RoR: Forum

SW: "The problem is that to purposely create a crisis to effect change requires a level of dishonesty that goes far beyond what anyone within our political class are willing to use - except for those on the far left who were raised on Fabian Socialism's tactical practices ..."

But it applies to us, too. We have the opportunity to move the window, as well. When you propose nothing but police, courts, and army so often that it becomes cliche, then cutting Medicare/Medicaid is not unreasonable.

In fact, I believe that in the next generation,that will happen. The Gen-Xers are not going to support centigenarians forever. The same is true for schools. Unschoolers now get the headlines once given to homeschoolers. Look at the quote from Jon Polito. That attitude of not going along with the crowd is essentially American. We just need to tap into it. The specifics of politics are less important than the cultural (philosophical) shift away from collectivism.

A deeper reflection of that is our own worry and attention to the government's debt. Hey, I have debt, too. Do you care? Why should you? Why do we care if the government is bankrupt or over extended or whatever? Let them do what they please, as long as you can avoid the consequences.

Those consequences came to us because so many still buy in to the collectivist process. It takes real moral courage to invest in new technology when a tax-free municipal bond is being offered. That is the case we need to make: invest in the markets; ignore the government.

Post 21

Friday, August 5, 2011 - 3:02pm

I wrote, "The problem is that to purposely create a crisis to effect change requires a level of dishonesty that goes far beyond what anyone within our political class are willing to use - except for those on the far left who were raised on Fabian Socialism's tactical practices ..."

And Michael replied, writing, "But it applies to us, too. We have the opportunity to move the window, as well. When you propose nothing but police, courts, and army so often that it becomes cliche, then cutting Medicare/Medicaid is not unreasonable."

It is completely true that we can (and are) moving the window - the Tea Party, for example, has moved the window further and faster than anything but major crisis (like WWII or the market collapse leading to the Great Depression).

But I totally disagree that we (and I'm not sure who Michael is including when he refers to "us") are either creating a crisis or engaging in dishonesty. I don't think that was what he was referring to. He is right that when we keep making good arguments for what is proper for government we are shifting the window (or at least part of the flow of ideas - the net effect of which will determine where the window goes).
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The younger generation is quite likely to become more and more hostile towards the boomers, and Michaels suggestion of tapping into that, and into any of passionate moves away from statism/collectivism, is a good one - we have the full set of integrated philosophical principles that can frame what might otherwise only be angry reactions to turbulent times.

He wrote, "The specifics of politics are less important than the cultural (philosophical) shift away from collectivism."

Actually, what is important is to use the emotions and the details of the political specifics to frame the explanation of the applicable principles for the desired cultural/philosphical shift. They have to go together.
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Michael wrote, "A deeper reflection of that is our own worry and attention to the government's debt. Hey, I have debt, too. Do you care? Why should you? Why do we care if the government is bankrupt or over extended or whatever? Let them do what they please, as long as you can avoid the consequences."

That makes no sense at all. Michael's creditors care about his debt. Presumably Michael cares about his debt. We (the nation) owe that money and it will come out of our future prosperity in one way or another - it is a burden on the economy, it effects future rates of inflation, it will determine the cost of borrowing, it effects the amount of money available to borrow, it effects the jobs that are available, and nearly every aspect of our lives. People are moving to other states (like Texas), uprooting their lives as a consequence. The point is that you can NOT avoid the consequences. Someone can say, "Yes, I can. I'm going to buy a boat and sail to distant areas where they aren't nearly as adversely effected as we will be here." But that too is being forced to an extreme to avoid consequences that we should not have been subjected to.
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Michael wrote, "It takes real moral courage to invest in new technology when a tax-free municipal bond is being offered. That is the case we need to make: invest in the markets; ignore the government."

I have to think that this comes from the anarchy nonsense that can so cloud good judgement. Investment practices that ignore government when it is government's heavy handed interference that is moving the markets - choosing, or causing 'winners and losers' - would be more like near-delusional self-sacrifice than investment. I certainly wouldn't invest in either municiple bonds or new tech equities until we have greater stability, and that will only come with turning this government back towards free market principles.

No government and too much government and bad government are all the same in their effects - a failure to provide and protect the "free" part of the "free markets".
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Post 22

Saturday, August 6, 2011 - 3:46am

John, I don't like government borrowing either. I was just trying to point out that a balanced budget amendment might not have the desired effect that we might assume.

Spending comes with two kinds of political costs. Either you cover the spending through taxation, or through deficits/debt. Taxation has the bigger cost and neither party wants to be responsible for it. Democrats, who love increased taxes, never want to be blamed for them. So they look for ways to make them bipartisan. They'd happily increase taxes more if they could spread the blame around.

