I’ll Be Another George Bush, If That’s What You Want
I endorse pretty much everything in this David Frum hit on Romney’s Detroit economic speech.
When George W. Bush ran against Al Gore, his economic program was centered on poorly-conceived tax cuts. But at least you could argue (a) that we had a huge budget surplus, so the proper debate to have was over what to do with the money – pay down debt, reduce taxes, or increase spending – and (b) the previous President had increased marginal tax rates on ordinary income (though Clinton cut capital gains tax rates), so you’d expect a Republican to advocate swinging the pendulum back the other way. The real scandal of the Bush years, fiscally, isn’t that he cut taxes so much in 2001; it’s that he never reversed course (as Reagan did) in subsequent years once it became clear how big a fiscal hole we were in, and that he materially increased the long-term structural deficit with Medicare Part D.
And today’s context is just wildly different from the context of the 2000 primaries. Barack Obama has cut taxes in a Keynesian attempt to stimulate the economy; he hasn’t raised them. And we have a massive budget deficit due in part to the weak economic recovery, in part to structural factors related to entitlements, but substantially because effective tax rates are so much lower than their historic norms.
You want an alternative to “raise marginal tax rates” as a way of closing the gap? Here it is. Sounds like the sort of thing Romney might have considered interesting before he realized he still had to win the nomination. But if he does win the nomination on the back of speeches like the one he gave in Detroit, that fact will determine the platform he will be permitted to run on, and the kind of Presidency he will have should he win. That is to say: one ideologically committed to poor governance.