Deficit Hawks Proudly Display Their Feathers
Now that Biden has won the election, Republicans are Ready to Become Deficit Hawks Again.
GOP senators say they expect to refocus on curbing the nation’s debt and reforming entitlement programs starting in 2021, as the Congressional Budget Office estimates that the debt has surpassed the size of the American economy.
“I think that’s kind of getting back to our DNA. … I think spending, entitlement reform, growth and the economy are all things that we’re going to have to be focused on next year, and, yeah, I would expect you’ll hear a lot more about that,” said Sen. John Thune (S.D.), the No. 2 Senate Republican.
Sen. Lindsey Graham (R-S.C.) is poised to become the chairman of the Senate Budget Committee if Republicans maintain their majority. He said he wants to create a new commission to propose ways to reduce the deficit and address the country’s debt.
“I think we’ve got to understand that we’re going to be raising the debt ceiling in perpetuity if we don’t find a way to bend the curve,” Graham said.
Amusing or Pathetic?
Is this expected hypocrisy more amusing than it is pathetic or more pathetic than it is amusing?
I am all in favor of fiscal responsibility and would even welcome a balanced budget amendment.
But here we are once again.
Hawks or Turkeys?
I am sure Republicans will proudly show their feathers, but will they be the feathers of a hawk or the feathers of a turkey?
Hopefully you know the answer to that because it will play out the same way it always does.
What The Parties Will Seek
- Democrats will demand tax hikes. Since they won’t control the Senate, they won’t get them.
- Democrats will then demand more money for anything and everything especially social programs.
- Democrats will call for budget cuts in defense spending.
- Republicans will seek more defense spending.
- Republicans will call for cuts in entitlements.
The Compromise
Drum roll please ………
The compromise will be the same one it always is.
There will be no cuts in entitlements nor cuts in defense spending.
Instead, the Turkeys (on both sides of the aisle) will agree to more social spending in return for more military spending.
Mish
The Senate, since early summer, under a Trump regime, has been against the huge subsidies sought by both Trump and Pelosi. Let’s not rewrite history.
Lol! Until the markets start to tank! Then the “bazookas” will come out
LOL C’mon Mish! And you believe them?
When it comes to spending there is really no difference Republican or Demicat money is just wasted on different stuff.
Any wagers what the national debt will be in 4 years. 32 Trillion plus stated. The real debt is probably 2-3 times that….. but what the heck who really cares anyway.
WHY ARE WE PAYING TAXES? Because we are a bunch of _____.
Just print it up!
On a different note why are we counting people that are not citizens in a census that determines the number of representatives ? Do you think the founding fathers would have ever thought that there would be the number of non-citizens in the Country? And that our government should include them in figuring representation?
I guess we will never know but I kind of doubt it. Hey but I could be wrong wouldn’t be the first time.
BTW, even with rates at rock bottom INTEREST – JUST INTEREST ON THE FEDERAL DEFICIT IS MORE THAN OUR DEFENSE SPENDING. Meaning our defense could be entirely covered by what we toss out the window for debt.
If/when interest rates spike what happens when most US tax receipts are needed to cover the debt financing costs and maybe it’s neither guns nor butter? I don’t think interest rates have ever stayed low forever. Will it be federal debt default or dollar devaluation? Hyperinflation will walk everybody up the incremental tax curve and heavy capital gains on inflated assets of all classes (you don’t really think the Dow is justified at 30K,,just trump pumping up his wealth effect votes
Hyperinflation is impossible in any country where their debt is denominated their their own currency. The necessary mathematics to lead to hyperinflation is that, as a government prints more money, the value of the currency falls, and the debt remains the same.
The US does have a certain amount of TIPS bonds, which change in value with inflation, but it is only a small amount, and not enough to make hyperinflation possible. The US could print enough currency to pay off all debts tomorrow, something that is impossible if their debt is denominated in another currency. That would lead to a lot of inflation, but a one-shot inflation, not hyperinflation. Note, however, that if the US did that, in the future if they wanted to borrow, they most likely would not be able to borrow much in USD, and hyperinflation would then become possible.
It is endlessly disappointing that we can never cap defense spending. What is it now, more than the next 5 country’s defense spending combined? Probably worse, whatever it is in equivalency to other countries it is over the top.
