Higher taxes now spending cuts later. That was the balanced approach" President Obama and the Democrats tried to force Republicans to accept last August. While Speaker John Boehner R-Ohio wanted to make the deal House conservatives forced him to say no. They knew from President Reagans experience in the 1980s that the tax hikes would come (sure as death) but the spending cuts never would.
The exact same story has been playing out in Europe. For months weve heard liberal commentators like The New York Times Paul Krugman and Clinton Labor Secretary Robert Reich decry Europes austerity" programs. Yesterday Krugman wrote claims that slashing government spending would somehow encourage consumers and businesses to spend more have been overwhelmingly refuted by the experience of the past two years. So spending cuts in a depressed economy just make the depression deeper."
Problem is Europe has not been cutting spending. Mercatus Center Senior Fellow Veronique de Rugy has crunched the numbers and found that among some of Europes worst economies (Spain the United Kingdom France Greece and Italy) government spending cuts have wither been tiny or non-existent. Greece and Spain did cut slightly in 2009 through 2011 but both countries are still spending more today than they were in 2008. Italy did reduce spending in 2009 and 2010 but increased spending in 2011. Meanwhile France and the United Kingdom have yet to cut spending at all.
Veronique adds:
The most important point to keep in mind is that whenever cuts took place they were always overwhelmed by large counterproductive tax increases. Unfortunately that point is often overlooked. This approach to austerity some spending cuts with large tax increases is what President Obama has called the balanced approach."
Indeed The Washington Post reports that Obamas message to France in the wake of their last election has been more spending and looser monetary policy would help promote recovery in the short term and could be reined in later." Complete silence from Obama on the new French governments plans to raise taxes on the rich to 75 percent.
Obamas plan for the United States is identical to the new Socialist governments plan for France: higher spending and taxes now spending cuts later. Republicans should offer Americans a different path this November.
Higher taxes now spending cuts later. That was the balanced approach" President Obama and the Democrats tried to force Republicans to accept last August. While Speaker John Boehner R-Ohio wanted to make the deal House conservatives forced him to say no. They knew from President Reagans experience in the 1980s that the tax hikes would come (sure as death) but the spending cuts never would.
The exact same story has been playing out in Europe. For months weve heard liberal commentators like The New York Times Paul Krugman and Clinton Labor Secretary Robert Reich decry Europes austerity" programs. Yesterday Krugman wrote claims that slashing government spending would somehow encourage consumers and businesses to spend more have been overwhelmingly refuted by the experience of the past two years. So spending cuts in a depressed economy just make the depression deeper."
Problem is Europe has not been cutting spending. Mercatus Center Senior Fellow Veronique de Rugy has crunched the numbers and found that among some of Europes worst economies (Spain the United Kingdom France Greece and Italy) government spending cuts have wither been tiny or non-existent. Greece and Spain did cut slightly in 2009 through 2011 but both countries are still spending more today than they were in 2008. Italy did reduce spending in 2009 and 2010 but increased spending in 2011. Meanwhile France and the United Kingdom have yet to cut spending at all.
Veronique adds:
The most important point to keep in mind is that whenever cuts took place they were always overwhelmed by large counterproductive tax increases. Unfortunately that point is often overlooked. This approach to austerity some spending cuts with large tax increases is what President Obama has called the balanced approach."
Indeed The Washington Post reports that Obamas message to France in the wake of their last election has been more spending and looser monetary policy would help promote recovery in the short term and could be reined in later." Complete silence from Obama on the new French governments plans to raise taxes on the rich to 75 percent.
Obamas plan for the United States is identical to the new Socialist governments plan for France: higher spending and taxes now spending cuts later. Republicans should offer Americans a different path this November.