This kind of nightmare balanced budget amendment would presumably prevent the deficit/debt problem (avoiding that cost), and could force the tax increases to be bipartisan (or even automatic).

I guess the optimistic/naive view is that government would only spend what it has. If it spent based on its projected "revenue", that would be open to abuse. So would it be better to wait until it has money and then it can decide what to do with it? That might work better, but it would encourage spending every tax dollar. There would be no concept of a surplus (not that that is a concern these days), and instead of the idea that government should only tax what it needs to do the job, we'd have a system where the government must spend it or lose it.

What about long term spending bills? Social security doesn't just specify how much money will be spent this year..it creates obligations for the future. Would that even be allowed? If so, how would it be paid for? If one party passes spending obligations in the future, the other party would be required to either cut those obligations, or to increase taxes to pay for them. You might think that a balanced budget amendment would require those doing the spending to simultaneously be increasing the taxes, incurring the political cost for increased spending. Wouldn't that be great? They'd be held responsible? But then the least costly way to give out political favors is to pass future spending bills and push the costs to the next party (and the costs are the worst kind...tax increases).

Would it end up being better than what we have today? I don't know. I think it would have many unexpected side-effects. One very real possibility is that it reduces the political cost of tax increases by forcing them to be bipartisan (or automatic). Instead of limiting spending, it might encourage it. The current costs may not be much, but they do work as a disincentive to some degree.

So I guess your question might be answerable if spending were constant, and it was a question of how should it be paid for. But the real question is how a balanced budget amendment might change the spending side of the equation. Would it discourage spending by forcing politicians to incur the cost of tax increases when they propose spending? Or would it encourage spending by reducing the political cost of tax increases by spreading the blame?

Post 23

Saturday, August 6, 2011 - 11:57am

Joe, the point I was trying to make is that deficits/debts are simply themselves a form of taxation, and in fact an even worse form of it because it translates to an even higher tax increase when factoring in the interest that is paid on it. Deficit spending is simply a tax increase that is pushed into the future.

You might think that a balanced budget amendment would require those doing the spending to simultaneously be increasing the taxes, incurring the political cost for increased spending. Wouldn't that be great? They'd be held responsible? But then the least costly way to give out political favors is to pass future spending bills and push the costs to the next party (and the costs are the worst kind...tax increases).

But that would be the point, even if a spending bill requires future spending obligations, at least you force the issue of how to pay for it (or consider dropping the obligation). If you must raise taxes, then at least you have to deal with an electorate that can assess with more immediacy whether they favor the government spending program enough to justify giving up more tax money. If the next party thinks the political cost of raising taxes is too high, then they cut the program. Right now, it's too easy to get an electorate on board with a government program if they don't see the immediate consequence of that in the form of higher taxes.

And your concern about a potential behavior is actually a behavior we see right now even with no balanced budget amendment. Politicians already pass future spending obligations out of political expediency. Things like Obamacare don't fully kick in until after the next election cycle.

Also I'm not sure why it would necessarily mean automatic tax increases though, since the spending obligations shouldn't be automatic either and each annual budget has to be voted on (which would mean spending obligations could be dropped). The balanced budget amendment should mean that either a balanced budget is passed, or none at all.

(Edited by John Armaos on 8/06, 12:27pm)

Post 24

Saturday, August 6, 2011 - 2:58pm

John, just consider the big entitlements. Pretend the budget is balanced and life is good for awhile. Then suddenly there's not enough money to cover the entitlements, and it's only going to get worse. Congress has a choice. Cut the entitlements, or increase taxes. You say that spending shouldn't be automatic and each annual budget has to be voted on, but do you really think that reducing the payouts for these entitlements wouldn't be considered a cut? As the spending is being debated, do you think politicians are going to pretend that they aren't really reducing benefits because spending shouldn't be automatic? Would the mainstream media go along? Of course not! They'd scream that the politicians are going to starve old people, and force them back to the days where they had to eat pet food. They'd scream how the politicians are throwing the elderly and infirm off the cliff so that millionaires don't need to pay their fair share.

Entitlements are just one example. The same would be true if education dollars were reduced, or if war-funding got reduced, or if any other program were reduced in benefits. If we're talking about real world issues, there's no room for wishful thinking. You might desire a system where decisions are made each year with no regard to past promises/obligations/expectations. You might want a system where people don't compare what the government provides today with what they provided in the past. You might prefer a system where people look at the net spending of a program instead of the benefits provided by it. But none of this exists today, and a balanced budget requirement is unlikely to shift people's view.

