With President Obama’s inauguration speech behind us we can now start to figure out what it all means. How will it exactly frame his administration and ultimately his legacy? To some it was seen as a call to a long overdue renewal of an FDR style government, to others it was seen as an unwelcome renewal to New Deal politics and yet to others it was seen as a call toward a different direction all together. A call for a Pragmatism.
And while it is obviously far too early in the Obama presidency to say which of these roads he will take, I think Obama himself wants to usher in a new era of this third option, the era of Pragmatism
“The question we ask today is not whether our government is too big or too small, but whether it works, whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified. Where the answer is yes, we intend to move forward. Where the answer is no, programs will end.”
So if a policy works then the discussion is over. We as good pragmatists would all agree that X policy is always the right thing to do and to deviate from it would be to act as an ideologue at worst and misguided at best.
Now, several great phsyicists over the years, bare with me for a second here, have sought something they call the “Grand Unifying Theory of Physics.” This theory should it be discovered or in fact exist will somehow make sense of EVERYTHING…physically speaking. The political pragmatists, and seemingly our new president, would say that certain policies are simply not open for discussion because they work and hence they should be included in something like a “Grand Unifying Theory of Politics.”
I’m all for pragmatism so if we’re going to be pragmatic and move toward a grand experiment of keeping the programs that work and ending those that don’t let me offer the first law of the Grand Unifying Theory of Politics: tax cuts stimulate the economy.
Moreover, they don’t and didn’t’ get us into the current financial crisis, period. Giant federal budget deficits didn’t either.
These things contribute to the U.S. financial system but they are not it’s central feature. We’re dealing with a credit crisis, brought on in large part by a major correction in the housing market coupled with a huge number of foreclosures and banks owning a massive amount of bad loans and otherwise rotten assets. The Bush tax cuts had nothing to do with it. How could they? If the tax cuts were putting more money into individuals’ pockets it would stand to reason they would have an easier time with their mortgages. If loans were being made to people who would not have qualified for them just a few years ago, now that would contribute to the crisis.
Moreover, the historical record, the great tape measure of all pragmatists, has clearly shown that each one of the income tax cuts we have had, and there’s been at least four, since the inception of the income tax amendment has lead to an increase of federal revenue. Just last year the federal government had record revenue from tax receipts. A record that was somehow set under the burden of the Bush tax cuts and yet the federal government had never had so much money. Why then did President Obama refuse more tax cuts in the stimulus package? Why isn’t he promising to make Bush’s tax cuts permanent? They’ve objectively increased funds to the U.S. government. They work.
And why is Bob Herbert in the New York Times saying the Bush tax cuts got us into our financial mess? If there is record revenue and enourmous deficits where’s the problem? Spending! This is so simple we should all pragmatically agree: it’s the spending, stupid.
Perhaps that should be the second law of the Grand Unifying Theory of Politics.