I forgot about Green New Deal…another pork barrel…not unlike ethanol…Yeah, that gets funded.
But my guess is the new Republican freshman congresswoman from NY wouldn’t know a . “free market principle” if it smacked her in the face like a mackerel. Another example that we live in a world of convenient shared delusions.
“Instead, the Turkeys (on both sides of the aisle) will agree to more social spending in return for more military spending.”
I think that over time, we will see social spending trump military spending…..although I expect military spending to continue to command an outsize slice of budget pie.
My reasoning is that certain problems, like a medical insurance system that simply does not come close to working for a vast swathe of the public, will be seen as more important to address than a lack of billion-buck-bombers that we don’t need…..although those who profit from bombers have a great lobby……no doubt of that.
I also see rising support for a number of more dubious social endeavors…..aimed (one more time) at leveling the playing field for black and brown people…..really bad ideas like reparations…whch probably won’t be seen in the form of direct welfare payments…..but rather as a variety of ill-considered urban renewal pork barrel projects that will mostly allow insiders and local politicians to make bank.
Maybe some student loan forgiveness…..which I don’t support, for reasons I’ve listed before. Maybe some money thrown at free college, which is a better idea, but the devil is in the details….also likely to be conduit schemes for insiders.
More aid to states for Medicaid is likely. In some states enrollment in Medicaid is up double digits this year. The money has to come from somewhere to fund it.
My biggest fear is that a Republican senate will be more of Mitch McConnell doing nothing – just say No. Congress has a role and it is time that it started acting like it – actually sitting in a room and negotiating with the other side – hopefully without the lobbyist. Most of the issues facing the country are not so complex – yes tradeoffs that make us all unhappy but you do once and the issue gets put aside for a few years – health care, infrastructure, entitlement programs.
While having Mitch “just say no” would be fine with me, that’s not what I expect. What happens is that if the government is split, with a President of Party A, and Party B controlling one of the houses, Party B has more power than you would expect, because they must be appeased in order to pass anything.
So, with Pelosi in charge of the House, and Trump in the White House, Pelosi generally got much of what she wanted. What did she want? Mostly she wanted to prevent Trump from accomplishing anything, but wanted to look like it wasn’t her fault. Thus, she passed a bill that she knew was unacceptable before she did it, and then refused to compromise, resulting in no bill at all, which was her goal.
What will Mitch do (if the Republicans win at least one Georgia seat)? It depends. What is his goal? That we have to guess at. I think he will, like Pelosi, want to keep Biden from accomplishing a lot. That leads to the conclusion you reached, that Mitch will “just say no”. On the other hand, Biden is much better than Trump at compromise, so Biden will try to enlist a few Republicans here, a few there, to get some bills through, and McConnell knows a block of 51 will not stay together every time. Thus, he will be forced to compromise more than Pelosi, who had a strong majority, was.
Thus, I conclude we’ll see some things getting through, and they will be things that meet certain Republican needs, but which also meet Democrat needs. I have no problem with that, either.
Off-topic, but interesting….Remember how I predicted that after North Dakota instituted a mandatory mask order on November 14th, that we would see their neighbors in South Dakota (where the governor isn’t so sure about masks) continue to get hammered by COVID while North Dakota’s numbers got better.
Nice experiment….at some point in early November their numbers were the same……both states have small rural populations of less than a million. Geographically similar, similar weather…..The main variable right now is mask wear.
Guess what? I was so right. And I predict I will be even more right before Christmas.
This ongoing experiment will also give us some insight into herd immunity, and probably sooner rather than later, since South Dakota is on a course to expose everyone in the state.
SD’s Governor Noem tweeted an important message on Thanksgiving…..she wants everybody to go shopping.
I feel bad for anyone that works in a hospital in these states. Those states are going to be screwed when doctors and nurses just walk away and move elsewhere.
Ah, I missed that North Dakota had instituted a mask order. That explains a lot. Yes, North Dakota has seen a significant drop in cases in the last week. Not to low levels, mind you. Their .115 percent of the population per day infected last week was still one of the highest in the country, but it was far better than the 0.17% of the population per day the prior week, the highest in the country.