Simply requiring a balanced budget each year does not prevent future spending. Congress could still pass bills setting up automatic spending for the future, just as there already exists programs like social security and Obamacare. Each year in the future the budget will need to be balanced, forcing Congress to actually increase taxes, or to cut existing programs. You have this idea in your head that each year Congress will look at its money and decide what gets spent that year. But that is unnecessary. Previous spending obligations could still exist, and Congress would only be required to vote on any changes. Even if Congress had to explicitly pass all of each year's spending, politically there would be no difference. It would still be viewed as a benefit reduction.

And the balanced budget amendment has another flaw. It only requires that actual spending each year is balanced. So any bills that deal with future spending, like Obamacare, could be debated and passed without any consideration for how it will be funded. Only spending in the present year would need to be balanced. If I were a typical politician, I'd shift my spending habits so every program starts in the next year so I could make all kinds of promises and give gifts to my constituents, and only later will I have to worry about funding it....and by that point it will be a bipartisan obligation. Even if they cut the program for lack of funding, I can tell my constituents that I passed it, and those greedy politicians from the other party cut it.

John, I understand your point that deficit/debts are simply a form of taxation, and in many ways a worse form. I agree. As I said before, if all else were held equal, that would be a much easier debate. But the rest isn't equal. A balanced budget amendment would have many different effects, some of which might encourage spending increases. The optimistic view that it would create more responsibility by directly connecting spending to funding is almost certain wrong. The more likely result is that spending continues normally (or possibly shifted out one year in time), and at the end of the fiscal year Congress is required to balance the budget. Spending and funding would still be separated in time, and treated as two distinct decisions. Only the funding part would have a Constitutional requirement to cover all of the spending, forcing a bipartisan decision to either reduce spending or increase taxes. This would probably result in a yearly crisis, and who knows how it would be resolved. History may suggest its easier to increase taxes than to decrease spending, so perhaps at the end of the year Congress will just routinely increase taxes.

However it works out, it's wrong to simply assume that the only effect is that deficit-spending is replaced by taxation.

Post 25

Saturday, August 6, 2011 - 5:24pm

Carefully defining what is meant by "spending" and including a cap on all spending as a percent of GDP in the balanced budget amendment would prevent the continuing increase in taxes as a way to balance the budget.

I'm also sure that there is a way to prevent the passage of spending bills that take effect in the future that don't include funding provisions and those funding provisions couldn't result in an out of balance budget or exceed the cap.

Putting these in the constitution would take it out of the hands of congress who might otherwise just change the rules and would prevent a lot of the failures in the past attempts to limit spending.

The trigger and penalty aspects of the amendment could prohibit the use of any use of tax revenues increases and require spending cuts as the only cure.

I am in favor of an amendment containing the features mentioned above, but I'm not naive enough to think we could elect progressives or crooks or idiots and then expect them to be contained by even the best worded of amendments. The real problem is who is sent to Washington, and that problem is caused by the motivations and knowledge levels of the voters.

When we do have the a majority of fiscal conservatives in place, the best tactic is to totally eliminate whole departments, appoint the right supreme court justices as the opportunity presents itself, and eliminate ways for the government to get money that isn't directly visible and painful to voters (like a consumer sales tax to replace all income/payroll/inheritance taxes). Balanced budget amendment is to stop deficit spending and cap total spending, and eliminate the FED to help with that and to reduce the use of inflation as a form of spending money they don't have.

Post 26

Saturday, August 6, 2011 - 5:57pm

Steve, I wonder how much of this would actually go into any proposed balanced budget amendment. Some doesn't seem possible.

Consider entitlements again. Take social security. We know the burden is growing. Even with the "social security lock box" fiction, it'll be out of money soon. You could imagine trying to pass a tiny subset of what you listed. Create a bill that says the amount of money going out of social security must be equal to that which comes in. As more people go onto social security and the payroll taxes are unable to keep up, the benefits would have to automatically scale down. Do you think this would pass in Congress? I don't.

Your suggestion that future spending bills would also have to be fully funded would likely either make social security unconstitutional as is, or it would be forced to do what I just described. If you can't pass a simple bill that just does that one thing, how easy will it be to pass a bill that does a lot more than that?

It might be fun to ponder how to engineer a constitutional amendment to work well, but the more details you add, the more difficult it'll be to pass. If you created a libertarian dream bill, don't you think the Statists would fight it tooth and nail?

