JUDGMENT CALLS
Robert J. Samuelson
The Rise of Fantasy Politics
Obama and McCain have each taken symbolic steps to suggest that they've made tough budget choices. Don't believe them.
What we have here—to borrow a line from the old movie "Cool Hand Luke"— is a failure to communicate. By all rights, we should be having a fierce debate over the role of government. What should it do, for whom and why? What works? What can we afford? Who should pay? These questions would suggest a campaign that seriously engages the future, but instead and not surprisingly, we have a bidding war between candidates to see who can promise the most appealing package of new spending programs and tax cuts.
As we watch the conventions, we should recognize that we've entered an era of fantasy politics. Like fantasy football and baseball, fantasy politics is an exercise in make-believe that is intended to keep its players occupied and to make the winners feel good. Barack Obama and John McCain emit pleasing slogans and programs that, as often as not, are disconnected from the country's actual problems. But unlike fantasy sports, fantasy politics has lasting consequences. Winners must govern and, after creating unrealistic expectations, have a hard time doing so.
Last week, I viewed "I.O.U.S.A.," an 87-minute documentary exploring the grim budget outlook. It is unbalanced budgets that, in many ways, define the political deadlock. The persistence of deficits over so many years (42 of the past 47) can have only one basic cause. Politicians of both parties and the public prefer spending to taxing. As everyone knows, the disconnect will worsen, because aging baby boomers will bloat outlays for Social Security, Medicare and Medicaid. These programs already total nearly two fifths of the $2.9 trillion federal spending in 2008.
The documentary's sponsors hope that it will arouse public opinion on budget issues in the same way that "An Inconvenient Truth" did on global warming. Maybe it will, but I'm skeptical. It's not just that melting icebergs are more compelling images than charts of mounting government debt. The mismatch between the government's existing spending commitments and the present tax base is so great that we cannot just tinker a little with government. The required correctives are politically arduous. By 2030, federal taxes could rise 50 percent if all spending programs are kept on automatic pilot, notes Andrew Yarrow in his book "Forgive Us Our Debts."
That would be, I think, an unconscionable burden on workers (the main taxpayers) and a huge threat to the economy. Over the years, I've suggested changes to minimize these dangers. Eligibility ages for Social Security and Medicare should gradually rise to 70; people now live longer and should work longer. Medicare premiums for middle-income and richer retirees should increase; the young shouldn't bear most of the expense of growing health costs. Government programs that have outlived their usefulness or are wasteful should end: farm subsidies and Amtrak, for instance. More possibilities are discussed in the useful book "Where Does the Money Go?" by Scott Bittle and Jean Johnson of Public Agenda.
But "I.O.U.S.A." barely mentions choices and solutions. It provides no moral or political framework for reconciling the public's appetite for open-ended spending and its desire for limited—or declining—taxes. What should we keep, modify or discard? Why? Ideally, of course, our political leaders would assume the task of teaching, choosing and persuading. Unfortunately, they are conspicuously delinquent.
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Member Comments
Posted By: mikefarrace @ 09/17/2008 5:54:37 AM
Comment: In the heat of election politics, it's really good to read some common sense.
As citizens, we are forced to perform a kind of voodoo exercise in which we decide which candidate will figure it out when they get there. Unfortunately, the electorate has communicated to politicians that we don't want reality. The first candidate who says "it's going to cost you," is instantly marginalized. We just don???t want to face the music.
I would like to say that, at least, we operate from our self-interest, but that's not true either. To continue your sports analogy, we view candidates like we view our favorite team or Nascar driver, two examples of choices we make that have little to do with fulfilling any substantial self-interest, but which instead make us feel better for a little while when our guy beats the opponent???s guy.
In this election, I prefer Obama of the two candidates. I have read all the positions on both candidate???s websites, read the news like a junkyard dog looking for clues to success and that???s just where I land. I trust him more, think he will unite the country and think he has the organizational chops and intellect to sort through the myriad challenges facing the next president.
I do think the unfettered free market philosophy has failed. I think the reason for that is nothing more than human nature. And, I must admit, I just think it???s time to give the other party a chance to run the thing. I think Republicans have had their chance and things just haven???t worked out so well.
I would like to think there is an equitable system that can provide for a decent living for all Americans and to also reward the industrious, creative and lucky among us appropriately. But your comments resonate with me because I believe that to achieve such a system, you must start with a balanced budget and a pay-as-you-go fiscal philosophy.
If we lived in such a world, I think it would then be possible to build responsive institutions which work on behalf of all people. Universal health care, low-interest student loans, correctly regulated and above reproach financial markets, Social Security that actually pays enough to live on.
When you mention further clutter in an already complex tax system, you???ve also got a point. But more important are the unwieldy and overly complex number of levers available to government. It???s like a giant mobile gone awry. With a balanced budget at its core, the techniques available to those in office would be much simpler, and much more effective in addressing the needs of citizens.
Posted By: homnickj @ 09/11/2008 12:49:46 PM
Comment:
It saddens me to see how distrustful we are of our current government that we even have trouble believing propositions of potential presidents. Samuelson???s article makes sense but only because of the current funk our country is in. If the current president???s approval rating was higher, the public would have a much easier time swallowing speeches that promise economic prosperity. For the record, I agree with Samuelson in that candidates use rhetoric to win applause and not to benefit the general welfare of our country, but its a sad state of affairs when we claim that candidates "talk the talk but don't walk the walk" before we even see any of them walking.
Posted By: Masonomist @ 08/29/2008 10:43:50 AM
Comment: Robert Samuelson is correct: regardless of which party wins the White House or Congress, Uncle Sam is unlikely to get his fiscal affairs in order ("The Rise of Fantasy Politics," September 1).
In principle, government's core responsibility is to prevent Jones from benefiting by his imposing costs on Smith without Smith's consent. In practice, government acts as Jones's agent in securing benefits for Jones by imposing costs on Smith.
Government's modus operandi today is to bestow goodies on politically powerful interest groups, and to pay for these goodies by taxing politically unpopular groups (e.g., oil companies) and politically impotent groups (most notably, future taxpayers). The bottom line is that, through government, Jones imposes costs on Smith without Smith's consent.
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
Enterprise Hall
George Mason University