Outside View: Supply Side Insanity

Outside View: Supply Side Insanity

Maybe a sign our valiant press corps are finally waking up to the fact that the Iraqi war games aren't the only scripted models out there.

"This looks like a rerun of a bad movie." So says President George W. Bush when it comes to the failures and limitations of Iraq weapons inspections. He should of, however, been using this phrase to discuss another left-over policy failure of his father's and of Ronald Reagan's administrations: Supply-side economics.

When will it finally sink in, that if insanity is repeating the same inanity ad nauseam, and expecting a different result, Bush's current economic stimulus plan is the Howard Hughes of fiscal policy. All this because some ideologue named Arthur Laffer was bored one night in a bar and drew some farcical design on a napkin, which then came to be called Reagonomics.

Here are the facts, plain and simple. President Reagan did not cut spending during the 80's as is so often claimed, but increased it overall with his huge defense budgets, and even through restructuring Social Security to add federal workers into its universe.

He cut marginal tax rates by historic amounts, but then raised payroll taxes, closed corporate loopholes -- Read: raised corporate taxes -- and even raised the gas tax. Still, he managed to quadruple our national debt while enacting this "conservative" program.

Two presidencies later, Bill Clinton, that "economic liberal" that he was, with the help of Hamiltonian treasury secretary and former chairman of Goldman Sachs, Robert Rubin, did much the opposite. "Rubinomics" as it is derisively called by captivated tax-cutting conservatives, put a premium on balancing the federal budget and bringing down long-term interest rates in the process, giving us a decade of historic prosperity.

I don't need to go through all the figures here. Well, how about just a few. Twenty-three million new jobs created under the Clinton Administration. Unemployment at 4 percent. An explosion in technological innovation. Ahh, remember those days.

Now splash some cold water on your face and come back to the dreary present.

Let's hope they keep adding calcium to their spinal region and stop falling prey to the Zombie mind tricks.