It seems more likely that if anything passes (unlikely), it'll end up a simple requirement to have a balanced budget by some artificial standard (like basing it on projected "revenue"). It might get rid of deficit spending, although even then there'll likely be ways of getting around it. And it's major accomplishment will be to create a yearly crisis where bipartisan support will be needed. I can imagine they spend and spend on all of the ridiculous stuff, and at the end of the year they'll point out that critical expenses (like the court system or defense) are unfunded and need an emergency tax increase to cover. Repeat the next year, etc.

Anyway, my point from the beginning was that it might sound nice to have a balanced budget amendment, but the details are critical and it'll likely have significant unintended effects. Could it still be a net positive? Sure. But if such an amendment was effective at what we want, it almost certainly wouldn't pass.

Post 27

Saturday, August 6, 2011 - 6:17pm

SW: "But I totally disagree that we (and I'm not sure who Michael is including when he refers to "us") are either creating a crisis or engaging in dishonesty. I don't think that was what he was referring to. "

Right, I was not thinking of that when I posted. I only meant that we can move the window. I did not intend that we should create a crisis and seize power... though... what is "going Galt?" Have you read The Secret of the League by Ernest Bramha and The Driver by Garet Garrett. This is an old idea. You might point out that you do not want to seize power; and neither do I. But if you read Atlas Shrugged, after bringing about the collapse of society, the heroes re-wrote the Constitution. What does that sound like to you?

To my knowledge, the Fabian Socialists did not intend to create crises but only to move Britain (and the world) to socialism slowly by reforms, rather than by open revolution.

Do you know of any "right wing fabians"? In other words, no one from conservative to libertarian advocates half-measures and compromises? (In Congress, the situation is different, of course, but they do not advocate compromise.) I think that of Ayn Rand's many teachings that "took" was her essay "Anatomy of a Compromise."

Post 28

Saturday, August 6, 2011 - 6:57pm

Joe,

I agree with what you are saying. And you'll note that one of major points in my post is that our problem is who we send to Washington.

If we knew that we would ALWAYS elect a strong majority of honest, competent people who supported capitalism, the Balanced Budget Amendment wouldn't be needed. If we worry that there might be a congress that falls short of that standard, but still aren't that bad, all the amendment would have to say is, "Congress shall not permit the federal goverment to spend more than it takes in. Any deficit shall be corrected with spending cuts designed to correct deficit within one year of the overspending." Honest people who respect the constitution wouldn't need more than that. And a bunch of crooks, incompetents, and progressives wouldn't pass anything that limits their power and if was already in place they wouldn't honor it.
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Entitlements have to be eliminated. Something like social security and medicare can be modified with a means test, an increase in the starting age for everyone who is still 15 years away from the current starting age, and then after that block-grant it to the states and diminish it each year by 5%. That hurts no one who paid in for their working life and now are too old to have any alternatives. There are lots of ways that it can be eliminated in a reasonable amount of time.

Welfare (corporate subsidies, bailouts, unemployment, etc.) should just be ended. Some departments would generate huge savings by elimiinating them - like HUD.
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The amount of economic/political knowledge and the intensity of motivation of those who are fiscally conservative will determine who is elected and that will determine what we can reasonably expect to get passed. That is the area where we may be making progress - we'll see in 2012. The 2010 elections made an enormous change, but didn't nearly get the job done - more like just starting it. The next election has the possibility of moving things much further along. In other words, things that clearly could not get passed in this environment might get passed after 2012.
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It is very frustrating that all of the major changes we need could, theoretically, be made in a few weeks if everyone in Congress was in agreement - it isn't like the mechanics are the problem. But the changing of the entire political environment (getting rid of elected crooks, progressives and idiots)) is going to take a long time - maybe a decade of elections to just make them a small minority - and only if things go reasonably well.

And making the changes to the educational system so that over time a generation of well educated people replace the generations of progress-educated people will take much, much longer. Utopia ain't just around the corner.

Post 29

Saturday, August 6, 2011 - 7:08pm

Joe I respect your concerns but I don't see what your describing is any different now, so I don't see how the status quo is better. Without forcing the issue of paying for what the government wants to spend we end up risking an eventual economic collapse, or what we've always experienced, that being a slow and gradual taxation via the inflation of our money supply.

Would the mainstream media go along? Of course not! They'd scream that the politicians are going to starve old people, and force them back to the days where they had to eat pet food. They'd scream how the politicians are throwing the elderly and infirm off the cliff so that millionaires don't need to pay their fair share.

