Thursday, November 05, 2015

The Future Consequences of Lying and Deception

by Neil H. Buchanan

My new Verdict column asks, "Does a President Actually Need to Know Anything?"  The question was motivated in substantial part by my October 8 Verdict column, in which I pointed out that all of the Republican presidential candidates -- not just Trump and Carson, but all of them -- have espoused views on taxes, spending, and debt/deficits that are seriously detached from reality.  Later, I wondered whether there is a defensible argument that it does not even matter whether the president knows anything.

In today's column, therefore, I attempt to answer that question.  I begin by recounting Ronald Reagan's two successful presidential campaigns as a way to set up the two competing arguments regarding presidential competence.  In 1980, when the concern was that Reagan was an unqualified buffoon, the defense was that he would be guided by good advisors.  In 1984, when the concern was that Reagan had surrounded himself with unqualified buffoons and ethical disasters, the defense was that it only mattered that Reagan was in charge.  Yes, it is fun (in a sad way) to relive that particular bout of double-think, but the larger point was to contrast the two arguments: (1) It's the president who matters, and (2) It's the advisors who matter.

I conclude, of course, that both are important.  With someone who is smart and competent in charge, things can still go wrong, but it is still better not to have an empty suit in the White House.  The more important concern, then, becomes who the advisors are.  My broad take on the Republicans is that they have terrible advisors who do nothing to rein in the worst impulses of a president (or candidate), and in some cases (most obviously the Bush II presidency) make things much worse.  For Democrats, I focused for purposes of the column on economic advisors, and I naturally faulted the choices by Obama and Clinton to listen to orthodox budget hawks (and, in the case of fateful financial decisions under Clinton, orthodox anti-regulatory economists).

The oversimplified version of this is: "Republicans -- bad presidents/candidates, terrible advisors; Democrats-- decent-to-good presidents/candidates, frequently bad advisors."

As part of my discussion of the economic policy errors of both parties, I noted that even the most budget-hawkish Republicans admit (at least implicitly) that the national debt will never go down.  (Notwithstanding popular misconceptions, of course, that is good news.)  Republicans have voted repeatedly for budget blueprints that do not foresee balanced budgets beginning until many years down the road.  These are not votes, moreover, in which a legislator reluctantly compromises and allows spending to go up.  Rather, these are votes of supposed principle, in which Republicans have voted in favor of various versions of budgets proposed by now-Speaker Paul Ryan, knowing that the point is not to enact legislation but to make public statements of priorities.  Like votes to repeal the Affordable Care Act, therefore, these are votes in which the Republicans say what they would really like to do.

Of course, even the Ryan plans never added up, because they were based on unspecified spending cuts and other budgetary magic.  The point, however, is that even in their most ambitious moments, the Republicans have voted to add trillions of dollars to the national debt.  Moreover, as I have argued elsewhere (especially in this short symposium piece), the idea that Republicans would actually run the surpluses necessary to pay down the debt is far-fetched in the extreme.  The last time the government was on track to run annual surpluses, the Republicans immediately passed the first Bush tax cut package.  Given their anti-tax fervor, it is difficult to see them resisting the temptation to see any forecast of a budget surplus as an invitation to more tax cutting.  (The current presidential candidates on the Republican side are similarly committing to significant increases in future borrowing.)

Moreover, the public conversation about deficits and debt has been carried on so dishonestly for so long (in a largely bipartisan way) that the public will quickly become confused by any attempts to try to pay down the debt.  In today's column, I mock one of the Generic Deficit Hyperventilating Committees for headlining some of their recent public relations pieces with this gem: "Deficits are down, but debt continues to rise."  The immediately reason for mockery is that this is simply stating what must be true by definition: If there are deficits, debt is rising.  So, people who publish such a headline must either believe that the overall level of debt matters (not the debt-to-GDP ratio, just dollars of debt), or they are trading on the idea that people are too confused to know the difference between deficits and debt, and that it is acceptable to get people riled up by screaming, "Debt!"

As I stated above, however, even Republicans know that debt will go up.  At best, their hope is that debt will start to fall later.  But the very people on whose gullibility Republicans (and many Democrats, through GDHC's and other groups) are preying have also been inundated with the balanced budget mantra.  John Kasich loudly proposes a Balanced Budget Amendment, not a Zero Debt Amendment.  His astroturf group promises "balanced budgets forever."  But to be as obvious as the GDHC's headline: When budgets are balanced, debt does not go down.

The rubes who are being manipulated with cries of "debt," therefore, will then be somewhat confused when they find out that balancing the budget does not result in a "Mission: Accomplished" moment but rather a call for even more spending cuts.  And the annual surpluses would have to last for decades, if the actual goal is to reduce the national debt to zero.  Faster debt reduction would result in a Greece-like downward spiral.  (Yes, that's right.  I just invoked Greece for the pro-debt side of this debate!)

The dishonesty of the anti-deficits-and-debt crowd, therefore, would lead at best to the strange situation in which people who have been fed a steady diet of fear about $18 trillion or $19 trillion in debt, while being told that the goal is to balance the budget, will then either be told that $30 trillion in debt is OK, because the budget is balanced, or that the budget does not need to be merely balanced but run in surplus for decades.  For those of us who have been told that the public could never understand the reality that government borrowing is not necessarily a bad thing, it is rather amusing to imagine what that hypothetical future political conversation would sound like.