I was wondering if were seeing the impact of non-pharmaceutical interventions (mask orders, people staying home more), or if there were 6 people infected for every documented case, and thus 70% of the people of North Dakota have actually already had Covid, and it is slowing on it’s own. I guess at this point, I’ll have to go with the mask mandate.
WorldOMeter’s numbers are very close to identical. Where’s the hammer? But, yeah. Three things to look at:
The numbers thru early January (when some of the fat ladies have sung).
That the two populations behaved differently!
Deaths – i.e. a usable metric. Generally, number-of-reported-cases is dependent on too many extraneous factors to safely use as a metric.
BTW, for calibration, we’d want to see how ND and SD differed during past “flu seasons”. Hmmm. Let’s check:
Numbers from the CDC. Too bad these graphs don’t divide by population. ND pop is 760k to SD’s 880K so SD’s numbers are that much higher. But ND looks like they’ve done a bit better this year, whereas in other years the states seem about the same.
WorldOMeter’s numbers are very close to identical. Where’s the hammer?
We’re taking things that have changed in the last three weeks Felix. You have to look at the graphs…..please do, and then you won’t say that….not at all.
Just some history…
In other news, the Sun will rise in the east and set in the west.
No. I saw the sun rise in the west because I was facing south.
Signed,
GOP under Trump
»» Is this expected hypocrisy more amusing than it is pathetic or more pathetic than it is amusing? ««
More pathetic than amusing. Definitely not amusing.
In regards to the last post on TCS. People need to think why there is TCS. Lots of people bash Trump but 70 million people still voted for him. He hit a chord with many Americans and they are realizing that they are up against a stacked card deck regarding congress and realize they do not really have their best interest in mind. TCS, Brexit, Trumpsim, populism, antifa, BLM is the result of past administration throwing the main street under the bus. You have both sides (right and left) voicing their displeasure. Sometimes they do not realize it is the same thing they are fighting as both political parties are good at putting the blame on the other.
All the issues BLM protestors complain about did not suddenly happen under Trumps 3 years. Those issues where brewing for years. Travon Martin was under Obama watch. Why did he and Joe not make changes to prevent the meltdowns in 2019? One of my agreements with Trump in the debates. Joe….you have been there forever….why does it need fixed now. People always blame the president but what about those long term congress people that were there the whole time.
Who actually thinks TCS and antifi are going away now that Biden was elected. More gig jobs are not going to cut it. Free education that gets you a job driving a Uber when you graduate is not either. Lots of small midwestern cities that lost manufacturing jobs are still hurting.
I do have a suspicion if Antifa goes away, then it was probably a paid organization created for this election year. We will have to wait an see.
Antifa and BLM both are products of social media…..in the same way the Trump base is…..they just believe a different false narrative.
We live in a world where police violence against all people (including African-Americans) has gone down for 30 years (until this year)…yet a single viral video can put tens of thousands of angry people in the streets…..and we can have whole new industry emerging around teaching liberal leaning white people abut how racist they are…..
Antifa is also a product of a few generations of declining real opportunity for younger people of average motivation, intelligence and education) (which is to say the lower end)….especially young men…..who are increasingly falling by the wayside in our world….they have taken on the ideas of post-modernism…..which are deeply flawed and nihilistic….
No, none of this is going away. It’s going to get more polarized and more crazy. People will believe anything these days.
Idle hands are the devils work, thats the saying right?
When people have nothing better to do, they do bad things. This year was full of bad things.
I’m not convinced that many voted for Trump. I find it impossible he got more votes than 2016.
Your arguments are disingenuous because we dont have a dictatorship. You seem to think the executive branch can just wave a wand and change anything they wish. This proves you are likely a Trump supporter as well. The truth of the matter is Obama was blocked by a house and senate controller by Republicans for 6 years. Biden was a senator from a small state for most of his career. This means he had exactly 1/538 power of the legislative branch. Are you familiar with how the US government works ? Stop being obtuse.
My wife’s hospital just shut down all non emergent surgeries again. Forget about the Republicans. They failed us.
Um take a look at similar actions in Europe.
This virus doesnt, and never will, care about your dem vs. repub narrative.
Wearing a mask reduces viral load. Staying at home matters. Europe opened restaurants in the summer along with bars and public transportation. Europe failed in different ways.