Well if we're going to wait around for what satisfies the mainstream media we don't deserve a country. Point being they do this now, we shouldn't care what they think. Nor is mainstream media necessarily representative of the views of the majority of the electorate. For example most of the people who actually vote didn't want a spending program like Obamacare, even while the mainstream media cheered for it loudly. So I don't have quite as dismal of a view as you have of the electorate. But I'm not a hopeless optimist either. I can certainly see the potential of a balanced budget amendment being rendered irrelevant.

Post 30

Saturday, August 6, 2011 - 7:42pm

Michael wrote, "... if you read Atlas Shrugged, after bringing about the collapse of society, the heroes re-wrote the Constitution. What does that sound like to you?"

It doesn't sound like a government that is violating individual rights in ways that create a crisis that will allow them to go beyond the Overton Window and pass more totalitarian laws then they could have gotten away with inside the Overton Window. Going Galt consists of acting within individual rights. It is in response to those that are violating rights using the government. Rewriting the constitution to make the constitution more in line with individual rights would not be considered "seizing power" - unless you mean power to protect rights and power to prevent violations of rights.
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Obama has been using crisis to transform us towards socialism by reforms rather than an open revolution. (Not that I wouldn't expect minor elements of open revolution as a tactic to bring about changes - like large and even violent demonstrations, not to overthrow the existing government, but to pressure legislative reforms - like the unions demonstrating in thuggish fashions to bring about legislative changes).

We have been moved by crisis many times - and the tactic has been almost constantly in play with Obama and his scare tactics.
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Technically, "right wing fabian" is a contradiction in terms historically - and practically in the U.S., but not in necessarily in Europe where 'right wing' has a different meaning. Metaphorically it works somewhat, but is confusing. It would be anyone who was pushing for more centralized control and a planned economy as long as they wanted to transform their government from a mixed economy or capitalism towards a Nazi government without a violent overthrow.

This concept has nothing to do with compromise. Fabian Socialists compromise on details constantly, but only where they see some movement towards socialism (which is what they won't compromise) - that is, towards bigger government. A libertarian congressman will compromise in the same sense - he will vote for a bill that lowers the tax rate even though it isn't by as much as they wanted and if he voted for higher taxes it would only be because he got some deal that moved us closer to minarchy in some other area, further than it hurt via taxes. Again, it is a compromise on the details but not on the underlying principle. A voter might vote for a third party candidate who has NO chance of winning - but that isn't necessarily to avoid a compromise, but rather a technique to push that Overton window, and to pressure the major parties to put up better people. You can't even define "compromise" without understanding the context and that includes the motivation. You can spot the libertarians and the different kinds of socialists because they may or may not compromise on a given detail, but not on the basic principles.

Post 31

Saturday, August 6, 2011 - 7:52pm

John, I agree that much of what I mentioned is not very different from what we have today. That was the point of describing it. Balanced budget might seem like it'll solve lots of problems, but we can be pretty sure most of the same issues will plague us. Instead of combining spending and funding into a single decision where the spenders will be held accountable, we'll have more of the same old thing where spenders spend and the funding is viewed as a completely separate event. Just like the debt limit crisis is still being described as the fault of the Tea Party, instead of the people who spent so much that the old limit was reached.

Aside from the same old thing, there are some major differences. One, of course, is that the deficit spending would presumably end (although they'd probably find some way around it, like making an exception for military and then putting the entire defense budget into the deficit spending category). That leaves taxation or spending reduction. My argument is that tax increases will become less of a political burden. The cost right now is if one party increases taxes, they'll probably lose power in the next election. But if it is bipartisan, the political cost goes away. Forcing budget balancing could force it to be bipartisan. I'm wary of decreasing the political costs of irresponsible spending.

It's impossible to be sure how it'll play out. Maybe the government will suddenly decide to reduce spending. Maybe tax increases will be just as difficult. Maybe it won't create strange new incentives. It's hard to say. But I won't just assume that it'll all work out for the best because I want it to. I won't assume government will suddenly become responsible and pass an amendment that forces government to be responsible. I won't expect that it'll suddenly become easy to cut programs. A constitutional amendment is a huge deal. It can't be based on wishful thinking.

Post 32

Saturday, August 6, 2011 - 7:55pm

John,

"Well if we're going to wait around for what satisfies the mainstream media we don't deserve a country."

Nice turn of phrase!
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"Nor is mainstream media necessarily representative of the views of the majority of the electorate."

There is a new book out, Left Turn: How Liberal Media Bias Distorts the American Mind, an academic study of media bias written for the lay market, that shows an enormous liberal bias in mainstream media and how it has effected voting outcomes.

