Barack Obama won office by promising middle-class tax cuts, but spends money like no one since FDR and LBJ. At some point, those two actions become mutually exclusive. Fred Hiatt at the Washington Post concludes that Obama is doing a reverse Ronald Reagan, building an ironclad excuse for massive, across-the-board tax hikes in much the same way Reagan thought he had trapped government into spending less:
Since the Reagan era, some conservatives have hoped to shrink government by “starving the beast.” Refuse to raise taxes, they figured, and eventually spending would have to fall.
It’s beginning to look as though the new team may have a similar strategy, in reverse: Increase spending, and eventually taxes will have to be raised. …
The bottom line is this: You cannot run a progressive government of the kind Obama favors by collecting only 18 percent of the gross domestic product in taxes, which has been the norm over the past 40 years. Nor can you increase the tax take to 24.5 percent of GDP — which is what Obama proposes to be spending in 2019 — simply by making the rich pay more.
But rather than level with the American people about this, or lay out a plan to raise the needed taxes, the Obama administration and the Democratic Congress are putting the spending pieces of progressive government in place and apparently counting on the tax piece to fall into place later.
It depends on the definition of “rich,” which first became an issue during the Obama campaign. They floated out a series of numbers — $150K, $200K, and once even $75K — before settling on the more viable $250,000 cutoff. The White House can simply start defining “rich” downwards again, which may not be completely unsupportable in this economy anyway.
Regardless, though, Hiatt argues exactly what I’ve been writing for the last several months. Obama first wants to create massive spending programs, including new entitlements, and then deliver the pricetag once they’re in place. Obama understands that government programs don’t easily get canceled once they start delivering benefits to people; Europe could spend years describing their own problems in dismantling the nanny-states they created. By the time the middle class discovers they’ve been hoodwinked, the bill will already be due, and Obama & Co won’t allow a dine-and-dash.
Reagan tried cutting taxes to force government reform. Obama will massively expand government in order to impose broad tax increases across the nation. In the end, Obama will probably have less success than Reagan, as the American taxpayers will toss Obama and his Democrats out of office — but that will leave the problems to the Republicans, who will then have to deal with the media highlighting anecotal sob stories of people in the programs needing to get cut and accusing the fiscally responsible of heartlessness. Had the media done their jobs and explained this two years ago, or even one year ago, we wouldn’t be in that position, and right now, that looks like a best-case scenario.