I think Lawrence Kudlow reads ginandtacos. He reads it daily and fancies himself the recipient of an FJMing. That is the only conceivable reason he could write a column entitled "It's Time for Supply Side Tax Cuts." At this point you probably think I am shitting you. Let me be clear and unequivocal: I am not shitting you. The column is entitled "It's Time for Supply Side Tax Cuts." This would make sense if it was 1983. It's not.
The bailout-nation saga continued this week as the little-three carmakers from Detroit drove to Washington to plead for a $34 billion federal package to save themselves from bankruptcy and insolvency.
I feel like the straight man / host of an infomercial – that person paid to say "There's no way that a single Sham-Wow can soak up all that hot, viscous minestrone!" or "The NuWave oven can't cook all that food in under 30 minutes, can it?" My sole purpose is to set up Kudlow's eventual Hayek-approved tomahawk dunk. So be it.
"Gee Lawrence, is there an alternative to the bailout that keeps money away from those Fat Cats in Washington?"
Hot on their heels was a devastating report of 533,000 lost jobs in November. Actually, it's a loss of 732,000 jobs, including downward revisions from the prior two months. Unemployment moved up to 6.7 percent from 6.5 percent, a number that's going to get worse as the volume of discouraged workers continues to rise.
Don't forget to tack "and when the auto industry goes bankrupt like my fellow conservatives want it to" on the end of the last sentence.
So here's the painful choice for both Republicans and Democrats in Congress: Will the political class risk a Detroit-carmaker bankruptcy that might lead to catastrophic liquidation — including, realistically, a couple million car-related jobs — all while the recession deepens and job losses mount (1.2 million in just the past three months)?
That would be one hell of a risk to take in a democratic nation, but fortunately we do not have regular elections. Thus is the "political class" spared from retribution and should do the "right thing."
Wait, we do have regular elections. So we need to shame the political class into having the "guts" to do the "right thing."
It's a tough choice
That does not sound like a tough choice at all. It is not even remotely tough. This is the categorical antithesis of a tough choice. It is as tough as the entrance exam at Arizona State. This choice scores a seven ("Watery, with no solid pieces; entirely liquid") on the Bristol Stool Scale.
I think what you mean, L-Dawg, is that Congress is forced to choose from two bad options. They are both bad. That does not mean that they are equally bad. Let's say that you have two choices for your upcoming weekend. Option #1 involves your hated in-laws, hours of home movies of their trip to Branson, and backbreaking yard work. Yuck! Option #2 is to spend 48 hours being repeatedly raped by a particularly horny and flatulent Michael Clarke Duncan.
Your call, Larry.
especially for Republicans, most of whom want to vote against bailout nation and stop big-government encroachment on our free-market economy.
If any sentence accurately summarizes the way the Republican Party has governed in the last 30 years, this is it.
That's the right theory.
And that's all it is: a theory. Also, no.
But are the economic risks simply too great to employ it?
Yes. That is why it never gets employed, even when your fiscally conservative heroes are in complete control of all three branches of government.
Various polling surveys say bailout nation, and a federal rescue for autos in particular, is very unpopular. At least 60 percent are polling against a bailout. The TARP bailout of banks is increasingly unpopular.
Stunning. Relevant. Stunningly relevant. Who would have thought that financially struggling Americans, most of whom need to have episodes of Who's the Boss? explained to them during the commercial break, would oppose something called a "bailout" involving billions of dollars being redirected to Fat Cats and other stock characters from the populist narrative?
Meanwhile, the pressure for more bailouts grows daily. The Avis rental-car company wants a bailout from TARP. A company called BlueFire Ethanol wants a bailout. The trade association for equipment-leasing companies wants a bailout. There's no end to it. And if we keep going down this path we'll make a mockery of free-market capitalism.
Slippery slope. Learning to say "no" would be a pretty comprehensive solution. Avis can go out of business because Avis is irrelevant to our economy. The entire auto industry isn't.
Coming back to Detroit, there may be a pragmatic solution, one that takes some of the apocalypse-now threat of major economic decline out of play.
My ass tingles with anticipation.
Senator Bob Corker and others have proposed a federal oversight board that would in effect become a bankruptcy court. Strict conditions would be imposed on the carmakers,
Three sentences after he said that most Republicans want to get government out of the economy, this is his example of a good idea: the Soviet model of centrally planned industry.
especially regarding compensation
Read: "Congressionally sponsored Union-busting." That's what the 59-Democrat Senate is going to do, turn things over to Bob Corker to decide what wages should be paid in an industry employing millions.
the single-biggest reason for Detroit's decades-long decline.
I thought the inability (or purposeful unwillingness) to make a $30,000 car that doesn't need three new transmissions before 50,000 miles had something to do with it.
(uninteresting "pampered workers make too much for Detroit to compete" boilerplate omitted)
There still will be considerable job losses for downsized Detroit carmakers. They'll have to cut a huge chunk of their dealer networks. Domestic brands will have to be sharply reduced. But essentially, as would be the case under Chapter 11 bankruptcy, the federal government will provide short-term financing while Detroit goes through its radical restructuring. It looks like bankruptcy lite, and it will completely change the direction of the former Big Three.
And who's going to make the judgment calls on how and where cuts will be made? Bob Corker? Lawrence Kudlow? Or the jackassed auto industry executives who ran their companies down the drain in the first place?