It includes the statistic that 93 out of every 100 correspondents and journalists in Washington, D.C., vote democratic. It also showed that even Fox news is slightly to the left, on average, of those who self-identify as conservative in the population. Presumably due to the force of the liberal mainstream media.

Post 33

Sunday, August 7, 2011 - 4:21pm

John said:

Well if we're going to wait around for what satisfies the mainstream media we don't deserve a country. Point being they do this now, we shouldn't care what they think.

Just to be clear, I wasn't arguing that we have to convince mainstream media or anything like that. I was responding to John's argument that spending shouldn't be viewed as automatic, since it would (under some imagined version of the amendment) need to be revoted on each year. So if funding for a program dropped from one year to the next, you can hold to the fantasy that it wasn't a spending cut because there was no future obligation to hold the spending to the same level (there is also the point that a reduction in actual benefits can exist even if total spending is kept the same, due to inflation or a larger pool of recipients).

The point was that tax increases would be weighed against spending cuts. John was trying to define away the spending cuts by saying that each year can be thought of as starting from scratch, with no past obligations. That's not how it is viewed today, and it's unlikely to be viewed that way in the future. It would be viewed as a spending cut.

Remember that we're talking about political costs. A politician will be forced to make a choice between increasing taxes, or reducing spending or benefits. Saying that you would like people to think of it another way is irrelevant. Saying that "we shouldn't care what they think" ignores the fact that politicians do care what voters think and should care. People will see less spending than the previous year as a spending cut. If politicians vote for this spending cut, it can and probably will hurt them in terms of votes.

In purely philosophical discussions, you can talk about moral ideals and how things should work. You can say it doesn't matter what people think, and we shouldn't care, because what is ideal is not dependent on what they think. But when you start talking about choices in the real world, there's no room for saying things like "we shouldn't care what they think". If what people think impacts the consequences, we better care! If your going to argue for a real political position, you can't just pose morally and ignore the results. In this case, the topic I brought up is how this kind of amendment would change the political costs, which revolves heavily around what other people think. Ignoring that is to stop talking about what the consequences will be, and instead to start talking about what you'd like the consequences to be.

Finally, I did not make any statement about the mainstream media being representative of the views of others. I used it as just one example of how people will not simply pretend a spending cut is not a spending cut because you prefer the illusion of each year being viewed in isolation. They are an obvious example of a group who doesn't have the same ideological urge to pretend that spending cuts aren't spending cuts. But I would expect even people without that urge aren't going to be fooled.

Post 34

Sunday, August 7, 2011 - 4:56pm

Joe:

Just to be clear, I wasn't arguing that we have to convince mainstream media or anything like that. I was responding to John's argument that spending shouldn't be viewed as automatic, since it would (under some imagined version of the amendment) need to be revoted on each year. So if funding for a program dropped from one year to the next, you can hold to the fantasy that it wasn't a spending cut because there was no future obligation to hold the spending to the same level (there is also the point that a reduction in actual benefits can exist even if total spending is kept the same, due to inflation or a larger pool of recipients).

Joe I think you're over-complicating the issue. If the congress were to pass a future spending obligation years down the road, I don't know why it would mean an automatic tax increase since a budget each year still has to be voted on, and that vote would require a sanction of the continuation of that spending obligation or an elimination of it or a fractional cut of it. I don't really believe there is any such thing as automatic legislation since it simply requires new legislation to be voted on to repeal the previous legislation.

The government has cut budgets before, why would you now assume this is forever an impossibility with a balanced budget amendment? I don't quite follow you here. In fact, spending cuts seem to be what the majority of the electorate favors right now.

Saying that you would like people to think of it another way is irrelevant. Saying that "we shouldn't care what they think" ignores the fact that politicians do care what voters think and should care.

Joe I think you're confused by whom I was referring to here. I was referring to the mainstream media when I said we shouldn't care what they think, because I don't believe it's necessarily true their opinions is representative of the electorate. Take the tea party caucus for example, their constituents' opinions are by no means representative of the mainstream media. I did not say that politicians whom rely on their constituents for re-election should not care what they think. I'm not ignoring consequences here, I'm saying there is no use in trying to satisfy the whims of an irrational media.

I used it as just one example of how people will not simply pretend a spending cut is not a spending cut because you prefer the illusion of each year being viewed in isolation.

But, you are assuming this is viewed so much as a negative by the electorate to the point they would continuously favor tax increases. I don't think that's necessarily true. Plenty voters favor spending cuts.

I think you are placing a lot of assumptions here on the electorate that are incomplete or at least a hasty generalization of it.

