Monday, January 15, 2007

The Peoples' Champion?: Part III

Now, this is more like it.

In an interview with George Stephanopoulos of ABC's "This Week," John talks about putting investment in people ahead of reducing the budget deficit.

It was always George Bush's plan to lumber succeeding administrations with an unwieldy deficit, in the hope that other politicians - and preferably Democrats - would then reduce federal social programs, in order to appease calls by the middle class to alleviate their tax burden.

On the face of it, John seems to have taken a bold stance, that sweeps away Bush's cynical ploy. And it may even put him at odds with fellow Democrats in charge of Congressional spending committees.

John is not suggesting an expansion of the deficit. Rather, that plans for its reduction should be put on hold.

The money that would have been used for deficit reduction is invested instead in housing, healthcare and targeted tax cuts, to help bring people above the poverty line.

Leaving aside the moral benefit to the nation of restoring dignity to millions of our neighbors and friends, this approach would help to make for a more productive economy, by enlarging both the labor force and the internal market.

Any corporation knows that you have to invest to grow. You don't confuse operational spending with capital investment.

Reducing the deficit in operational spending should remain a medium-term fiscal goal. But not at the expense of the economic and moral necessity of eliminating poverty in this country.

So, bully for you, John. Unless...this is just more campaign rhetoric.

You see, what John said during the ABC interview bears a striking resemblance to the language used by Tony Blair to defeat the British Conservative Party in 1997.

The political situation in Britain then was much the same as it is in the US now. The British people had been brainwashed for 18 years into believing that their economic health depended on continuing tax cuts.

Tony realized that he could only overcome the public's fear of more Labour "tax-and-spend" policies with a firm, immutable commitment by him not to increase taxes by so much as a penny.

However, Tony knew that money needed to be spent on modernizing the country's infrastructure, on re-training its workforce and on public services, to help those who could not help themselves.

So, he came up with this language about "Investing in People." He advanced the then novel notion that a government could run its finances like a corporation, and separate this capital investment from its operational spending. And thus not appear to be increasing either spending or taxes.

In large part, and to their cost, the British electorate discovered that Tony's words were so much empty rhetoric. And it is for this reason, much more than his tragic support for the War on Iraq, that Tony is now on the way out.

So, John. Are you playing the same game? Is this just rhetoric, or is it for real?

1 comment:

American Nationalist said...

I've never really understood the problem with our national debt or running a deficit.

It's mostly owed to Americans. And most of them are small-time folks -- grandma's savings bonds she gives out at Christmas.

Now, I could understand if most of the debt were owed to foreigners, but that's just not the case. It almost all stays in the US.