Riding on a powerful wave of resentment with the Obama Administration’s interventionist policies, the Republicans performed exceptionally well in last month’s midterm elections. They picked up scores of House and Senate seats, several governorships and many state legislatures turned red.
After two years of obstructionism, the left, including the White House, has urged the opposition to become a more “responsible” stakeholder. As they will have a majority in the House of Representatives next year, Republicans should work with Democrats, the president said on election night, not “spend the next two years refighting the political battles of the last two.” The challenges that the country faces, he added, do not “lend themselves to simple solutions or bumper sticker slogans. Nor are the answers found in any one particular philosophy or ideology.” He shouldn’t expect Republicans to share that view.
Republican leaders know that the Tea Party insurrection launched against government overreach in the private sector, including health care, last year was not exclusively aimed at Democrats. Conservatives also blame Republicans who, especially during the Bush Administration, allowed a huge expansion in the size of government and a vast increase in public spending as a consequence. Federal spending nearly doubled between 2000 and 2008 in fact.
Under the Obama Administration the spending spree has continued with hundreds of billions in stimulus and an overhaul of health insurance that is projected to explode Medicaid costs. The Federal Governments has already to borrow more than a third of what it spends and that deficit will only grow in the years to come. But bumper sticker slogans and ideological divide are precisely what will prevent meaningful reform.
Ahead of November’s congressional elections, Republican leaders pledged to rein in spending, somehow but they have so far refrained from championing concrete austerity measures. They know that even if the self proclaimed fiscal conservatives of the Tea Party oppose bigger government they like a lot of what government does for them.
Overwhelmingly tea partiers, like all Americans, want to keep Medicare and Social Security for the elderly and oftentimes Medicaid for low income families as well. Cuts in defense spending moreover are anathema to all wings of the Republican Party yet along with entitlements, these are the Federal Government’s single largest expenditures.
Without entitlement reform and reductions in defense spending, it is nigh impossible to bring down the deficit and balance the budget, except through raising taxes—something else Republicans won’t do.
Republicans’ unwillingness to see tax rates go up was most dramatically exposed this month when they blocked all pending legislation in Congress before an extension of Bush era tax cuts would be enacted. They had a good case to make, arguing that during a time of recession, the government should provide certainty and stability before anything else. Democrats were suddenly concerned about the deficit on the other hand, pointing out that if they let the Bush tax cuts on the wealthiest of Americans expire, it would produce several hundreds of billions in revenue.
A compromise negotiated with the White House ultimately saw Republicans agreeing to an extension of unemployment benefits in return for the tax cuts—another multibillion dollar expense, at least for the next thirteen months. The fundamental unwillingness to compromise on core principle remains however.
Democrats and the White House may claim to be open to compromise but when it comes to spending cuts, they are far from pragmatic. When the chairmen of the president’s debt commission proposed to reform Social Security this month in order to ensure the system’s affordability for several more decades, including a gradual raise in the retirement age, dozens of Democratic lawmakers immediately lined up to “stand firmly against” pension cuts. The president himself has pledged to preserve Social Security “forever” while Speaker Nancy Pelosi promised to “do what is right for our seniors, who are counting on the bedrock promises of Social Security and Medicare.”
The president’s health insurance reform was conspicuously absent from the commission’s recommendations moreover and in all likelihood, Democrats will oppose any attempt to repeal the law or stall its implementation.
If Democrats remain averse to entitlement reform, Republicans cannot agree to tax hikes. Revenues may have dropped as a natural result of the recession but Republicans are right to point out that Washington has a spending problem before anything else.
Democrats have raised public spending as high as 25 percent of GDP, a level not seen since World War II. As a result of health care and financial reform, government interference in the private sector has grown substantially; a role that is only set to expand if the administration manages to advance its energy agenda. Restoring balance to the budget is not just a political cause for Republicans; it is economically imperative.