Huffington Post

New Huffington Post Column

The Case for Republican Economic Sabotage

With a few exceptions, tea party events have always appeared less like protest rallies and more like Sunday evening lawn concerts, with attendees lounging in lawn chairs waving tiny flags -- not unlike a Lee Greenwood "unplugged" festival at the local Yickadoo Amphitheater and Flea Market. But with tea party attendance declining, the leisurely, almost bucolic atmosphere of the tea party gatherings has become increasingly lackadaisical.

Until, that is, the other day when one of the Tea Party Express performers mentioned that the Standard & Poor's credit downgrade was being blamed on the tea party wing of the Republican Party.

The crowd loved it.

Perhaps they simply didn't understand what just happened. Perhaps they tend to blurt out "yay!" every time the tea party moniker is mentioned in public, like when a rock star mentions your home town during a concert. But I tend to go with Occam's Razor on this. The simplest explanation is the most likely one: they were thrilled that our credit rating was downgraded because, in keeping with the plan, it would damage the economy and, thus, the president. So they decided to let out a spontaneous and collectively gleeful yalp.

On Monday, the market suffered its sixth largest decline ever. On Wednesday, its ninth largest decline ever. Based on simple economic principles, I fear this is only the beginning. The spending cuts demanded by the Johnny-come-lately Republican austerity obsession will create further havoc with declining GDP and rising joblessness.

Sure, the S&P screwed up their calculations by $2 trillion. But the errors made by the S&P are secondary to the bigger picture here, and that's the deliberate, systematic Republican sabotage of our economy.

As superlative as that might sound, it's not quite emphatic enough. The Republicans, inclusive of the tea party, have been orchestrating another economic decline knowing that it will damage the president's re-election chances as well as the perceived efficacy of Democratic economic policies. Put another way, the Republicans are threatening your personal well-being in order to defeat the president, and they've just completed the latest successful attack in their economically bellicose strategy.

The primary evidence exposing the sabotage is their demand for deficit and debt reduction at this point in the recovery from the Great Recession and their calculated ignorance about the impact of the president's initial stimulus plan.

Check the record. Deficit reduction in a slow growth high-unemployment economy has only ever caused the economy to recede. While, yes, the Republicans are dangerous and often feign ignorance, they're not stupid. Despite what they say, they know budget cuts will hurt economic growth in this specific climate. How do they know? History. As I wrote last week, 1937 is the best historical evidence of deficit reduction causing an economic back-slide.

What else does history show us? The bulk of the deficit is the result of Republican policies. This is an indisputable fact. Hubris and a "starve the beast" spending policy lead to record price tags for Iraq and Afghanistan, the TARP bailouts and, finally, the massive Bush tax cuts (graph). Adding the fiscal consequences of the recession to the tally and there it is: the federal budget deficit.

I only point out the Bush record to emphasize a crucial point in this sabotage argument, and we've all talked about this at some point or another so I'm not breaking any news when I repeat the observation that the Republicans only became concerned about the deficit when President Obama was inaugurated. Prior to that, I can't recall a single tea party austerity rally or floor speech demanding an end to "out of control spending." But when the president had no choice but to spend our way out of a worsening recession, the Republicans brandished their tri-corner hats and denied they had anything to do with the recession or the deficit.

But, and this is the next chunk of evidence for sabotage, their opposition to the stimulus didn't stop them from gladly accepting gigantic federal stimulus checks. Republican governors like Bobby Jindal famously posed for cameras with a ear-to-ear "go-with-a-smile" grins on their faces while proudly gripping those over-sized novelty checks. Is this indicative of a party that's fundamentally opposed to government spending, or a party that's only opposed to spending when it helps them politically?

It turns out the Republicans are totally in love with government welfare (except when the money goes to people who really need it). Texas governor Rick Perry personally received and accepted over $80,000 in federal subsidies. Perry also relied on stimulus money to balance the Texas budget. Both Michele Bachmann and Rick Santorum repeatedly attained federal money for pork barrel projects in their home states. In the words of President Bartlet, if they're so opposed to government spending "can we have it back, please?"

