John McCain is enough of a straight talker to posit the question:
Quote:"Basically, which is it?" the man asked Mr. McCain. "Straight talk: Do you want to raise taxes, cut entitlement spending, cut defense spending, or have a deficit?"
But not enough of a straight talker to actually, like, answer it.
Basically, he's opting for magic as answer: he will neither raise taxes,
nor cut entitlement spending,
nor cut defense spending,
nor have a deficit - everybody can have everything! - because, well, supply siders magic will work its way:
Quote:"When Ronald Reagan came to office,'' he said, noting that few in the audience were old enough to remember, "we had 10 percent unemployment, 20 percent interest rates, and 10 percent inflation, if I've got those numbers right. That was when Ronald Reagan came to office in 1980. And so what did we do? We didn't raise taxes, and we didn't cut entitlements. What we did was we cut taxes and we put in governmental reductions in regulations, stimulus to the economy, and by the way, Jack Kennedy also did that as well - and so my answer to it is a growing economy. And I think you best grow the economy by the most efficient use of the tax dollar.''
Mr. McCain - who has said that he wants to balance the budget while making the Bush tax cuts permanent, cutting additional taxes, and keeping troops in Iraq - said: "I believe we can grow this economy, and reduce this deficit.''
Of course, the whole notion that you can have it all depends on drinking the supply siders kool aid about how cutting taxes will actually
increase government revenue.
While it's widely accepted that tax cuts stimulate the economy, the contention of some ideologues that they stimulate the economy
so much that they actually yield a greater revenue than there would have been without tax cuts is a fairy tale, which was rejected even
on the National Review. It just isnt taken seriously by economists outside, say, the Cato and Hoover Institutes. It may be true for some hypothetical economies with exorbitant tax rates, but definitely does not work that way for the US and its taxes.
But apparently McCain drunk the kool aid. To do so, of course, he needed to overlook some inconvenient facts about the Reagan presidency which he cites as the example he wants to follow:
Quote:[McCain] approvingly cited the example of President Ronald Reagan. There was one thing he did not mention during his response: the deficit nearly tripled during the Reagan presidency, partly due to tax cuts and increases in military spending.
Source:
The Caucus