(Edited by John Armaos on 8/07, 5:09pm)

Post 35

Sunday, August 7, 2011 - 5:43pm

John:

Joe I think you're over-complicating the issue. If the congress were to pass a future spending obligation years down the road, I don't know why it would mean an automatic tax increase...

I think you keep ignoring the point, and now are mischaracterizing what I've said. I repeatedly pointed out that Congress will need to make choices between spending cuts and tax increases. You tried to ignore this by saying that they aren't technically spending cuts, since there are no future spending obligations. Each year's spending is viewed in isolation. As I said, this is an illusion and it's a mistake to assume anyone is going to buy into it. Intentionally ignoring the differences from year to year is something that requires an ideological motivation. You may have reasons to ignore it, but not everyone does.

And I didn't say the tax increase needed to be automatic. I said the choice will be between tax increases or spending cuts. You might wish that spending cuts were the normal, or even automatic, method of dealing with it. But there is a real political cost to spending cuts. Pretending that they don't exist and hoping that everyone will go along with that pretense is not a serious response.

The government has cut budgets before, why would you now assume this is forever an impossibility with a balanced budget amendment? I don't quite follow you here. In fact, spending cuts seem to be what the majority of the electorate favors right now.

Budget cuts are theoretically possible, but the reality is that they are exceedingly rare. Even the recent cuts are mere cuts in the growth of spending, and they're back-loaded to the end of the decade, so we'll see if they even exist at that point.

As for the majority of the electorate favoring spending cuts, that comes off as very naive. People have been in favor of less government spending for a long time, but they can't think of any particular program to cut. It's not enough to be vaguely in favor of smaller government. There has to be real government spending you're willing to give up on. And if you're talking about actual spending cuts, you have to have areas that are widely agreed on. The programs people are willing to cut back on are miniscule.

I can't believe anyone who has followed politics at all can reasonably believe that spending cuts are easy or likely.

Joe I think you're confused by whom I was referring to here. I was referring to the mainstream media when I said we shouldn't care what they think, because I don't believe it's necessarily true their opinions is representative of the electorate. Take the tea party caucus for example, their constituents' opinions are by no means representative of the mainstream media. I did not say that politicians whom rely on their constituents for re-election should not care what they think. I'm not ignoring consequences here, I'm saying there is no use in trying to satisfy the whims of an irrational media.

Since I never said or implied anything like that, you can understand why your statement might be confused.

I think you are placing a lot of assumptions here on the electorate that are incomplete or at least a hasty generalization of it.

I have to say, anyone who thinks that spending cuts will be easy and popular seems to be making an incomplete and hasty generalization. Talk is cheap. Making real cuts is proven to be next to impossible. Thinking the political reality has changed so much is optimistic.

Post 36

Sunday, August 7, 2011 - 5:46pm

By the way, I don't think a balanced budget amendment would solve all of our problems, as if it is a solution to all of our problems, that it would mean spending programs would be cut wholesale and we would magically have the lowest tax rates in the world. I am saying I tend to think it is an improvement over the status quo, and I don't think that's wishful thinking either as you said Joe. I do think it's perfectly rational to expect it would mean an overall reduction in spending because at the very least it would preclude debt payments as part of that spending, and at best would favor smaller government spending in lieu of continuous raises in tax rates.

Post 37

Sunday, August 7, 2011 - 6:07pm

Joe, sorry but discussing this with you is getting to be a bit frustrating, I think maybe we're talking past each other?

I'm saying even if these future spending obligations if eliminated were considered a cut, there are sill political consequences to raising taxes, or not cutting spending. You shouldn't ignore one political cost and focus exclusively on the other.

And I didn't say the tax increase needed to be automatic. I said the choice will be between tax increases or spending cuts. You might wish that spending cuts were the normal, or even automatic, method of dealing with it.

Well that's the point Joe, it's not now because another mechanism is available, borrowing. If you took that out of the equation, you assume the tendency would just be to raise taxes instead of cutting. And I don't think you're right. It would be a different paradigm.

But there is a real political cost to spending cuts. Pretending that they don't exist and hoping that everyone will go along with that pretense is not a serious response.