The biggest secret you'll never hear from the Republicans (or, sadly, the Democrats for some reason) is that the deficit has been slowly shrinking as modest growth has boosted revenues -- a reality that proves the point that stimulus, leading to increased economic prosperity, leads to more tax revenue and, therefore, deficit reduction, even when spending remains higher than normal. Fact: President Obama and the Democrats reduced the deficit by $120 billion in their first fiscal year, down from the last Bush fiscal year. By the end of the president's first term, the deficit, even without the debt ceiling deal, is projected to be $300 billion less than Bush's final deficit. The math doesn't lie. But the Republicans do -- about the president's deficit and about their own spending record.

Irrespective of the Republicans brazenly and hypocritically accepting stimulus money and federal earmarks, the stimulus absolutely worked in relation to its dollar value and the size of recession itself, which turned out to be far deeper than was known at the time. As soon as the stimulus was signed -- almost to the day -- the stock market began to steadily rise, GDP turned around and, within a few quarters, was growing again and job losses began to be erased, with fewer each month. Had the stimulus been larger, the positive effects would have obviously reflected that. But once the money began to run out and the demands for austerity began to be taken seriously, growth and job creation slowed. And this week, following the debt ceiling deal which will cut trillions from the budget, the markets tanked and a second recession has the nation on tenterhooks. The Republican sabotage plan in motion. (It's also worth mentioning here that the other "evil" source of Democratic "spending", the Affordable Care Act, actually reduces the deficit, according to the Congressional Budget Office. Yet the Republicans were screechingly opposed to it, despite the deficit reduction and its close resemblance to healthcare plans proposed by Bob Dole and passed by Mitt Romney.)

Deficit reduction is absolutely necessary. But not yet. Not when the world economy hangs in the balance. But now, with austerity dominating the legislative agenda and the common wisdom in Washington, all safety nets have been stripped away, leaving nothing between us and a protracted nightmare of worsening joblessness, poverty and despair -- oh, and another Republican president and another Republican Congress, which will likely be responsible for racking up more deficits and debt with continued tax cuts for the super rich while blaming the awfulness on the Democrats.

Maybe we should give the benefit of the doubt to the tea party picnickers who were cheering for the credit downgrade the other day. After all, they were only following the leads of Mitch McConnell, who has been repeatedly open about his sabotage plan, stating that his goal is only to defeat the president no matter what, and House Majority Leader Eric Cantor, who is quite literally betting against the American economy by shorting government bonds. The Republicans have nothing to lose and everything to gain, and the facts prove them to be culpable of orchestrating what is arguably the most heinous and destructive Republican political scandal in American history.

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  • George_Price

    (I tried to post this comment on the HuffPost page but it was too long for them.)

    Americans need to know exactly why the Tea Partiers are wrong at their very foundation. Those of us who do know have a responsibility to inform others, including the Tea Partiers themselves. Smugly dismissing them and making them the butt of jokes may be an enjoyable sport, but to do only that is a luxury we cannot afford. This is a matter of life and death—for the entire planet!!

    Where can we begin? How about with their name, “Tea Party,” and the meaning of their acronym, TEA, or “Taxed Enough Already.” This is based on a basic misunderstanding of the Boston Tea Party that perhaps most historically-challenged Americans share, even those who are moderate or left of center. The Boston Tea Party of 1773 was NOT a tax protest, or a protest against taxation without representation imposed by a tyrannical monarchy. While unjust taxation was an ongoing concern of those activists, the more immediate issue that ignited that particular event was their opposition to monopoly capitalism.

    The Boston Tea Party was a direct response to the Tea Act of 1773, an act of Parliament designed to expand the unfair trade advantage of the British East India Company by exempting this royally chartered company from having to pay export duties on their tea, thus allowing them to sell their tea at prices that undercut the competition. Prior to the Tea Act, the BEIC already enjoyed a near monopoly on the trans-Atlantic tea trade which had forced their small business competitors, such as John Hancock and many others, to become tea “smugglers” in their pursuit of “free market,” or at least fair economic competition. While it is true that being pressured into buying their tea from the BEIC also caused the colonists continued subjugation to paying the unjust tax on tea that was passed in 1767 (The Townshend Act), the repression of opportunity for common people to engage in fair competitive economic enterprise, protected from the exploitation of tyrants (in business and government) was probably the primary concern of the people who dumped BEIC tea into Boston Harbor and refused to unload it from the ships or let it rot on the docks in many other American seaports.

