In an attempt to emulate the electoral success they enjoyed in 1994, House Republicans presented their version of the 1994 Contract with America this past week. The new document tagged “A Pledge to America” details in its 48 pages the legislative agenda House Republicans will pursue if elected to a majority this fall. Among the worthwhile proposals put forth in the document are repeal of Obamacare and the immediate cancellation of all unspent stimulus funds. Beyond that, the Republican’s campaign platform lacks creativity and courage, favors special interests, and reaffirms the Republican Party’s commitment to the failed welfare/warfare state.
Of course, no Republican agenda would be complete without the standard proposals for tax cuts. If the Republicans take the House they promise to renew the Bush tax cuts and give small business owners “a tax deduction equal to 20 percent of their business income.” Now, tax breaks are always a good thing because the private sector can allocate money way more effectively than government, but the Republicans really need to branch out from their uncreative, politically popular tax cut proposals if they are really serious about turning the country around. What good is more money in your pocket if the cost of things continues to rise? How about proposing a new monetary system to replace the Federal Reserve’s? How about proposing one that serves all the people not just the banks? Maybe we could get one that puts real restraints on the spendthrift tendencies of politicians? You know, one that provides a sound currency, backed up by a scarce commodity, which would ensure real price stability not the type the Fed provides now where prices increase over time to benefit corporate America. But, House Republicans dare not propose that because their benefactors on Wall Street would get upset and they themselves would be negatively affected because they wouldn’t have the Federal Reserve around to monetize all their deficit spending.
Next up, House Republicans are pledging to alleviate the burdens of federal regulations on business. The idea is if regulations are light businesses will prosper, hire, and our economy will return to full health. You can’t beat that logic. But, Republicans draw a line in the sand. Under their “Pledge”, they will only require “congressional approval of any new federal regulation that has an annual cost to our economy of $100 million or more”. What is so special about $100 million? Is that the monetary threshold where regulations are most effective in protecting special interests by hindering new players from entering a market while at the same time minimizing the effect on the profits of the same special interests? It is bad enough that most federal regulations on business are unconstitutional. At the very least, Congress should approve all regulations. But if Republicans were really serious about producing a prosperous economy they would talk about repealing onerous regulations which stifle competition and only serve narrow special interests.
Their proposals to “stop out of control spending and reduce the size of government” in “A Pledge to America” are so ridiculous it is embarrassing. House Republicans want to cut government spending to “pre-stimulus, pre-bailout levels”. This, they claim, will save us $100 billion in the first year and put “us on a path to begin paying down the debt, balancing the budget, and ending the spending spree in Washington that threatens our children’s future”. Question, weren’t we on a spending spree pre-stimulus – pre-bailout? In the seven years preceding the stimulus and bailouts didn’t a Republican president and Congress increase the national debt by $5 trillion – almost doubling it? I don’t understand how a mere $100 billion is going to help us eliminate a deficit that could be $2 trillion this year? This proposal is a joke.
And in a real sign that they dig the welfare state, House Republicans are pledging to “reform” Fannie Mae and Freddie Mac. They will end the government takeover, shrink their portfolios, and establish minimum capital requirements. Again, Republicans claim their proposal will save the taxpayer money – as much as $30 billion.
However, according to the Congressional Budget Office, the government bailout of Fannie and Freddie could swell to $400 billion and if housing prices continue their downward trajectory costs could hit as much as $1 trillion. In light of these massive losses for taxpayers, Republicans must be joking when they boast their reform proposals will save a mere $30 billion. They sound like Democrats. If Republicans want to renew American prosperity they should privatizing both Fannie and Freddie, end the implicit guarantee of federal bailouts, and let the free market handled mortgages.
Lastly, under their leadership the House Republicans promise that the warfare state will be safe and secure. Well, they don’t say that exactly. They cloak their speech with emotional words in an effort to make opposing them an unpatriotic act. Instead they say, “When asked to provide our troops with the resources they need, we will do so without delay”. So, does that mean Republicans are willing to give blank checks to the military industrial complex? If it does, the Republicans will be spending all of their proposals savings and then some. More importantly, as the party of war, how many more conflicts will they get our troops into?
A Pledge to America is a wonderful reminder of why the American voters rejected the Republican Party in 2006 and 2008. Economically, all they really offer are tax breaks. In foreign affairs, they offer more war. If they are so concerned about restoring American greatness, they should be proposing: reform of the monetary system, huge cutbacks in every federal department and agency, and closing down bases and bringing the troops home to defend America. But, it seems the Republicans lack the creativity and courage to do that. They prefer instead to favor special interests and recommit to the failed welfare/warfare state.