What Small Government Really Looks Like: Not a Pretty Picture!

Once upon a time, America had a small government.

Before World War I, government spending was less than 10 percent of the economy. During the Great Depression, it reached 20 percent. By 1960, it hit 30 percent. And so, for the past fifty years, one in every three dollars spent in America were spent by Uncle Sam.

In 2012, the Republican presidential candidates have staked their campaigns on a promise to reverse this trend. Many Republicans openly pine for the good old days of rugged individualism — the days before Social Security and Medicare, before the FDA and the EPA, before income taxes and government-backed mortgages.

You might think that such an extreme position belongs to rabble-rousers like Glenn Beck but not mainstream pragmatists like Mitt Romney. You’d be wrong.

Candidate Romney has proposed cutting taxes annually by $180 billion, mostly for the top 1 percent of income earners. At the same time, he has pledged to balance the budget without cutting defense spending. According to the Center on Budget and Policy Priorities, the only way to fulfill all these promises is to cut nondefense programs by 50 percent.

In other words, Romney wants to get rid of half of everything the government does, except Social Security and the military.

Half of our schools. Half of our national parks. Half of our federal law enforcement. Half of our food safety. Half of our clean air. Half of our veterans’ health care. Gone. Forever.

And Romney is no exception. If anything, his proposal is tame in comparison. Newt Gingrich’s proposal, for example, would cut taxes by $850 billion. You can just imagine the carnage.

In Tuesday night’s State of the Union address, President Obama staked out the opposite position, asking Congress to raise taxes slightly on millionaires and to use half the savings from ending the wars in Iraq and Afghanistan to reduce the budget deficit. The other half he pledged to public infrastructure projects.

And not a moment too soon.

Over the last fifty years, infrastructure spending has steadily fallen as a share of the economy. We now spend 2.4 percent of GDP on transport and water infrastructure, compared to 5 percent in Europe and 9 percent in China.

According to government reports, one in four bridges need significant repairs or are bearing more traffic than they were designed for. 700 water pipes burst every day because they’ve worn out. One in three roads are in substandard condition, increasing traffic fatalities, congestion, and gas emissions. 1,300 dams have been designated “high-hazard,” meaning they could fail and result in fatalities. We spend $50.6 billion every year just to clean up spills from old sewage systems.

In recent years, state and local governments, which contribute the vast majority of infrastructure spending, have shrunk significantly in the wake of unprecedented budget shortfalls. The federal government needs to step up, but the Republican candidates would rather scale down.

There will never be a better time to rebuild our infrastructure. Millions of Americans desperately need jobs. The government can borrow at near-zero interest rates.

We’ve been here before.

In 1935, with unemployment at 20 percent, the government created the Works Progress Administration. Over the next eight years, the WPA provided eight million jobs. It built or renovated 560,000 miles of roads, 20,000 miles of water pipes, 417 dams, 2,700 firehouses, 5,000 schools, 1,800 hospitals, 2,000 stadiums, 1,800 runways, and 6,000 fire and forest trails. By 1941, before the United States entered World War II, unemployment had fallen to 6 percent.

We can do it again.

Or we can go back to the nineteenth century. We can go back to a world without paved roads or bridges or clean water, with one-room schoolhouses spaced many miles apart and hospitals that took hours to reach. We can go back to the days when sewage was untreated and floods overwhelmed many towns, when recessions were more frequent and unemployment rose more sharply.

We can go back to small government, if we’re willing to give up our way of life.

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This op-ed was published in today’s South Florida Sun-Sentinel.

What to Read on Rick Perry

In Texas, Perry Rides an Energy Boom — Clifford Krauss

[The] state’s economic health came at a steep price: a long-term hollowing out of its prospects because of deep cuts to education spending, low rates of investment in research and development, and a disparity in the job market that confines many blacks and Hispanics to minimum-wage jobs without health insurance.