    The spirit of the tea protests was in harmony with the other oft-forgotten egalitarian, Enlightenment era concerns that had moved the common citizens of the colonies toward Revolution. The many references to “tyranny” in the writings of Enlightenment thinkers like Montesquieu, Rousseau, Trenchard, and Gordon, and American revolutionaries like Samuel Adams, Jefferson, and Paine were certainly not limited to the topics of taxation, property rights, and the right to bear arms, as many would have us believe. “Tyranny” often referred to oppression against what they then called “the rights of man” (or what we now refer to as “human rights”), which was a very primary concern of that era, including a widespread opposition to slavery, both in Europe and America, along with the right to have some form of democracy or representation in government for all the people of all economic classes. Certainly, all of the above were widely-debated and not all revolutionaries of that era were consistent in their egalitarianism (for example, many had no problem with race-based slavery, or the dispossession of Native American lands). But, the common people of the colonies were not only opposed to monarchy, but also to aristocracy. The history of all these popular concerns was soon sublimated and even forgotten in an early republic whose economy was built on the productions of slave labor and the dispossession of the homelands of the first indigenous Americans—an economy which rapidly expanded during the 19th century with the additional exploitation of immigrant laborers and the labor of children.

    Of course, such historical truths are probably not convenient for those who currently support unregulated monopoly or near-monopoly capitalism. The resemblance of the British East India Company to the major “too-big-to-fail” oil, pharmaceutical, retail goods, and banking companies of today is either completely lost on these Republican saboteurs and their flock of sheep, or intentionally over-looked. I’ll give you another example of how they have twisted and sabotaged history for their own purposes. The Koch brothers, founders and funders of the T.E.A. Party, previously founded and still fund the Cato Institute, a “think tank” whose very name, in twisted combination with its actual function, serves to obscure the good names and actual ideals of John Trenchard and Thomas Gordon, who, under the penname “Cato,” wrote a series of 144 essays in the early 1720s that were a key source of inspiration for the American revolutionaries. While the Cato Institute suggests that the Cato writers were supporters of laissez faire, Reaganesque, trickle-down economics, they can only do so by conveniently ignoring many egalitarian passages from Cato’s Letters such as this one:

    “As liberty can never subsist without equality, nor equality be long preserved without an agrarian law, or something like it; so when men’s riches are become immeasurably or surprisingly great, a people, who regard their own security, ought to make a strict enquiry how they come by them, and oblige them to take down their own size, for fear of terrifying the community, or mastering it. In every country, and under every government, particular men may be too rich… But some will say, is it a crime to be rich? Yes, certainly, at the public expense, or to the danger of the public.” (Cato’s Letter #35, “Of Publick Spirit,” July 1, 1721)

    Samuel Adams quoted this and many other passages from Cato in his newspaper, The Independent Advertiser, and such rhetoric is pervasive in the revolutionary literature of the day. For those interested in reading and deciding for yourself what the actual tenor of their discourse was, all 144 of Cato’s Letters, along with the works of many other inspirational Enlightenment writers are posted on the internet at and also available elsewhere.
    Unfortunately, very few of us were taught much about egalitarian Enlightenment era thought in the American school systems. Selective historical memory produces collective historical amnesia. Hopefully, it is not too late to save ourselves, our nation, and the world from the natural results of centuries of convenient omission of truths that would hinder the economic and political exploitation of the many for the benefit of the few.