Boy, I sure hope you have a better idea than "Congressionally mandated wages and production decisions," Comrade Kudlow.
It's probably too much to ask, but tough federal action under the aegis of oversight-board enforcement also should relieve the CAFE fuel standards that have plagued U.S. automakers.
Read the following in your best Milhouse from The Simpsons voice: "When are they gonna get to the fireworks factory!???!??!"
Jesus H., Larry. Your headline promised something that this pastiche of right-wing bugaboos which kill our economy (unions, the environment, lazy workers, occasional Rodan attacks) is not delivering.
At the very least, worldwide standards should be substituted for domestic ones. Making expensive small green cars is an unprofitable business.
You know what is profitable? Making grotesque land barges! Like when GM made that great decision in 2005 to halt its passenger car development in order to rush the new GMC Yukon / Suburban / Escalade family of armored fighting vehicles to dealerships. Why, it practically rained money thereafter in Detroit.
Ironically, with oil and retail gasoline prices plunging, it's not unreasonable to expect something of an auto-sales recovery. Gas prices have dropped all the way to $1.75 from over $4. This tax cut will help revive the whole economy, along with auto sales.
GET TO THE FUCKING TAX CUTS, LARRY. I SWEAR TO GOD IF YOU DO NOT SAY SOMETHING ABOUT SUPPLY-SIDE ECONOMICS IN THE NEXT THREE SENTENCES I AM GOING TO EAT AT P.F. CHANG'S EVERY DAY FOR SIX WEEKS AND SHOW UP AT YOUR FRONT DOOR ASKING TO USE THE BATHROOM.
But if Washington can put this car-bailout business behind it, perhaps Congress can move on to the ultimate solution: restoring economic growth.
Thank you. Was that so hard? We know what "restore economic growth" means in Republican.
President-elect Obama has been cagey about the details of his massive $700 billion infrastructure spending plan and whether he'll raise taxes on successful earners.
I think he's been pretty clear about the latter.
But this new New Deal, including Obama's middle-class tax credits, will not create permanent economic growth incentives. What will?
OMG THIS IS SO EXCITING! I WONDER WHAT HE'S GOING TO SAY?!?!?!11!!!?!ONE!!?
A conservative columnist asking a rhetorical question like this – "What, you ask, will prompt runaway economic growth?" – produces the same mixed feeling of dread, recognition, and boredom as when one of the guests in Fawlty Towers turns to Manuel the waiter (you know, the lovable Spainiard who no-speaky-eeenglish so good) and orders a Screwdriver. Everyone knows exactly what's coming and it'd be funny if it weren't so damn obvious.
A genuine supply-side growth agenda to reduce tax rates across-the-board.
Post-1980 Republicans: "THE ANSWER IS TAX CUTS ACROSS THE BOARD, BUT ESPECIALLY CORPORATE TAXES!!!! Now what was the question?"
If the Republican party wants to put bailout nation to rest it should campaign for lower corporate, individual, and investment tax rates.
As opposed to now or the last 30 years.
Good suggestion, Larry. Republicans have never tried this. They certainly don't bring up tax cuts like their asses are afire and saying the phrase "lower taxes" will bring down torrents of soothing water.
It should make clear that the Democrats are the government-spending party while the Republicans are the tax-cutting party.
To whom is this revoltingly oversimplified binary unfamiliar? I just called the Topeka Home for the Retarded and asked for a random tard who proceeded to correctly connect the phrases "Republican Party" and "cutting taxes." Unconvinced, I empaneled a focus group of people with traumatic brain injuries who were also able to connect those phrases.
Everyone already knows this, Larry. The problem is not recognition – the problem is your ridiculous assumption that cutting taxes is always a good thing or that people are always wildly in favor of it.
Like, when I say "Carrot Top" or "Zamfir" the average person automatically thinks "prop comedy" and "Master of the Pan Flute", respectively. The reason Carrot Top and Zamfir, Master of the Pan Flute are unpopular is not that people fail to associate them with the appropriate shtick. The problem is that prop comedy and the pan flute are horrible, horrible things that I wouldn't wish on a Welshman.
We will not bailout our way into prosperity. Nor will we spend our way into prosperity. Somebody has to stand up and yell: It's time to cut tax rates on the supply-side.
I'm sure someone in Congress would do this, taking this heroic stand a la Jimmy Stewart in Mr. Smith Goes to Washington, if not for the fact that voters tend to dislike completely retarded thirty year-old ideas that have repeatedly been proven useless. Larry, why must you talk like this has never been tried, like the idea is novel? Unless "income redistribution toward the highest brackets" is the objective, Supply Side tax cuts have been an unqualified failure.
That will reinvigorate growth and infuse new spirit into a demoralized economy.
"Why? Because I say it. I don't have any evidence, but you don't need evidence when you're this fucking right."
Lawrence Kudlow, avid reader of ginandtacos: this was a disappointment of monumental (New Coke) proportions. Sucking us in with an eye-grabbingly stupid headline and then tossing us a few crumbs of discredited economic "wisdom" at the end is….well, Larry, it's just a dick move.
Then again, given how little there is to say in support of your idea, I'd tack it on the end of 10 paragraphs of gibberish too.