“I promised to level with the American people,” he says early on, noting that he has called for phasing out ethanol subsidies that largely benefit the first-in-the-nation caucus state of Iowa, to raise the retirement age for future generations of Social Security recipients, and to means test the annual cost-of-living adjustments for those recipients.
Fine. That would help reduce deficits in the years ahead (although the Social Security changes are far more significant than the ethanol one). They represent, however, just a first step to address deficits that are expected to average $1 trillion a year over the next decade and an unsustainable 6 percent of GDP before heading much higher in the decades after that.
That’s about where Pawlenty’s courage ended and his intellectual flim-flam began.
First, he says we should aim for five percent annual economic growth, rather than the barely 2 percent of recent years.
It’s hard to argue with that one. But, five percent is not attainable in the short term, nor is it attainable for a sustained period even in the long term.
For one thing, the economy is continuing to climb its way out of recession and probably will be for the next several years. It can’t, and won’t, grow at five percent any time soon.
For another, even Pawlenty knows that five percent growth is a stretch because he cites two recent periods of strong growth – 1983 to 1987 and 1996 to 1999 – and while each came close to five percent, neither attained it. Thus, Pawlenty proposes a growth level that, even in the best of circumstances, is almost certainly beyond reach.
Second, he says we should dramatically cut corporate and individual tax rates and, on the individual side, also end all taxes on capital gains, interest, dividends, and estates.
But, for all his promises to “level with the American people,” he never mentions that the only way to even partially offset the revenue drain is to dramatically scale back, if not end the tax-free treatment of employer-provided health care, the mortgage interest deduction, the deduction for state and local taxes, and other popular tax breaks.
Third, he calls for balancing the budget and proposes that Congress give the president emergency power to “impound” – that is, not spend – up to five percent of the budget until it reaches balance.
He doesn’t specify what five percent he would impound. But the budget is not generalities. It is specifics.
And, specifically, budget spending is dominated by Social Security, Medicare, Medicaid, and defense. If he wanted to protect any of those programs, he’d have to cut more from the rest – things like the FBI, border security, environmental protection, education, medical research, homeland security, and veterans’ medical care.
A presidential candidate who promises to “level with the American people” can clearly do better than this.
Lawrence J. Haas is former Communications Director to Vice President Gore and, before that, to the White House Office of Management and Budget. He's now a public affairs consultant who writes widely about foreign and domestic affairs, including fiscal policy.
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