    More inclusive, truthful, and inconvenient American histories have been produced within the last forty or so years, such as Gary B. Nash’s The Unknown American Revolution: The Unruly Birth of Democracy and the Struggle to Create America (2005, Penguin Books)and Jill Lepore’s, The Whites of Their Eyes: The Tea Party’s Revolution and the Battle over American History, Princeton University Press, 2010. What Nash, Lepore, and many other honest American historians have been revealing about the American Revolution is that the elite, wealthy, mostly slave-owning individuals who are most often referred to as “the Founders” were usurpers of an egalitarian people’s revolutionary movement that had been in place for decades (or more) before they co-opted it in an attempt to replace the monarchy with their own “reformed” aristocracy. More accurate historiography, combined with increased internet access to digitized archival records, has greatly increased our collective ability to correct the errors of the past. If the educational systems of our nation will not teach our true history, each individual can now find it for themselves and teach anybody who cares to know.

    • Josh Page

      A really fine post, Bob. I intend to add some of your more pithy phases to my own conversational repertoire.

  • MrDHalen

    I hope this site’s comments section doesn’t become the cesspool that is currently going on at Huffpost. If the number of right wingers commenting on neutral and progressive sites is anywhere near legit, we have a real problem in this country.

    I am meeting too many people who seem to be buying into the Republican crap; and I’m in Los Angeles. The problem isn’t just with congress; there is a big problem with the American people as well.

    Thanks Bob and JM Ashby for a job well done.

    • Lexamich

      Dan, it’s more likely that there are a handful of righties (in proportion to legitimate posters) trolling Huffpo with sock accounts. I figure they’re the “some people” from all those FNC declarations of Democrats doing fucked up things to ruin the country and rappers being invited to the WH to eat chicken. Most are probably retired from working full-time, so part of their daily routine they waste time watching television and web-browsing. Speaking of the trolls, they’re very pervasive, but one way you can spot the sockpuppet is to pay attention to their prose.

      For instance, most of these trolls like to play victim when someone tells them they read a little too much like a Republicon fraud. They’ll badger (like a Republicon, mind you) about how no one is allowed to criticize the current president because the Obamob will scold them. Meanwhile, pay attention to how many of these “individuals” are criticizing Obama within a thread they’re confronted in. If the Obama critics outnumber those defending him, do not allow the critics to play victim, but take the focus off of Obama and onto congress, SCotUS, or the media. Your goal is to judge their reaction to the other articles to criticize, not to broaden the debate and/or discussion. Be as crafty as the trolls believe themselves to be, and you’ll have them betraying themselves in no time. The Republicon trolls are not very smart – SERIOUSLY! They do now how to recite talking points and ad hominems. Ask them to go beyond that – for the sake of the “progressive agenda” and what-have-you – and they be unable to follow.

      There actually are plenty of disillusioned liberals and/or progressives that, in my humble opinion, are allowing figures within the corporate media to dictate what they aught to care about. These people are misguided and not worth arguing with. Their goal is not to settle on what is wrong with the Democratic Party or President Obama, but how wrong you are and how right they are because more than one influential figure (again, with the corporate media) says as much. Ignoring these self-indulgent people is the worst thing you could do to them, so do it with relish. It won’t hurt, and you’ll feel better than you would if you’d have argued with them about how Hillary would’ve been better and whatnot.

      Anyway, I don’t know if I’d trust the trendoids in L.A. as a proper gauge of the country’s collective mindset. The vibe I’m getting from most people I talk politics with on a personal level is that they see congress as dysfunctional and the president as the unfortunate optimist caught in the middle. They see Democrats as weak primarily because they appear willing to let Republicons confound and bully the American public.

      On a personal note, I had one conversation with a woman that told me she wasn’t worried about herself (she’s on SSD, among other things), but her children, ages 17 and 14. I told her to talk politics with her children openly if they themselves are interested, but don’t force the issue onto them just because you’re observing a non-functional government.

      Kids are smarter than we adults give them credit. They know how to pay attention, and if there’s a stable, intellectually-nurturing environment at their disposal, they know how to get through tough times. No matter what political affiliation they chose, American children are very resourceful. This is not shown on television or on social media. Not a lot is demanded of them, so they pay the things that do not matter to their immediate future any mind. Going by the opinions of the children I’ve spoken with, they feel that everyone’s a sellout and the world is made of crap – the usual growing pains.