Top pathologist Dr. Roger Hodkinson: “Masks are utterly useless.”
Italy has had a spike in cases despite mandatory mask wearing for some time.
This is the sort of thing I was talking about when I said I expect the Fed and the Treasury to work more hand-in-glove in the new administration. I think the missing piece here that ZH fails to grasp, is that there will be more helicopter money. This will be required because COVID is about to reach new heights of devastation. No way ordinary people are going to get through it without more help.
Bretton Woods 2.0 may turn out to be a nothingburger or it may it up being the wakeup call for Washington RE deficits, we’ll see
How Trump is laying the groundwork for violence and unrest during Biden’s presidency link to latimes.com
Garbage take. We’ve been subjected to “Republicans destroying democracy” from the left for decades. I’m old enough to remember “Ronald Reagan’s platform lifted verbatim from the pages of Mein Kampf”. That’s part of the reason no one believes this narrative any more. At the same time, we’re supposed to ignore the violence that wracked the country all summer. Go figure.
This is exactly why I was ecstatic about the election results, which I never imagined were even possible. The best governments have been when we had a Democrat President, with Republicans having at least some control over Congress. The worst have been when either party had complete control.
When you have a split, a Republican President with a Democrat Congress doesn’t work because the Republican President always pushes for tax cuts, and agrees to spending programs to get it, which is the worst of all possible worlds. When you have a Democrat President and a Republican Congress, the Republicans magically turn become fiscally prudent, and the Democrats don’t want to be blamed for massive deficits for fear of even more Republican gains in Congress.
I’m looking forward to the next four years with optimism that we will see practical compromises, and nothing extreme being done, and gradual improvement on the deficit front.
Similar sentiment.
But the results aren’t final. No I don’t have TCS, I’m talking about the Georgia Senate run-offs.
GOP needs to lock down at least one of those seats or we’re in for some whoppers… huge amnesty, huge student debt forgiveness, the largest version of the HEROES Act which includes direct $1200 payments to non-US citizens. I wouldn’t even write off the possibility of “reparations.”
The difference will be night and day… McConnell’s best game is obstruction and he knows how to keep Party discipline when the votes matter most. If Schumer is running the Senate, 2021 and 2022 are going to be wild rides. I don’t expect the Dems to piss away the opportunity like Trump did in 2017 & 2018. And I’m still smarting from 2009 & 2010 bringing us the ACA.
ROFLOL. There is a reason why people voted for Trump. When the Rs lose the Senate all those with TDS are going to be crying some major tears (especially Mish).
There is no way the Ds let those Senate seats go R. Anyone who think that Ds play fair haven’t been paying attention the last 4 years. They will do ANYTHING to obtain power.
Of course those with TDS think that it’s Trump who will do anything . . .lol they have no clue.
Totally agree
Its called can kicking. At some point that will nor work anymore and you will need a democratic administration and democratic control of the house and senate to fix the problem because the republicans only care about enriching themselves which is not good for the country in the long run or in this case after the last kick of the can
One of the many reasons I finally changed my registration four years ago. The entire elephant party are a bunch of hypocrits and have provent to be so time and time again on many issues, not just deficits.
I’m not changing my registration. I’m going to start going to caucuses and raise hell.
More people need to actually go to their elected leader and voice their opinion. How many people on here actually write or email their congressman / congresswoman
I’ve always known I hated the GOP.
What I didn’t realize until the last 4 years is how much I hate the Dems and media too.
I’m reduced to throw-away votes.
The GOP is a problem because of Electoral College. If we changed our electoral system to popular vote wins, both parties would be forced to cater to the largest audience, instead of going after narrow EC wins.
To say the national deficit is out of control may be an understatement. Our surging deficit is a sign of “spending has gone wild.” It appears everyone in Washington has come together and simply agreed on, “I will support your spending if you support mine!”
While both the Republicans and the Democrats mumble about being dissatisfied over the deficit, pork packed bills continued to be signed into law. Calling these spending packages “bipartisan” helps spread the blame around and masks just how dysfunctional Washington has become. More on the ballooning national debt in the article below. link to brucewilds.blogspot.com
Mish, Democrats will win the Senate. But it’s funny to see how suddenly they care about deficit. 😂 This is a big joke. Now we see why nothing gets done to change the deficit. Interest rate will stay at zero.
