Sunday, August 14, 2011

Bachmann sidesteps question about nation's paying its already-incurred bills when talking about massive spending cuts, after straw poll win

Today, Candy Crowley interviewed Michele Bachmann about her “straw poll” Iowa win, and got into the matter of the debt ceiling fiasco.

Bachmann claimed that, had the debt ceiling not been raised, bond holders would have been paid and seniors would have gotten their social security, and military personnel and veterans would have been paid. Maybe so.   
(I’ll sidestep right now whether Obama could and would have invoked the 14th Amendment which, apart from possible impeachment, would have made the debt ceiling matter “almost” (not quite) totally moot.)  But then she went on to say something like, “we have to cut spending”.  Does that mean stiffing people who have already put in the hours for which they must be paid?  That would include contractors and federal employees.
We’re not talking just about layoffs. We’re talking about not paying people for work already done, expenses already incurred.

Do people get the difference? 

Yes, there can be personal hardships (on individuals, extending into their families) in both kinds of circumstances.  But Bachmann is threatening the whole idea of an economy that can be trusted. Modern individualism is based on this economy, and, curiously, on a certain kind of global interdependence and trust.
In the longer run, the “Tea Party” could be right.  While I buy the idea that the short term economic malaise requires stimulus and that deficits should be cut gradually in the long term, I’ve heard this many times before.  Do we have to think about cold turkey now, to avoid a bigger debacle later, when maybe three-fourths of our GDP goes to service debt?   (People have said that about the Great Depression – that the New Deal prolonged it – and have said that about the 2008 bailouts and TARP.  But the same people have sometimes said we should get rid of the FDIC and deposit insurance, too.)

The radical Right could be “right”: future generations could be better off if we can repudiate some of our burdens, throw people off the boat, and start over. But that starts a debate on the moral aspect of the social contract that they don’t seem to want to have.  For example, should we, as one USA Today column suggested, limit the lifetime amount people can spend on Medicare, or means test (even across family) the use of life-extending procedures once a certain age is reached?  “Nobody” wants to face this.

The “debate”, if you have it, certain turns into something else: how much of the safety net should be covered by public funding, and how much of it should be part of inter and intra-filial personal responsibility?   The claims that entitlements are wrecking our economy could be overblown; runaway contractor abuse could be part of the problem.

And, does raising taxes a little on the “rich” stop the offering of jobs? Well, a family making just $250000 a year is no longer “rich” for one thing, but, maybe you could raise that number. Then you have the question, if a family that owns a few McDonalds’s franchises pays more in taxes, does it hire fewer people? Maybe so.  But if you’re the head of a Facebook or Google and pay more in taxes yourself, do you hire fewer people? Probably not.  As I look at my own future (a movie venture), I could see this playing out either way.

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