Economy & Business

Just Stop Spending

President Trump in the White House, Washington, D.C., March 14, 2019 (Jim Young/Reuters)
Under the budget just proposed by President Trump, we’re not only spending money we don’t have -- we’re spending money we don’t want to have.

Stop spending money you don’t have, dummy.

Can we conservatives agree — at least among ourselves — on that much?

Maybe not.

Confession: I am not much of an ideologue. And I don’t think “Stop spending money you don’t have, dummy!” is an ideological position, exactly. And there’s no need to be fanatical about it: Running a deficit during a serious economic downturn, a war, or a national emergency? I’m flexible. You show me Hitler invading Poland and my response is not going to be: Stop spending money you don’t have, dummy.

Whip those Nazis. And, then:

Stop spending money you don’t have, dummy.

The Keynesians say that we should run deficits during recessions in order to goose demand and keep the economy hopping. There are economists I respect who believe that and economists I respect who are critical of that prescription. Get back to me on that the next time we’re in a recession and I’ll get into that at length. Until then:

Stop spending money you don’t have, dummy.

Because, here’s the thing: The economy is doing pretty well, I’m reliably informed. President Trump is on his phone all damned day talking about work-force participation and GDP growth. (Not so much about the trade deficit.) And no one is better pleased by this than I am. People are working, wages are growing. I love to see it. So:

Stop spending money you don’t have, dummy.

I don’t know if Keynesian deficit spending works, but I am pretty sure that the idea is supposed to be that you do that kind of stimulus spending when the economy is lagging. But we run deficits when the economy is up, down, sideways, at ease, nervous, overconfident, sweaty, feeling a bit of a chill, singing Elvis Costello songs at late-night karaoke sessions. If the economy could hop on one foot while singing the national anthem of Burkina Faso (“Against the humiliating bondage of a thousand years / Rapacity came from afar to subjugate them for a hundred years!”), we’d run a deficit while the economy was hopping on one foot and singing the national anthem of Burkina Faso (“Against the cynical malice in the shape of neo-colonialism and its petty local servants!”).

Of that much I am confident. But I would prefer that the powers that be in Washington would instead:

Stop spending money you don’t have, dummy.

For pity’s sake: Under the budget just proposed by President Trump, we’re not only spending money we don’t have — we’re spending money we don’t want to have.

A goodly sum of the revenue in the Trump budget projections comes from Obamacare taxes — which the administration and congressional Republicans want to see repealed. As predicted by your favorite correspondent way back when the bill was being debated, some of those politically unpopular taxes have never been collected, and probably never will. (They are in a state of eternal deferment, like future presidential candidates faced with service in Vietnam.) That was some vintage Obama-era CBO-score bullsh** that has been reincarnated as Trump-era CBO-score bullsh** — because eternally reincarnated bullsh** is the only thing in Washington that is truly bipartisan.

Stop spending money you don’t have, dummy.

Republicans love tax cuts. Tax cuts are why God set Republicans wandering on this earth in their Cole Haan loafers. But the Trump budget assumes some tax increases as such GOP-beloved business-friendly tax measures as immediate deduction of capital expenses expire and go bye-bye. Like the Obamacare taxes, those tax increases probably are not going to happen. As the Committee for a Responsible Federal Budget runs the numbers, about $1.2 trillion of the Trump budget’s future revenue comes is CBO-score bullsh** — or “phantom revenues,” as the Wall Street Journal delicately puts it.

And even with that CBO-score bullsh**, the budget would add $7.3 trillion to the debt between 2020 and 2029.

Stop spending money you don’t have, dummy.

The last time we had a surplus, tax revenue was 18.8 percent of GDP and spending was 17.6 percent of GDP. That was 2001. Taxes were even higher as a share of GDP in the two years before that: 19.2 percent of GDP in 1999 and 20 percent in 2000. I prefer low taxes, but I don’t remember the tail end of the 1990s as an Orwellian dystopia. If the estimates hold, this year, revenues will be about 16.3 percent of GDP and spending will be 21 percent — with deficits forecast as far as forecasters can see. And that’s while the economy is doing well. Either that tax number moves or that spending number moves — or we have deficits forever, until the creditors call us on our bullsh**.

At which point we will have no choice but to:

Stop spending money you don’t have, dummy.

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