When Mr. Perry succeeded Mr. Bush, a barrel of oil was $25. [During] his first term, global market forces began driving oil prices up. They peaked at $147 a barrel in 2008 and have largely remained above $80 over the last two years.

The oil and gas industry now delivers roughly $325 billion a year to the state, directly and indirectly. It brings in $13 billion in state tax receipts, or roughly 40 percent of the total, financing up to 20 percent of the state budget.

The federal government has also helped support Texas. Federal spending in the state, home of NASA and large Army bases, more than doubled over the last decade to over $200 billion a year.

[Before Perry entered office,] the Legislature enacted tight restrictions on mortgage lending, which helped Texas avoid the kind of real estate bubble that devastated states like Florida and Arizona.

The Ten Weirdest Ideas in Rick Perry’s “Fed Up” — Matthew Yglesias

10. Social Security is evil.
9. Private enterprise blossomed under conscription and wartime price controls.
8. Medicare is too expensive but must never be cut.
7. All bank regulation is unconstitutional.
6. Consumer financial protection is unconstitutional.
5. Almost everything is unconstitutional.
4. Federal education policy is unconstitutional.
3. Al Gore is part of a conspiracy to deny the existence of global cooling.
2. Not only is everything unconstitutional; activist judges are a problem.
1. The Civil War was caused by slaveowners trampling on Northern states’ rights.

Rick Perry’s Neocon Friends — Robert Dreyfuss

…Perry declares that “exceptional” America has to be prepared for war with China and India.

Perry is consorting with left-over neocons from the Bush administration,…such as Douglas Feith, the uber-hawk who oversaw the war in Iraq, and Bill Luti, Feith’s compatriot in the Bush White House, who joined with Vice President Cheney to persuade Bush that an unprovoked attack on Iraq was the right thing to do, and Dan Blumenthal, another Bush veteran…

Rick Perry’s Budget Sleight-of-Hand — Suzy Khimm

The Texas governor…used accounting sleights-of-hand that deferred payments and papered over enormous expenditures that will soon come due…though not until the 2012 election is over.

Perry’s budget assumes that the student population will remain constant, when more than 160,000 new students are projected to enroll in Texas public schools over the next two years.

Perry’s budget only covers Medicaid funding through the spring of 2013, coming up $4.8 billion short.

Finally, Perry’s budget ignores a $4.5 billion structural deficit that happens every year due to a 2006 tax reform that’s never generated as much revenue as expected.

Rick Perry’s Environmental Record — Dylan Matthews

[Unlike] Mitt Romney, [Perry] does not believe in the science behind climate change…

He filed a lawsuitagainst the EPA’s greenhouse gas emissions regulations on behalf of the state, a suit widely expected to fail. Perry has said that he prays daily for the EPA rules to be reversed. He has consistently defended oil and coal interests in Texas, notably dubbing the BP oil well blowout an “act of God” and opposing the Obama administration’s efforts to regulate offshore drilling in the wake of the disaster. He also fast-tracked environmental permits for a number of coal plants in 2005, cutting in half the normal review period. His transportation agenda similarly does not reflect any concern about emissions, as he did not compete for federal high speed rail funding and has kept state funds focused on roads rather than mass transit.

Rick Perry’s Medicaid Record — Sarah Kliff

Perry [said] that he’d “like to see the states be given the opportunity to opt out of the Medicaid program that we are looking at today.”

In 2008,…Texas applied for a waiver allowing it to limit the number of beneficiaries and create a comparatively sparse benefits plan, among other changes.

The Bush administration rejected Texas’s…waiver request. There was “no precedent,” an administration official said in explaining the decision, in approving an “annual benefit limit as low as” the Perry administration proposed.

Perry Threatens Bernanke — ThinkProgress

…Perry said, “If this guy prints more money between now and the election, I dunno what y’all would do to him in Iowa but we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in American history is almost treasonous in my opinion.” Treason is a capital offense.

