The Conservative "Solution"

Reading David Yepsen's column in today's Des Moines Register ("Stimulus Deal Might Do Harm"), I was surprised to find myself agreeing with the concerns he expressed over things like the growing national debt, borrowing from foreign interests, the falling value of the dollar, and the burden we are placing on our children and grandchildren.

Then I came to source of his concern: the $150 billion tax stimulus package proposed this past week. As usual the facts are distorted and inaccurate. Of the $150 billion, a little over $100 billion will be provided to individual taxpayers. The remainder is designed to provide a stimulus for corporate taxpayers. The "dinky $300 rebate" isn't $300, it's $600 for each individual, $1,200 for working couples, plus an additional $300 per child.

While I agree that this single step isn't the sole answer to the looming recession, I was more concerned by the rhetoric in his column on the supposed "conservative" solution, cutting taxes and spending less.

Wait a minute! Is this another attempt to rewrite history and ignore the fact that the failed Bush policies are how we got here in the first place? Is it possible Mr. Yepsen isn't aware that the national debt which stood at $5.6 trillion in 2000 is projected to be $9.5 trillion in 2008, and that we've almost doubled the amount of debt accumulated during the first 200 plus years of our history in just 8 short years?

Was this caused by spending less? It doesn't seem so. Prior to 2000, total Federal annual outlays never exceeded $1.7 trillion in a single year. Since then, expenditures have increased steadily each year:

2000_______1.789 trillion
2001_______1.863 trillion
2002_______2.011 trillion
2003_______2.160 trillion
2004_______2.293 trillion
2005_______2.472 trillion
2006_______2.655 trillion
2007 est. ___2.784 trillion
2008 est. ___2.901 trillion

What about extending the Bush tax cuts enacted in 2001 and 2003? Well, it doesn't seem like "trickle down" is really working that well, given the current state of the economy. Still, all the Republican presidential contenders have said they want to extend these tax credits, even though they don't expire until the end of 2010.

According to the Brookings Institution, making the tax cuts permanent would reduce federal revenues by almost $1.8 trillion over 10 years — and that's in addition to the $1.7 trillion of revenue losses already locked into law. Evidently, they don't understand "trickle down" either.

What strikes me as odd about all this is the controversy created by giving back a relatively small amount ($100 billion) of tax dollars. And, how can conservatives complain about this with a straight face?

Source: United States Office of Management and Budget
http://www.whitehouse.gov/omb/budget/fy2008/hist.html