Louisiana Governor Bobby Jindal, who recently announced a plan to eliminate his state’s personal and corporate income taxes, says Republicans need to talk about growing our way out this national fiscal swamp we find ourselves in rather than cutting our way out:
“Our objective is to grow the private sector. We need to focus our efforts on ideas to grow the American economy, not the government economy. If you take nothing else away from what I say today, please understand this – We must not become the party of austerity. We must become the party of growth.”
“The Republican Party must become the party of growth, the party of a prosperous future that is based in our economic growth and opportunity that is based in every community in this great country and that is not based in Washington, DC.”
“The Democrats promise to be the party of “more from government,” but they are actually the party of less. They are the party of economic contraction, austerity and less from the economy. The Republican Party is the party of “more,” the party that creates “more from the economy.”
Jindal also says that Republicans don’t need to change their principles, but they do need to change just about everything else:
“We believe in planting the seeds of growth in the fertile soil of your economy, where you live, where you work, invest, and dream, not in the barren concrete of Washington.”
“I am not one of those who believe we should moderate, equivocate, or otherwise abandon our principles. This badly disappoints many of the liberals in the national media of course.”
“No, the Republican Party does not need to change our principles…but we might need to change just about everything else we do.”
Perhaps, from a marketing standpoint, Jindal has it right. Maybe there’s a new way to package conservatism. But I’m skeptical about this idea that we can grow our way out of our fiscal problems.
That sounds suspiciously like pandering to the political schizophrenia which got us into this mess to begin with. We have $16 trillion in debt, and a $1 trillion annual budget deficits, because Americans want more government than we’re willing to pay for.
Marco Rubio has made similar noises about growing the economy, instead of raising taxes, to increase revenues and lower deficits. It makes sense, but this isn’t a silver bullet, and we should know that given what happened during George W. Bush’s years in office.
For several years after the Bush tax cuts, from about 2003 – 2007, we had an expanding economy and rising tax revenues. The problem is that spending continued to grow, too, even under (for the most part) a Republican Congress and a Republican President:
We continued to run budget deficits under Bush because, despite a growing economy and growing tax revenues, spending continued to grow too.
Now, it sounds nice for people like Jindal and Rubio to talk about growing our way out of our fiscal problems. Because they make it sound as though we could keep all the government we have now and still address the debt/deficit problems simply by getting the economy going.
This is nonsense. That plan might lower deficits, but it won’t eliminate them. It won’t get us to a point where we might be able to start paying down the national debt. And it will do nothing about the trillions of dollars in unfunded entitlement obligations represented by Social Security and Medicare.
Jindal says Republicans can’t be the party of austerity, but he’s wrong. Republicans must be the party of austerity if they’re serious about fixing our problems.
The dilemma is that being the party of austerity probably won’t win any elections until American stop voting for more government than they’re willing to pay for.