      However, they like President Obama. They like the way he carries himself. They admire the First Lady. They don’t have much to say about Malia and Sasha, though. Most kids wouldn’t, really. Too self-centered and focused on they’re on adolescent travails. A lot of the kids I spoke with wanted former Rep. Anthony Wiener to stay, but then this is NY I’m speaking from, so they may be a bit biased.

      That is just a sample of what I’ve been exposed to regarding political discourse.

      It’ll be tough going for both parties next year, but the Democrats I speak with always understand the causes they’re voting for, as opposed to the Cons I observe that only appear interested in having fleeting theatrical victory laps over nonsense that hurts the American majority more than it helps.

      • MrDHalen

        Thanks Lex.

    • JMAshby

      I moderate obvious trolls specifically to prevent a cesspool from forming.

      • incredulous72

        Thanks Ashby.

      • MrDHalen

        Thanks Ashby.

    • dildenusa

      Huff post has a financial incentive to draw readers to its site. At the present time it has become a cesspool not only of tea party republic trolls but also of ultra left wing trolls who have branded President Obama as “Bush Lite.” Huff post has given free rein to these trolls all in the name of money. They have drowned out the voice of reason and of the political center where the majority of people support the president and understand that the tea party republic is throwing roadblocks up at every turn. But why do intelligent people on the left give the president a difficult time? The president has to govern from the center. giving him a hard time only makes the tea party republic happy.

  • miseshayekrothbard2

    The 1937 recession was only because of reduction in spending as far as it was a correction on the false economy that the spending created. You cant keep spending and racking up deficits forever and as soon as you turn off the spigot, there WILL be a recession.

    Other reasons included inflation due to increasing gold stocks (fiat causes even worse inflation), unions and minimum wage putting a stranglehold on prices and employment, and heavy government regulation made it difficult for business.

    The spending reduction caused a ghost recession, or a correction, because the economy shouldnt have been that way in the first place.

    Anyway, deficit reduction is necessary to end the economic horror we face. We cant spend our way out of this. Its just not going to work. How much money needs to be spent and for how long? Why dont we just have a quadrillion dollar stimulus? The economy would shoot off into space with that, according to Keynesians.

    The solution is to reorganize Medicare and Social Security by raising the retirement ages that have been set in stone for decades, despite people working and living longer. The other half of the solution is to end the Empire, end the Bush-Obama war machine, and cut the Pentagon by half a trillion.

    • MrDHalen

      Nothing about taxes? Really??

    • nicole

      You were banned TWICE as the right wing tool that you are.

      You are barking up the wrong tree, and if your bosses at astroturfers, inc. had a single clue, they would direct you to go elsewhere. Like Huffpost. Where the stupid people rule these days.

    • JMAshby


    • mrbrink

      How do you calculate the weight of your shitty diaper on U.S. currency?

    • mrbrink

      You, and better arguments like yours, seem to be predicated on the idea that America is going away. That it needs to be liquidated to not have to owe some shady, wealth distributing bar tab when it does, and for toothless one-legged barefooted poor people no less! That things are so out of control and beyond our understanding of your alt-government finance initiatives(gold standard, low taxation, stop crowding out the job creators, socialists! Welcome to the jungle!), that we’re going to spin off into space if we don’t cut the deficit and gut the U.S. government’s role in keeping the faithless crazies away from the steering wheel.

      I see no reason why the United States government, if kept away from you specifically, won’t be around to pay our bills 100 years from now, or a quadrillion, if that’s what it takes to improve upon America’s lost time to misery profiteers.

      You’re a doomsayer. How the hell do you get through the day?

    • incredulous72

      The ignorant is strong in this one.

  • Justin Cohen

    Thanks, Bob. I agree with you. One small typo: “even when spending remains higher that normal.” I like Chez but I miss the Bob and Elvis show. Any chance of reconciliation?

    • Dave Krebs

      I say, “Bob and Chez FTW.”