Two and a half years ago, a Democratic-controlled Congress and Executive formulated a stimulus plan that was supposed to help America through a recession. It was a grand $787 Billion scheme meant to put Americans to work, keep unemployment below 8%, rebuild our infrastructure, and insure our nation’s solvency. Resorting to a Keynesian stimulus was a big risk; the equivalent of an individual maxing out his credit card for a trip to Las Vegas and betting all his money on a single roll of the dice. If the dice land in his favor, he wins big, but if they don’t he loses everything – except for the credit card bill that comes due.
Einstein once said of the universe that “God does not play dice,” but politicians do with the economy – especially with money that is not their own. At the time a number of people opposed the stimulus plan including me. I, along with many others, also opposed the bank bailout and demanded the heads of the banks at least figuratively, if not literally once the Democratic Congress coached by a Republican Treasury secretary pushed that through. Aside from the moral hazard the bailouts caused, the biggest problem was the assumption of debt.
As anyone who is indebted knows, debt limits freedom. If I’m paying the bank $400 a month on a car, I can’t spend that money on something else even more important. Say the car breaks down and I need to repair it; I can’t use that $400 to fix my car. Debt is the last thing you want in times of crisis. If your job situation is precarious or a new mouth is on the way, you need more cash and less debt.
Our government is now realizing the pain of indebtedness. The stimulus has failed; the Vegas dice throw has come up box cars and the $787 billion the politicians put on credit cards must be paid. Even though they could really use that $787 billion right now to calm the markets or stop the economy from moving into another recession, they can’t use it because they don’t have it.
It seemed like a great idea at the time. The trip to Vegas was very exciting. All the Democratic constituencies were purring like kittens in the laps of Nancy Pelosi, Harry Reid and Barack Obama. Had it worked, the Democrats and Obama would be heroes – and the Tea Partiers would truly be at the fringes as tax dodger/Vietnam War hero-pretender Sen. John Kerry imagines them to be today.
But now the Democrats are left with the hangover after the Vegas trip, and the bills are coming due. There’s no room on America’s credit card for another trip to Vegas for “double-or-nothing” and taxpayers like me are tapped out. There is a very good reason, aside from my personal belief that gambling is immoral, that I don’t gamble: I don’t want to lose everything. The Democrats gambled and lost; I hope they feel as bad as they pretend to feel, although I doubt it. While Clinton might be able to feel the pain of others, I doubt Pelosi, Reid, Kerry and the other millionaires in their party, can.
This doesn’t excuse Republicans. When the GOP controlled Congress and the White House government spending ballooned on everything from the Department of Homeland Security to entitlements. In fact the 2006 election which saw the GOP lose control of Congress was in part due to the dissatisfaction of many conservatives and libertarians who felt the party had become a clone of the Democrats, at least when it came to raiding the treasury.
But what spares the GOP some of the blame is the Tea Party within it. The Tea Party has fought for smaller government and reigning in spending since its inception during the government bailouts of 2008 and the stimulus of 2009. If it wasn’t for the Tea Party America would be in even worse shape. Don’t forget that it was the Democrats who demanded last Spring a “clean” debt ceiling bill that would have raised the debt ceiling without any spending cuts whatsoever.
Where is the Tea Party in the Democratic Party? Where are the fiscal conservatives on the Left? There aren’t any. They were purged by the fiscal liberals who took power in 2006 under Nancy Pelosi and Harry Reid. Men like Congressman Dick Gephardt and Zell Miller resigned rather than fight for their own seats against left-wing ideologues desperate to push their way to the government trough. Senator Joe Lieberman only survived the purge by leaving the party.
The Democrats looked to the left in Europe and dreamed of a party along the lines of European socialists, and after the 2008 election that landed them the White House, they had it. Margaret Thatcher once said that the problem with socialism is that eventually you run out of other people’s money, and reality has reasserted itself. The new era of fiscal conservatism has dawned on America and the Democrats (and a large group of Republicans) are woefully unprepared for it.