I'm genuinely curious: from a Republican perspective ...

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03/29/2011 10:21

Subject: I'm genuinely curious: from a Republican perspective ...

Anonymous

Anonymous wrote:It's really not that hard to explain. From the Republican perspective, the government can't really do much to create jobs, on net. Yes, it can tax people and fund jobs with that money, for example, but overall that actually reduces the net number of jobs, because the taxes etc. crowd out more private economic activity than the government spending creates. It's just that you can see the direct beneficiary of the government action, but the costs are invisible and spread across the economy. The same is true for regulations. While some regulations are necessary, any regulations above what is actually necessary--and can we at least all accept that some regulations are unnecessary--has the same effect, suppressing job-creating economic activity that should otherwise happen. Hence, the best thing to do to facilitate job creation is to try to get the government out of the way.

Is this perspective correct? I imagine that is a pretty complicated question about which economists disagree, and my own guess would be that at certain levels of taxation/government spending/regulation, it is a pretty compelling argument, and at other levels of taxation/etc. it probably isn't that big an effect, and where we are on that spectrum is probably pretty hard to tell.

I appreciate that you took the time to try to explain your own personal political philosophy here.

I think, though, most liberals are thinking specifically of historical trends when it comes to using government action to spur job growth. Keynesian economics had a great run for job growth for a few decades (but did less well at maintaining that economic activity in the 70s, though is that really an indictment of Keynesian policies, or of the times -- the gas shocks and other core inflation that weren't related to economic policy per se). However, a valid criticism of the Keynesian approach is that it can't sustain economic activity, and is instead only really a good strategy to spur growth after recession/depression/war.

"Reaganomics" with its central tenant that wealth will "trickle down" is seen by many left-leaning people as starting the current trend of a shrinking middle class, and the redistribution of the tax load from the wealthy (who consume the most resources) to the middle and working classes. The left point of view for the economic success of this time period is that it was essentially a recovery from recession, and therefore even merely decent governmental economic policy would have seen a boom in economic growth (essentially, Keynesian economics).

Finally, I am more than willing to admit that the left doesn't make only great moves -- many people think Clinton ushered in a long era of economic growth, but my personal (liberal) view is that his policies set us up for multiple, poorly-regulated booms (each more disastrous than the last) and busts, that left money in the hands of very few -- redistributing wealth willy-nilly and allowing the eventual "too-big-to-fail" crises that followed (again, due to the stripped away of regulation of investing and banking during her term).

But of course, I think the piling on of the Bush-era tax cuts hurt the middle class even worse (who are seeing job losses because of the failing economy, which is directly due to the unmitigated boom growth, rather than carefully regulated, slow growth). Without those tax cuts, it would have been easier for the gov't to enact large-scale hiring for public projects (and I hope even a right-winger can appreciate that much of our country's infrastructure needs work). That would have spurred job growth (granted, public-sector) and would have reduced the unemployment and the fallout from the boom-and-bust cycles.

Anyway, I guess it comes down (to me) to whether taxes should be redistributive and progressive -- I think yes on both counts. The wealthy (and large corporations) require more gov't resources (FDIC, SEC, coast guard, military, etc) to conduct their business and make more money than the working and middle classes do. It's only fair to expect them to shoulder more of a burden. And if they choose to leave the U.S. due to higher tax rates, great -- we're a country of innovators and someone else will take their place (I'm not purely protectionist, but I'm pragmatic enough to realize this would require some sort of tariff or penalty system to allow to flourish). Finally, I think taxes were intended, partially, to prevent the establishment of a permanent aristocracy in the U.S. To allow the very wealthy to hold onto amounts of money that would fund small countries is philosophically a terrible idea (as it discourages the very innovation and meritocracy we're supposedly built on).

Last but not least, I'd love to know whether right-wingers think that America is becoming ungovernable thanks to the amounts of money that flow into the process (for all levels of elections). I think most left-leaners perceive the pay-for-votes problem to be a right-wing issue, but the truth is, wealthy interests have basically purchased both the right and left in this country. Government is becoming a charade, with lots of heat and very little light being generated by debates that ultimately were decided well in advance by donor money.