The Democrat's Dilemma

John Campbell

7/2/2010 10:15:47 AM - John Campbell
I have been in elected office for 10 years now. And of those 10 years, I have spent half of that time in the California State Legislature and the other half here in Congress. During that time, I have found that a common thread exists amongst elected Democrats. At least part of the reason they ran for and are in office now is to raise taxes on somebody or everybody and then spend that money on people and programs which they deem worthy. A fundamental tenet of the Democratic Party today is that government should tax more and spend more on lots of things.

But that ideology has just run headlong into political reality. Polling shows that one of the top two issues on the minds of Americans these days is the debt and the deficit. The other big issue is jobs and the economy. And Americans realize that the two are related. They understand that our crushing debt burden, up 81% since Democrats took over Congress in 2006, is one of the drags on the economy. So, spending money that increases the deficit and the debt even further is not very popular right now. And of course, there is an election in just over 4 months.

So, if you want to spend new money without earning the rancor of the public, you need to either cut other spending by an equivalent amount or raise taxes by an equivalent amount. Raising taxes is never popular. But it’s particularly unpopular after you've just raised them by trillions of dollars in a very public and unpopular health care bill.  And because of the ideology described above, cutting other spending is very difficult within the Democratic Caucus because there are constituencies for every dollar currently being spent, and those constituencies don’t want to see it reduced. So, Democrats can’t agree to do it.

Hence the Democrat’s dilemma.  They want to spend more money on lots of things. They think that the only way to create jobs is to have the government spend more in order to create more government jobs. But they don’t want to vote for more deficit spending. They don’t want to cut any other spending. And, although they would like to raise taxes, they fear the ire of the voters in November if they do. That’s why they won’t pass a budget in the House this year for the first time since 1974. They want to spend the money, but they don’t want to vote to spend the money.

This is resulting in a form of gridlock here in D.C. as Democrats struggle to marshal the votes amongst Democrats for more spending programs knowing that no Republican will support any of this. Heretofore, Speaker Pelosi has always gotten her way. But it is getting more difficult as the debt rises and the elections loom. Just this week, Majority Leader Hoyer (D-MD) announced that Democrats may not be able to adhere to President Obama’s pledge to not raise taxes on families earning below $250,000. Although, it should be noted that this pledge has already been broken on several occasions, it was nonetheless quite interesting to see him admit that there are more taxes to come which will impact everyone. This is a clear signal that given the choice between no new spending, or cutting existing spending to pay for new programs, the Democrats are likely to choose neither and instead add on more and more tax increases or deficit spending or both.

They can’t help themselves. It’s why they came to Congress. But it’s the wrong thing at the wrong time. We can create jobs and lift the economy by cutting taxes and cutting spending and giving the private sector some certainty that if they take risks and succeed they will be rewarded and not punished. But this majority will never go there.

So, we will all be better off for the time being if all these tax and spend ideas just die.