I serve on a board. Before we sign on we insist on adequate D&O coverage . We are also reminded of the business judgement rule. Who would serve on a board or run for office if there was real possibility of personal liability. I believe pardoning Nixon was the right call and I don’t think Biden should use his office and spend four years going after Trump. That said there are many questions of what happened these past four years and a lot of opacity. We can’t fix it if we don’t know what happened. We do need the right kind of investigation so that even if we don’t prosecute Trump and his administration we put ourselves in a position to fix the system. Now even if Biden’s government doesn’t prosecute Trump there are investigations at the Manhattan D.A. and NY A.G. that can and should continue. I also think Biden has it right, he should not weaponize the DOJ to go after Trump but if something is uncovered, legitimately and the A.G. makes a call that’s fine. There was also pressure on the Obama administration to go after Trump. Panetta stepped in. Ultimately there were no prosecutions. That was the right call too.
After every presidency people start to talk write books etc. even without investigations the public will get a good idea of what was going on. By that time the media will have moved on and instead of a learning moment. Know one will care. I wish there was a media sight that would link all these interrelated stories together over the years.
I don’t think J’Biden should waste mental effort nor political capital with any prosecution of Fat Donnie from Queens.
But, I do look forward to the future Governor of New York, Letitia James, making her bones with Donnie Fatso spending some quality time in Ossining, NY.
It’s probably counter-productive to indict Trump in federal court, when nearly half the country thinks he walks on water.
I say that knowing he broke laws around emoluments…Absolutely no question about that, and a fairly easy case to prove, I would think.
But yes, let NY go after him….I have no idea of the outcome of that…..although it’s clear he cut every corner that could be cut….all along the way…..for decades.
The important thing is to make it hard for him to become a permanent, successful campaigner…..which might be difficult no matter what the outcome of his legal issues. We don’t need a permanent Trump party.
This was telegraphed weeks ago. Republicans want to make sure the economy stays weak and blame Biden. This is also why Shelton was being nominated for the Fed and why Manuchin demanded the Fed return Fed loan Funds. What ever you think about the programs , nominees and fiscal conservatism its enough to even make a cynic cringe. It’s total b.s. Four years of Trump and Republican control showed that there is no Republican platform. It’s just a power grab.
If Republicans were really serious about deficits they would pass budget cuts instead of tax cuts. Tax cuts increase the deficit (no they haven’t paid for themselves). I know that most people reading this blog are conservative leaning but at least Democrats are willing to tax to pay for their spending which is more fiscally responsible than cutting taxes to NOT pay for your spending.
Actually deficit spending to counteract cyclical declines does work but of course you need to have surpluses in the good years to pay for the deficits in the bad years. The US is not a growth engine anymore so we need to scale our sights back. There are many unproductive uses of the tax dollar both on the defense and social program sides and we need to get start acting like a country that is barely scraping by instead of one that has unlimited earnings saved for the future.
The Austrian School of Economics clearly shows deficit spending DOES NOT WORK because the future is guaranteed to have interest payments, which reduce discretionary spending needed to grow an economy. Secondly, there is no guarantee people will want to spend the same amount or more in the future. Lastly, people have a somewhat finite capacity to produce goods and services, so an economy just can’t grow forever. It is only by fiat currency and debt that an economy can grow when producers are at capacity.
The guarantee is that people will always want to spend more, but never want to pay.
LOL. Good points. Neither now how to balance a budget.
Both parties have problems with spending.
I would add, the Dems will tax but at the same time the add more and more entitlements.
I have a cousin who just retired from teaching in Illinois and is
taking home a $95k pension that will also have COLA. Just a special ed teacher and not an administrator. I am not saying she does not deserve it but that seems pretty generous. But this goes to my point of spending other peoples money. When you have the Fox looking over the chicken coop, where are the checks and balances. Lets just give everyone a raise and increase taxes.