What to Read on Tim Pawlenty

Pawlenty Stands Against Clean Air — Raj Salhotra & Stephen Lacey

Former Minnesota Governor Tim Pawlenty doesn’t seem to like any sort of regulation: “We need less EPA monitoring of our economy. And more monitoring of EPA’s affects on our freedom. I will require sunsetting of all federal regulations. Unless specifically sustained by a vote of Congress.”
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According to a 2010 EPA progress report: “An analysis estimates annual public health benefits of the program in 2010 alone at more than $120 billion, about 40 times the estimated cost. Power plants have decreased emissions of SO2, a precursor to acid rain, to 5.7 million tons in 2009, a 67 percent decrease from 1980 levels and a 64 percent decrease from 1990 levels.”

A Contender to Reshape GOP’s 2012 Image — Dan Balz

He argued strongly for a stay-the-course policy in Afghanistan. He opposed President Obama’s July 2011 deadline for the start of a drawdown of forces and said more troops might even be necessary to assure eventual success.

On fiscal issues, he said the administration has spent too much for too little on the economy and that, if…the president’s debt and deficit commission then offers recommendations that include any new taxes, “it’s going to be a non-starter.”

He called the new health-care law misguided and said he and most Republicans still want to repeal it and replace it with something else. He said Arizona’s new immigration law has been “wildly and irresponsibly and recklessly mischaracterized” by government officials including the president.

Is He Too Nice for His Own Good? — Michael Crowley

Ventura had left behind a $4.5 billion deficit, which Pawlenty closed not by raising taxes (which he would slash by $800 million over the course of his term) but by dramatically slowing spending. He vetoed dozens of Democratic tax-hike bills, and in 2005 he allowed a nine-day state-government shutdown rather than give in to the Democrats’ budget demands.

In 2005, Pawlenty set out to cut the generous pension benefits of the state’s mass-transit workers’ union, triggering a 44-day strike before the union cried uncle. […] On social issues, Pawlenty approved tough new abortion restrictions and gave local school boards the freedom to teach intelligent design as an alternative to evolution.

Critics say Pawlenty used accounting shortcuts, like postponing spending and accelerating revenue collection, to balance budgets. Today, Minnesota is struggling with a projected budget deficit of $5 billion, which some blame on Pawlenty. “I don’t think any governor has left behind a worse financial mess than he has,” says Arne Carlson, a Republican who was Minnesota’s governor from 1991 to 1999.

But he tends not to mention the help he got from nonconservative sources — including more than $2 billion from an Obama stimulus bill that he has trashed as “largely wasted” and a 75 cents cigarette-tax hike he swallowed to end that 2005 budget shutdown.

Pawlenty will also have to explain to conservatives his stint of activism on global warming, which in 2007 he called “one of the most important [issues] of our time.” He signed bills promoting clean energy and a cap-and-trade system of carbon limits similar to the model envisioned by Obama. He toured the state with the Minnesota-based Arctic explorer Will Steger to “convince the skeptics,” as he put it, and even considered visiting the Arctic. He made a 2008 radio ad urging Congress to “cap greenhouse-gas pollution now!” But he now takes it all back, saying the human impact on climate change is unproven. “It was a mistake, and I’m sorry,” Pawlenty said…

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A Very Unfortunate Time to Say “I Told You So”

I published the following op-ed six months ago:

Aren’t you tired of all the surprises? Don’t you wish, just once, we could prevent a crisis instead of reacting to it?

Here’s your chance.

If you’re like most Americans, you were shocked to learn that the law only required BP to pay $75 million of the damage from its oil leak. You probably felt a little cheated by Congress, which promised your tax dollars to clean up after a company that made over $20 billion in profits last year.

If so, you won’t be too pleased when I tell you that we afford the same kind of protection to our nuclear power plants.   Continue reading “A Very Unfortunate Time to Say “I Told You So””