I never said there is no political cost to cutting. But, it also wouldn't be serious to assume there is no political cost to passing a new spending program, or raising taxes. With a balanced budget amendment, you may very well be faced with two unpopular options, cutting spending or raising taxes, and restricting the now current popular option, the political expediency of borrowing. By elminating that, you are forcing the hand of politicians, and the electorate, between two options they may not find as palatable, and that's how it should be, because this forces everyone to confront reality rather than evade it. Maybe this is simply a problem with the electorate not looking at reality with any long-term consequences, in which case then force the issue on them and make the consequences immediate, because the other option, evading reality today by borrowing against the future and facing an eventual economic collapse (or continued inflation, even the risk of hyperinflation) is untenable. And raising taxes or proposing new spending have serious political consequences that I think you are not giving enough consideration to. You are fixated on just the aspect of cutting a program and ignoring the political cost for raising taxes or proposing a new spending program to begin with. The entire Obamacare legislation, which was a future spending obligation, cost the Democrats politically so dearly that they lost the House of Representatives. Ignoring this I believe is not taking this issue seriously. Please acknowledge this point or tell me why I'm wrong, but please don't ignore it.

I have to say, anyone who thinks that spending cuts will be easy and popular seems to be making an incomplete and hasty generalization. Talk is cheap. Making real cuts is proven to be next to impossible. Thinking the political reality has changed so much is optimistic.

This is annoying and obnoxious. I could easily quip back you're a cynical pessimist, but there would be little value in that, as I expect a higher caliber of reasoning from you. It's a strawman to say I'm saying it would be 'easy' or 'popular'(as if increasing spending and raising taxes would somehow be also be simply 'easy' and 'popular', which is preposterous. Politicians have been skewered in campaigns for having raised taxes, Bush's reneging on "No new taxes" pledge had political consequences, the Tea Party caucus was elected specifically on the platform of not raising taxes. Please either acknowledge this point and the corresponding real world examples I provide or tell me why I'm wrong to think it, or else I don't see any point in having this non-conversation), but the problem we have now is, it's too easy NOT to do any cutting because you can simply borrow. By restricting this option, you force a decision between either raising taxes, or cut spending. Now we have the problem of continuously raising spending with little short-term consequence to it, which means simply evading the reality of an eventual tax increase anyways or an elimination of the spending program. I don't why you ignore this reality and think borrowing itself doesn't lead to the eventual necessity of either raising taxes or cut spending.

So considering this reality, let's get serious! Here are your options, a government that is permitted to continuously increase spending and put the government into debt whose consequences will eventually mean more taxes, cut spending or inflation, or a government that must balance its budget. Given reality is between available choices and not what we wish it to be, which do you think is the better choice? So far the notion that this balanced budget amendment would be worse, or not better than the status quo, is untenable.

(Edited by John Armaos on 8/07, 8:52pm)

Post 38

Sunday, August 7, 2011 - 6:28pm

Joe, I originally wrote:

Joe I think you're confused by whom I was referring to here. I was referring to the mainstream media when I said we shouldn't care what they think, because I don't believe it's necessarily true their opinions is representative of the electorate. Take the tea party caucus for example, their constituents' opinions are by no means representative of the mainstream media. I did not say that politicians whom rely on their constituents for re-election should not care what they think. I'm not ignoring consequences here, I'm saying there is no use in trying to satisfy the whims of an irrational media.

You responded:

Since I never said or implied anything like that, you can understand why your statement might be confused.

I don't think I'm confused, I think what's more likely is that you're backpedaling from your original argument. Your implication was that politicians were beholden to the opinions of the mainstream media. You originally wrote:

As the spending is being debated, do you think politicians are going to pretend that they aren't really reducing benefits because spending shouldn't be automatic? Would the mainstream media go along? Of course not! They'd scream that the politicians are going to starve old people, and force them back to the days where they had to eat pet food. They'd scream how the politicians are throwing the elderly and infirm off the cliff so that millionaires don't need to pay their fair share.

This certainly sounds like to me you are saying politicians should be concerned with what the mainstream media says, because if they don't they suffer consequences from ignoring them.

And it seems you ignored my point, and wrote:

Remember that we're talking about political costs. A politician will be forced to make a choice between increasing taxes, or reducing spending or benefits. Saying that you would like people to think of it another way is irrelevant. Saying that "we shouldn't care what they think" ignores the fact that politicians do care what voters think and should care.

This is what I mean by talking past each other. You quote me "we shouldn't care what they think" and then attribute this quote as meaning that politicians should not care what their voters think, when actually I was referencing the mainstream media, not the voters.

I don’t appreciate nor find any value in a discussion where previous points are brushed aside, or its meaning twisted, or not considered 'serious' (which I think is a form of intimidation) for fear of either conceding the point or acknowledging one’s own inaccurate statement.

(Edited by John Armaos on 8/07, 9:34pm)

Post 39

Sunday, August 7, 2011 - 7:23pm