You are certainly right that budget cuts are the answer. Over the last 70 years we have had many, many administrations, and many different tax codes, and maximum tax rates as high as 90%, and different treatments of deductions, etc, along the way. Remarkably, regardless of whether Democrats passed the tax plan or Republicans, and regardless of the maximum tax rate, the receipts are almost always exactly the same, 18% of GDP. Thus, one could conclude that, while the tax cuts didn’t pay for themselves, neither did they cost anything.
There are a few years, such as after 2000, when receipts fell below that, as people were carrying back tax losses, and a few years where it was above that. Really, though, if tax receipts are always going to run about 18%, and spending is running 25%, one has to ask, do we have a taxing problem or a spending problem, and the answer is obvious. If you want to see the deficit as a percentage of GDP fall, spending needs to drop.
Hubert Barack Hoover Obama was one of the biggest deficit fetishists in history. Always SO amusing to see folks say Dems are big spender. There are not. They are champions of that neo liberal agenda of austerity *except for wars the rich Wall Street bailouts rich gigantic corporations the military tax cuts for the rich or anything that does not benefit working folk
Basic economic logic says government should act in a counter-cyclical manner vis-a-vie the economy. The Orange Man ran massive deficits during “the greatest economy ever”, going completely against any kind of macroeconomic sense.
America Needs to Prosecute Its Presidents link to foreignpolicy.com
Ok, so why not prosecute Obama and Bush? Obama assassinated America children, and both slaughtered millions of brown folk civilians.
A question that ought to be posed to all children in public high school civics class:
“Who is responsible for the murder of more civilians:
A). Adolph Hitler.
B). GWB, Barack Obama, Hillary Clinton combined.
Discuss and give reasons for your opinion.”
It was the right call when Ford pardoned Nixon. It was also the right call when Obama decided not to go after Bush and those in his administration. I believe Biden has it right when he said he won’t get involved and wont weaponized the DOJ to go after Trump and his team. There will be prosecutions from the Manhattan D.A.. and the NY A.G. as their should.
That said, we don’t know what happened during Trump’s four years. We can’t fix it if we don’t know what happened so there needs to be a review of the facts of various decisions. Now if something so egregious gets uncovered that’s a decision for the new A.G. not Biden. But calls to simply go after Trump are wrong. And I’m saying that as someone who despises Trump. Trump will be busy defending himself for the next four years even if Biden stays quiet. That much is sure.
I agree. Pardoning Nixon was absolutely the right call. He knew he had done wrong, and he agreed to disappear and never be heard from again, and he abided by that; I never recall hearing from Nixon again, and he essentially vanished from the news until the day of his death. His pardon allowed the country to put him behind us, and to heal. For a long time after Nixon, politics was dramatically changed, and we saw good, decent people from both parties as the nominee. Can you imagine two nicer men running for President than Carter and Ford?
I don’t see the same situation at all with Trump. He does not seem to believe that anything he has done is wrong. He, by his very nature, will never agree to vanish. He lives for the spotlight. Therefore, pardoning him would have the exact opposite effect that it had with Nixon. Rather than allowing the nation to heal, a pardoned Trump would continue to tear it apart.
I serve on a board. Before we sign on we insist on adequate D&O coverage . We are also reminded of the business judgement rule. Who would serve on a board or run for office if there was real possibility of personal liability. I believe pardoning Nixon was the right call and I don’t think Biden should use his office and spend four years going after Trump. That said there are many questions of what happened these past four years and a lot of opacity. We can’t fix it if we don’t know what happened. We do need the right kind of investigation so that even if we don’t prosecute Trump and his administration we put ourselves in a position to fix the system. Now even if Biden’s government doesn’t prosecute Trump there are investigations at the Manhattan D.A. and NY A.G. that can and should continue. I also think Biden has it right, he should not weaponize the DOJ to go after Trump but if something is uncovered, legitimately and the A.G. makes a call that’s fine. There was also pressure on the Obama administration to go after Trump. Panetta stepped in. Ultimately there were no prosecutions. That was the right call too.
In general this is the road to banana republic, because sitting leaders cannot transfer power without risk. The best solution to many country’s woes is to give the guy free passage to another country. Might not be just, but saves a lot of lives. People resort to getting rid of their opponents if they have to live in jeopardy.
Better to reign in the executive with laws, but then Congress needs to be a lot more effective instead of deferring to the executive so much.