El Guapo wrote:That's silly. (a) we're trusting politicans to reduce spending regardless of whether or not we raise taxes. We're currently spending more than we take in, and as part of any deal they're going to cut spending.
Heh, speak for yourself. Even Paul Ryan's budget, bursting at the seams with draconian cuts, entailed
borrowing trillions more over the next decade, and causing debt to rise by nearly $9 trillion in 10 years. Folks in Greece likely trusted their politicians to rein in their spending, yet
they continue going from financial bankruptcy to political bankruptcy:
The Beeb wrote:A lame attempt by Prime Minister Papandreou to form a government of "national unity" or "national salvation" was met with unsustainable demands from the leader of the opposition, Antonis Samaras, and was undermined by lack of support within his own ruling party, Pasok.
Papandreou proceeded to a largely cosmetic cabinet reshuffle, strengthening the position of his internal party rivals by giving them key ministerial portfolios, including the Ministry of Finance.
The "short-termism" of these political manoeuvrings has laid bare the shallowness of the political system.
What has become the biggest political crisis in Greece in the last 30 years is treated as yet another round in a normal electoral cycle - with political opponents within the ruling party, and across party divides, lining themselves up for a crack at the prime minister's office.
Of course, American politicans would
surely not follow suit.
El Guapo wrote:In this context, why would taking in more revenue via taxes as part of a deal that reduces spending make it less likely for them to reduce spending?
Firstly, because politicians routinely spin, exaggerate, obfusticate and lie their arses off. Secondly, because, as the study pointed out, history would seem to indicate that trusting venal pols to change their profligate ways by providing them with more money is akin to trusting an alcoholic to become sober by providing them with more Grey Goose.
El Guapo wrote:(b) The budget deals of 1990 and 1994 raised taxes and reduced spending, and sharply reduced the deficits (up until the Bush tax cuts and wars).
From the
earlier article:
After the 1990 and 1993 tax increases, federal spending continued to rise. The 1990 tax increase deal was enacted specifically to avoid automatic spending sequestrations that would have been required under the then-prevailing Gramm-Rudman budget rules.
El Guapo wrote:(c) The reference to giving them a "higher credit limit" (I'm assuming that this is a reference to the debt ceiling) is a canard. Every budget on the table, democratic or GOP, requires raising the debt ceiling. There is no feasible budget on the table that does not require giving a higher credit limit.
Indeed,
Greece is facing ever harsher austerity measures (or defaulting on its debt) for much the same reason. Why have a ceiling at all when it can be raised at will? I suppose the real debt ceiling will ultimately boil down to how much foreigners are willing to lend the U.S. before they decide T-bonds are no longer a worthy investment. Which amounts to the fiscal equivalent of Russian roulette, and does little to bolster confidence in American politicians behaving any more responsibly than their Greek counterparts.