Deficit dithering is Ryan opportunity
Classic, classy conservative columnist William Safire observed early in our new century that government deficits were developing “as far as the eye can see,” as spending escalated and taxes were cut by the new administration of President George W. Bush.
The influential analyst added that the growing deficits recalled the 1980s, when President Reagan’s tax cuts and substantial defense spending boosts led mainstream leaders in business, education and other professions publicly to sound the alarm about government gone wild.
However, Safire then added that during the 1990s we were projecting federal fiscal surpluses “as far as the eye can see.” That reflected both the cumulative positive effects of powerful long-term economic growth, which began in the 1980s, and the budgetary prudence of the Clinton administration.
Safire concluded that “the eye can’t see very far.”
This bears directly on the fate of Congressman Paul Ryan’s fiscal proposals, which are long-term in nature. The Janesville Republican’s commitment to remain in the House of Representatives positions him to influence policy for years, perhaps profoundly. Economic expansion means his structural reforms could be achieved with less severe cuts.
Popular punditry projects the immediate present far into the future. However, as business people know, seeing one or two quarters out in your fiscal year can be a major challenge. When it comes to macroeconomic trends, only our hindsight is 20-20, not our foresight.
President Bill Clinton deserves credit for reducing federal debt obligations as a booming economy brought increased tax receipts. He did not ratchet up government spending, despite strong pressures.
In 1994, Republicans took control of the U.S. House of Representatives after 40 years in minority status. Their majority was led by new Speaker of the House Newt Gingrich, who dramatically confirmed the longer-term trend of shifting that office from a relatively nonpartisan post to a highly partisan pulpit.
Then, as now, White House Democrats and congressional Republicans played an escalating game of chicken, and the federal government did briefly shut down. In this case, the White House was able to put the onus for rigidity and ultimate irresponsibility squarely on the Gingrich Republicans.
Publicly cool Clinton moved ahead in the polls, and 1996 Republican presidential nominee Sen. Bob Dole never caught up. As in the 1992 primaries, Clinton earned the nickname “The Comeback Kid.”
So far, Republican House Speaker John Boehner has avoided Gingrich-style self-destruction. We don’t yet know if President Barack Obama will be another Comeback Kid.
Cerebral Bill Safire often couched his contemporary commentary in rich historical tapestry. In that spirit, consider the Eisenhower years. During and after World War II, our deficit levels were relatively higher than today, further increased by Korean War spending.
Nonetheless, President Dwight D. Eisenhower drastically cut deficits over two terms in the White House. Ike’s enormous prestige was complemented by pragmatic cooperation with Democratic and Republican leaders.
Arthur I. Cyr is Clausen Distinguished Professor at Carthage College in Kenosha and author of “After the Cold War.” Contact him at email@example.com.
Last updated: 5:55 pm Thursday, December 13, 2012