A dream? More than likely, knowing Washington, D.C., it is a mirage. The devil is in the details. The Clarion Content favors cuts in entitlement benefits (especially for prescription drugs), gradually raising the minimum age for Social Security benefits, reinstating the estate tax on estates worth more than $5 million, higher marginal tax rates on the highest income brackets, lowering and simplifying corporate taxes, along with a libertarian immigration policy.

In backwards order, no one in Washington D.C. has the guts or the political capital to address immigration policy. Obama would have been far better served to start there rather than with health care policy. Bush II was going to produce a benevolent immigration policy towards Latinos before 9/11. His failure to do so afterward is one of the great tragedies of his administration.

Lowering and simplifying corporate taxes, lots of folks in D.C. claim to support this one, yet somehow it never happens. This is the second biggest factor, after structural adjustment, for the current unemployment malaise. Lowering corporate taxes incentivizes job creation.

Higher marginal taxes on the richest of Richie Rich's and bringing back the estate tax for the very wealthy. Somehow the upper crust and their lobbyists always manage to turn this into a populist issue. At first amazing, the narrative of American capitalism has now absorbed this myth so completely and seen it defended so assiduously that to tax the rich is to attack the very basis of freedom.

Social Security is the 3rd rail and entitlement benefits are the next-door neighbors. Is anyone in D.C., even President Obama, brave enough to touch the 3rd rail of American politics? Has anyone heard from Representative Paul Ryan since he mentioned cutting Social Security and other entitlement benefits?

We know that no politician who falls anywhere on the political spectrum between Ron Paul and Dennis Kucinich has the guts to say that Bush II's wars of choice have been colossal wastes that have devoured American blood and treasure, but now are sunk costs. Osama is dead. No one can force Afghanistan to cohere without a totalitarian government.1 Withdraw already.

But much like the "big" budget deal itself, that is probably just a dream that will disappear into the daily grind of realpolitik.

1 In Iraq, America has fucked up so badly that the best play now may be to be to keep the troops there lest Iran station its tank divisions on the border of Saudi Arabia. So even though the Clarion has long advocated withdrawal from Iraq, and three, separate, new, nation-states, we may be beginning to lose faith in the viability of that option.

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