Starving -- or Feeding -- The Beast?
Spending to prosperity or oblivion?
By ROBERT A. GEORGE
Updated 12:58 AM EST, Fri, Jun 5, 2009
Will the "beast" slouch to the right or left?
Fed Chairman Ben Bernanke, who tends to speak in more complete, understandable sentences than the guy who had the job before him -- Alan Greenspan -- delivered a statement to the Congress this week on the impact of the nation's increasing debt-burden. "Unless we demonstrate a strong commitment to fiscal sustainability in the longer term, we will have neither financial stability nor healthy economic growth," Bernanke warned.
The statement suggests that the nation's decades-long affair with spending beyond its means may have reached an end. In doing so, it may finally resolve who, ideologically is right about deficit spending.
During the '90s and early parts of this decade, conservatives candidly admitted that in addition to an economic reason for cutting taxes -- stimulating growth -- there was also a political one. Assuming that Congress wouldn't have the appetite for cutting spending commensurate with the cuts in taxes, annual deficits would grow -- and with them, the overall debt. Long-term, of course, such behavior was unsustainable. Nations can't keep turning on the red-ink tap. Eventually, it would have to come to an end. From the perspective of conservatives though, this is a good thing. Since lawmakers wouldn't shrink the government unless forced to, creating so much debt that the only option would be to cut spending would create the desired effect of the smaller government conservatives.
This strategy was called "starve the beast" -- the "beast" being the federal government.
Within the first few weeks of the Obama administration, policy analysts on the Left started speculating that the new president might be trying an inverse version of the beast maneuver:
Obama's spending proposals would effectively reverse that dynamic - they would create new spending commitments and run up large deficits, in the hopes that the dollars poured into health care and education will create a new baseline for government's obligations, which in turn will create the political space for tax increases on the middle class. Like the starve-the-beast approach, the Obama strategy puts off the hard part till tomorrow: Give them tax cuts today, conservatives said, and they'll swallow spending cuts tomorrow; give them universal health care, universal pre-K, subsidies for green industry and all the rest of it today, liberals seem to be thinking, and they'll be willing to pay for it tomorrow.
Robert A. George is a New York writer. He blogs at Ragged Thots.
Copyright NBC Local Media
First Published: Jun 4, 2009 7:34 PM EST
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