Saturday, April 9, 2011

No Apology: Solving the Deficit

There are basically four tools to solving the deficit crisis in America.

1. Raise taxes
2. Reform (aka, cut) entitlement spending
3. Cut defense spending
4. Economic recovery

So which tools would Romney use?

Definitely not 1 or 3. Romney cites defense spending as a percentage of the GDP, which gives him an opportunity to claim that defense spending is actually lower than the defense spending of Russia and China. He is technically right (if you compare it like that).

Romney also makes it clear that "lower taxes and a simpler tax code will help families and create jobs." So he rules out number one, but in an effort to use number four. Romney devotes an entire chapter to how he would reform entitlement spending. I have been satisfied. I think we can safely say that Romney would use the second tool. I am also convinced that Romney does have the right formula to lead an economic recovery. However, all presidents want a healthy economy. It is not always that easy (see Obama, Barack).

So here are a couple of things to ponder:

1. There are always political restraints. The talk radio crazies who have demanded that John Boehner cut $61 billion from the 2011 budget sadly avoid the reality of there being an opposing political party in the mix. They would prefer to run off the cliff. How flexible can Romney be on the taxes and defense issues? I would rather see Mitt slightly raise some taxes and slightly decrease defense spending, in order to get concessions on the other side regarding entitlements. Our national debt is too big to remain slaves to the "no compromise" morons.

2. Can an economic recovery and entitlement reform alone cure the deficit problem? I am not sure. Again, we may need some flexibility.

15 comments:

Right Wingnut said...

- Pablo

"Crazy" John Boehner promised $100 billion.

Boehner at CPAC:

"The American people have directed us to cut spending. We will. And there’s no limit to the amount we’re willing to cut to help get our economy moving again. Let me be very clear about this: we are going to exceed our Pledge to America. We are going to cut $100 billion in discretionary spending next week. Write it down. $100 billion in discretionary spending. And we aren’t going to stop there."

http://www.speaker.gov/blog/?postid=224631

Pablo said...

Yes, that was a stupid comment intended to make the tea party folks happy. It was unrealistic from day one.

Pablo said...

And it is hilarious that he had no shame in saying discretionary spending. What about mandatory spending?

Right Wingnut said...

Pablo,

If they can't get 100 billion, how in the hell are they going to get 6 Trillion...especially since Boehner just told the American people that he would never allow a shut-down. This is going nowhere.

Anonymous said...

Pablo, It seems to me that between Ryan, and a Romney presidency, we can get where we need to be.

Romney is criticized for closing tax loopholes in Mass to balance the budget, but Ryan calls for the same thing in his plan--which as you know is receiving wide support.

-Martha

DanL said...

Romney is dead wrong with defense. It must be cut and not tied to 4% of GDP. This is probably my biggest problem with Romny and I have a really hard time swallowing this particular horse pill. Any time a republican panders to the defcons by claiming that we can't cut the defense budget, red flags go up about the resolve of that person to actually address real spending cuts and follow through. Frankly, his unwillingness to address defense spending really, really makes me believe that he will cave on any meaningful budget/deficit reforms if elected president.

OhioJOE said...

"Pablo, It seems to me that between Ryan, and a Romney presidency, we can get where we need to be." The second half of that statement is hilarious. If we cannot even win a budget battle, how in your right mind do you expect us to trust Mr. Romney to do the right thing.

Pablo, it is funny that you call talk radio crazy. Unlike you, they had the balls to shut the government down. People like you and Mr. Huckabee just want to go along for the sake of getting along. Because the GOP caved like a bunch of cowards and sissies, the Democrats are laughing their heads off because they play the GOP like a fiddle and won. Thanks a lot guys for the damage you caused. And now you think the Dems will co-operate on cutting Entitlements? Good freaking luck on that!

Anonymous said...

OJ I dont agree on much with you, but you got a point there that I agree with.

Pablo said...

OJ,

It's the exact opposite of what you just said. Boehner just succeeded in getting a gigantic cut to discretionary spending. It will not get us closer to cutting into the deficit, but it is symbolic. Now, it is time to have a real discussion about entitlements. Had Boehner shut down the government, there would have been very little opportunity to work with Democrats on the long term debt.

In case you didn't realize, there are two political parties in power, not one. The Republicans cannot just snap their fingers and pass laws. They must work with the Democrats. And shutting down the government over social policy and petty cash would have insured that Democrats have the upper hand in the real discussion coming up.

Pablo said...

Dan,

It doesn't leave him much wiggle room. He is banking on entitlement reform and an economic recovery. I am not sure if that is enough.

I do believe though that Romney would be willing to negotiate. He is not a firebrand. His time in MA showed that. I imagine that he would work with Democrats to lower the deficit, even if that meant raising some taxes and cutting defense spending some.

DanL said...

Pablo, yes Mitt is willing to negotiate with the left. But that is concerning to me. I am pragmatic myself, but I just don't trust Romney all that much to do the conservative thing. If he starts negotiating with dems, I can much more easily see him passing Medicare part E, F, and G than I can see him reducing Medicare or SS.

Pablo said...

I don't think that Mitt would pass anything that makes Medicare or SS worse. He may not pass anything, but after reading his book, I am convinced that he is very, very aware of the problem.

I am not sure about Defense. Mitt is against decreasing spending, but I am not sure if it is campaign talk or what he really believes.

The bottom line is that we have to roll the dice on somebody.

OhioJOE said...

"And shutting down the government over social policy and petty cash would have insured that Democrats have the upper hand in the real discussion coming up." The exact opposite is true, they would know we mean business, now they know we are too weak to stand for anything. We have lost the upper hand because of our cowardliness. The party swell should be ashamed for cutting us at the knees, not to mention other parts. This is a disgusting disgraceful day in our history.

So FiCons wrap themselves in the flag because they have no clothes underneath. When push comes to shove they are not fiscally responsible. They let the Dems have way. Government money for PP and NPR? Are you freaking real. That is the definition of craziness in a nutshell. And then you wonder why trust in is still lost.

DanL said...

Pablo, you're right. We do have to gamble on a candidate. I sure hope that Daniels runs as I feel that he is a much more sure thing on cutting spending than Romney.

BOSMAN said...

Romney has a history of solving problems.

I'm positive he will look at this deficit and over spending as major priorities for him and his administration and will do everything possible to leave his 2 terms with a surplus.

HE'S PRACTICED what he preaches!