Wednesday, April 15, 2009

What Do The Protesters Want?


I've avoided commenting on the tea-baggers up until now because these protests are just noise. However, at a certain point the noise becomes the issue and I think these "tea parties" have reached that point.

From what I can tell, these protests are focused on the Obama administration because of the government's rapidly increasing deficit, the bailouts and the proposed spending in Obama's budget. Yet, the majority of the recent deficit increase is due to cleaning up the last administration's mess: the financial industry bailouts and an economic stimulus supported by all leading economists. No leading economists have disagreed with either of those at a conceptual level.

The key point here is this, to cut spending and reduce the size of government right now would require 2 things:

  1. Cutting spending during a massive recession
  2. Cutting Medicare, Social Security and Defense or massively raising taxes

There is no expert or historical support for doing either of those things right now. To attempt #1 with knowledge that being afraid to spend money is exactly what caused and prolonged the Great Depression is insanity. To attempt #2 would require massive tax increases (again, insane during a recession) or to resolve issues that have been hanging over this country for 25+ years.

Solving Medicare, Social Security and Defense spending, the 3 largest drivers of the federal budget in his first few months in office is completely unreasonable.

But look at the tone of and initial cuts in Gate's FY10 defense budget that was released weeks after Obama's budget. I suspect as Social Security and Health care are addressed in the coming months, you will see spending adjusted accordingly as well. These things take time, the bureaucracies built around defense, health care and social security are extremely complex and can't be unwound with an edict from the President.


Post a Comment

Our Deal

The markets are crashing, thousands of people are losing their jobs and the government keeps funneling money into broken banks. This little blog will help explain why this is happening and how we fix it.

I'd like to preface this experiment with a contract between myself and my readers. My promise to you is that I will be civil, non-ideological, well researched and honest. In return, I only ask that you think.

Send questions to:

Quick Search

Recent Comments