Tag Archives: budgets

The Flim-Flam Party

David Leonhardt had an interesting column on fiscal responsibility recently in the  New York Times.

“Fiscal responsibility” is one of those terms the applicability of which depends upon its definition. (I define “fiscally responsible’ as paying as you go, so putting a new government program or a war on the national credit card in order to keep current tax rates low wouldn’t qualify.) Conventional wisdom is that Republican administrations have been more fiscally-responsible than Democratic ones. Leonhardt questions–and debunks–that belief.

By now, nobody should be surprised when the Republican Party violates its claims of fiscal rectitude. Increasing the deficit — through big tax cuts, mostly for the rich — has been the defining feature of the party’s economic policy for decades. When Paul Ryan and other Republicans call themselves fiscal conservatives, they’re basically doing a version of the old Marx Brothers bit: “Who ya gonna believe, me or your own eyes?”

Ever so slowly, conventional wisdom has started to recognize this reality. After Ryan’s retirement announcement last week, only a few headlines called him a deficit hawk. People are catching on to the con.

But there is still a major way that the conventional wisdom is wrong: It doesn’t give the Democratic Party enough credit for its actual fiscal conservatism.

Aided by charts illustrating his thesis, Leonhardt points out that, at least for the last several decades, Democratic administrations have reduced the deficit, while Republican administrations have grown them. Democrats have done that by raising taxes, by cutting military spending and by reducing corporate welfare.

Some of them have even tried to hold down the cost of cherished social programs. Obamacare, for example, included enough cost controls and tax increases that it’s cut the deficit on net….Get this: Since 1977, the three presidential administrations that have overseen the deficit increases are the three Republican ones. President Trump’s tax cut is virtually assured to make him the fourth of four. And the three administrations that have overseen deficit reductions are the three Democratic ones, including a small decline under Barack Obama. If you want to know whether a post-1976 president increased or reduced the deficit, the only thing you need to know is his party.

So why is it that the “conventional wisdom” does not reflect this reality? Leonhardt faults  journalists’ devotion to the idea of “balance,” and their ingrained belief in (false) equivalence. There is a hard-to-dislodge conviction that–whatever the misbehavior–both parties must be equally guilty.

I’ve spent 25 years as a journalist and have repeatedly seen the discomfort that journalists feel about proclaiming one political party to be more successful than the other on virtually any substantive issue. We journalists are much more comfortable holding up the imperfections of each and casting ourselves as the sophisticated skeptic.

As he concludes,

The caveat, of course, is that presidents must work with Congress. Some of the most important deficit-reduction packages have been bipartisan. The elder George Bush, in particular, deserves credit for his courage to raise taxes. Some of the biggest deficit-ballooning laws, like George W. Bush’s Medicare expansion, have also been bipartisan. In fact, the Democrats’ biggest recent deficit sins have come when they are in the minority, and have enough power only to make an already expensive Republican bill more so. The budget Trump signed last month is the latest example.

So it would certainly be false to claim that Democrats are perfect fiscal stewards and that Republicans are all profligates. Yet it’s just as false to claim that the parties aren’t fundamentally different. One party has now spent almost 40 years cutting taxes and expanding government programs without paying for them. The other party has raised taxes and usually been careful to pay for its new programs.

It’s a fascinating story — all the more so because it does not fit preconceptions. I understand why the story makes many people uncomfortable. It makes me a little uncomfortable. But it’s the truth.

Truth, of course, hasn’t been faring so well in our post-fact, “fake news” world….

 

 

Did Not! Did So!

Ah, budget battles.

This morning’s Star detailed the back and forth political arguments about whether the Ballard Administration actually made the budget cuts the mayor promised during his campaign. Their independent analysis amounted to: who knows? That’s not a criticism of the reporters–it’s a reflection of the games public managers play.

This actually began back during the Goldsmith Administration. In fact, it could argued that the City’s dicey finances actually began there; I know Ballard blamed Peterson because he inherited significant budget problems, but Peterson himself inherited a true “smoke and mirrors” budget from Goldsmith. (That doesn’t mean he shouldn’t have done more to fix it.)

Goldsmith’s clever game was to change the way in which the budget was reported from the relatively straightforward system employed during the Hudnut Administration. When you change budget categories, it becomes virtually impossible to compare apples to apples. (He also touted savings from his own exaggerated “estimated growth” figures–as in “we project that expenditures would have reached X if we hadn’t done Y. What good managers we are!)

In this case, Ballard’s folks excluded federal and other grants and some debt service from the budget calculation, and “voila”–they saved money.

I know I’m talking crazy, but what if we focused less on the relative amounts we spend, and more on what we get for our money? What if we focused less on the tax levy (the total amount raised) and more on how fairly we assess property and set rates? What if we rewarded good management rather than providing incentives to cut corners and push higher maintenance costs to the next guy?

What a dreamer I am…..