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Tuesday, April 5, 2011

E.J. Dionne on the end of progressive government

Americans are about to learn how much is at stake in our larger budget fight, how radical the new conservatives in Washington are, and the extent to which some politicians would transfer even more resources from the have-nots and have-a-littles to the have-a-lots.

And you wonder: Will President Obama welcome the responsibility of engaging the country in this big argument, or will he shrink from it? Will his political advisers remain robotically obsessed with poll results about the 2012 election, or will they embrace Obama’s historic obligation — and opportunity — to win the most important struggle over the role of government since the New Deal?

It is that important. Read the entire article here. Read the entire article here.

The Ryan budget’s central purpose will not be deficit reduction but the gradual dismantling of key parts of government. Remember that Ryan wants both to preserve the Bush tax cuts and, over the long run, to enact more breaks for the wealthy, including the elimination of the capital gains tax.

The Republicans have an economic theology, not and economic policy.

The private sector can do no wrong, government can do no right. Have these people seen "Inside Job", a film that is essential viewing. The government stood aside and let the private sector, in this case the financial world do its thing. The result was an economic catastrophe that could still get worse.

All tax cuts are good, all tax increases are evil. Part of the Budget amendment passed by the House last week would require a two thirds majority to raise taxes. That's worked really well in California where even a relatively small Republican minority has blocked every attempt to raise taxes, paralyzing state governing.

Lower taxes for the wealthy and for corporations create more jobs. G.E. has gamed the system so well they never pay taxes but still get additional tax credits. In the past 9 years they have cut their workforce by 20%. Enough said.

All regulations are bad. Deregulating the derivatives markets really worked out well. You'd think the Republican would have learned something by now but instead they want to double down, repeal finance reform and do the same dance over again.

Lower taxes actually create increased tax revenue. They want to do away with corporate taxes, capital gains taxes and estate taxes. Where will the additional revenue come from, the middle class? The same people who have seen their job security evaporate and the value of their homes plummet because of the profligate insanity of the financial world. It didn't work with Reagan's tax cuts, it didn't work with Bush's tax cuts. Maybe third time will be lucky.

Republicans are fiscally responsible. Prior to the Obama administration, 87% of total federal debt since the founding of America was created by Reagan and the two Bush administrations.

The minimum wage stifles job creatoin. No study has ever shown that. What the minimum wage has done is help a lot of people either escape poverty or at least get by.

High corporate tax rates stifle job creation. Republicans complain the the 35% corporate tax rate does just that and is the highest among Western economies. While that may be true large corporations almost never pay that rate. Last year only 1 company in the Fortune 500 paid 35% percent. Two thirds of them paid no taxes whatsoever despite American corporations earning record profits. Over 15,000 amendments have been passed to the tax code since the last major reform. Almost all of them are tax breaks for corporations or rich individuals. The current tax system perversely hurts smaller corporations who do don't have the same clout in Washington.

Ryan's plan is a radical reworking of America conform to Republican's wet dreams. They want to privatize Medicaid and give block grants to states to decide how best to deal with it. They think giving vouchers to buy Medicaid through private insurance companies will cut costs because the private sector always does it better. States will have no choice but to limit services in this madcap scheme or risk financial disaster. That way, the wealthy will be able to pay for additional coverage and for the rest of us it's 'death panels' here we come.

Dionne ends with this:

“This is our time,” Obama liked to say during the 2008 campaign. This most certainly is his time to stand up for the vision of a practical, progressive government that he once advanced so eloquently.

Obama has a heavy load. I don't envy being him. The Republicans are very good at staying on message and framing the message artfully. Trying to negotiate with them is a losing proposition. Republicans have declared war on sanity. You can't reason with that. Their economic theology has has no basis in reality. It's a one size fits all policy, whether the economy is growing or contracting, the solution is the same. All the above highlighted principles apply no matter what the conditions.

The Republicans have been involved in a class war for the past 30 years yet any criticism from the left is met with the accusation that the left is advocating a class war. It's time to take the gloves off. There are obvious signs that the Republicans have already overreached. Wisconsin is the prime example but their are more than a handful of other states are feeling the same overreach and are reacting in similar though not as vociferous a manner. Newly elected governors with compliant state legislatures are passing laws that can only be described as dictatorial. In Florida a bill giving the governor's administration to declare any of over 11,000 state regulations invalid without a vote. Enough said.

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