Now that the GOP has gained control of the Senate . . .

I’m continually amazed at the naivete of many reporters, pundits, bloggers and other people who comment on public policy.  Again and again we are told that there is some sort of grand philosophical divide separating the two parties, with the GOP favoring “small government.”  And indeed the rhetoric often does fit that stereotype.  But in practice it rarely works out that way.  Sometimes I wonder how many times people have to get fooled before they wise up. Apparently the increase in government spending (as a share of GDP) under George Bush wasn’t enough.  Nor was the decline under Clinton.  Nor was the increase under Nixon.  The latest excuse is that Bush was the old GOP, and now the small government fanatics of the Tea Party have taken over.  “Yes, the GOP wasn’t really libertarian before, but now it is.”

So I guess any day now we’ll start to see some big cuts?  After all, the GOP just won a huge victory in the House, and gained control of the Senate.  And we all know that “elections have consequences.”  OK, here’s your consequence:

Whatever happened to the big, bad federal deficit? You know, the red ink menace that was supposed to devour America’s fiscal future?

We ask because the way Congress is acting the deficit must have gone into hiding. Look at how eager lawmakers were to whoop through the “doc fix,” the big bill averting (permanently) planned reductions in Medicare reimbursements for physicians. It passed the Senate today by a 92-to-8 vote, having squeaked through the House last month, 392-to-37.

Yes, the move is popular, obviously. It resolves an issue that’s been a problem for years. Yet the doc fix is expensive, and only about one-third of its cost is offset by budget cuts. It’ll add some $141 billion to the deficit over the next 10 years.

.  .  .

And that’s not the only up-spending in the works. Add in likely increases in military and domestic spending, and the deficit could go up $100 billion in the next year alone, calculates longtime federal budget expert Stan Collender.

That would be about a 21 percent increase.

Virtually every policy change that has already or soon will be considered seriously in the House and Senate will make the deficit higher rather than lower,” writes Mr. Collender in Forbes this week. (emphasis added)

Brace yourself for a lot of phony rhetoric in 2016, about how the election is fundamentally a decision between the small government GOP and the big government Dems.


The two parties are like high school cliques, with the GOP representing the military, business, people who work with their hands, and Christians.  The Dems represent the poor, minorities, people who work with their minds, and public employees.  Government is simply a tool to further the interests of whichever group is favored or disfavored by the party in power.

PS.  I have a post on VAR models over at Econlog.

PPS.  NGDP growth expectations just fell to 3.5%.  Who says I can’t move markets?

PPPS.  3.4%!!

PPPPS.  3.3%!!!!!!!

PPPPPS.  3.2%!!!!!!!!!!!





14 Responses to “Now that the GOP has gained control of the Senate . . .”

  1. Gravatar of Brian Donohue Brian Donohue
    29. April 2015 at 09:10

    “The two parties are like high school cliques, with the GOP representing the military, business, people who work with their hands, and Christians. The Dems represent the poor, minorities, people who work with their minds, and public employees. Government is simply a tool to further the interests of whichever group is favored or disfavored by the party in power.”

    Yeah, more or less. Also, 3.4%.

  2. Gravatar of Kgaard Kgaard
    29. April 2015 at 09:39

    I think you miss one more important category: The Republicans represent married men and their wives. The Democrats represent single women. Neither party represents single men.

  3. Gravatar of cthorm cthorm
    29. April 2015 at 10:31

    Scott –

    The proper model for US politics is monopolistic competition between 2 firms. Their optimum strategy is to locate next to each other and engage in aggressive branding (ideological rhetoric).

    There are ways to disrupt this market structure (not all democracies have 2 nearly identical parties dominating), but they get virtually no attention. Pushing a 3rd Party is less than useless, unless you reform voting rules.

    The simplest solution is the Alternative Vote: Each voter lists their candidates in order of preference. AKA “Instant Runoff Voting”.

  4. Gravatar of Kgaard Kgaard
    29. April 2015 at 10:41

    Cthorm — Agree on the monopoly construct. That’s a better way of capturing what I was trying to say: Both parties favor the interests of women over men, because women vote as a bloc on certain issues whereas men generally don’t. So game theory says politicians from both parties have to embrace all the hot-button women’s issues or you get defeated. Removed from the political food chain.

    The end result is a plunge in fertility rates, decline in marriage and massive immigration. This is the fate of all successful societies. Question is, if you are a guy, do you just sit here out of a combination of inertia and patriotism, or move on? Certainly Washington, Jefferson and Madison and Hamilton would have been deeply disturbed by what the US has become politically.

  5. Gravatar of Adam Adam
    29. April 2015 at 11:38

    Not so sure about the “people who work with their hands” but with the death of the labor movement, it’s probably descriptive correct. Although the reasons for that support probably do not match those people’s actual economic interests.

    But yeah, the GOP doesn’t want “small” government. It just wants to make sure that someone is getting a profit out of any government spending. Once that taste is in place, they’re all for spending away.

  6. Gravatar of benjamin cole benjamin cole
    29. April 2015 at 15:23

    Your income and capital gains taxes (not FICA) are mostly consumed by the DoD, VA, DHS, debt and rural subsidies.
    How the GOP will ever be responsible fiscally, or in foreign policy, is a scary question. The Donks may be worse.

  7. Gravatar of Steve Steve
    29. April 2015 at 16:25

    “GOP represent[s]… business”

    “Dems represent…people who work with their minds”

    Some people might be offended by this choice of division.


    PS. But I’m sure Krugman would agree

    PPS. Do Libertarians work with their Hyperminds?

  8. Gravatar of Major.Freedom Major.Freedom
    29. April 2015 at 17:08

    “Government is simply a tool to further the interests of whichever group is favored or disfavored by the party in power.”

    cough…central bankers…cough

  9. Gravatar of Ray Lopez Ray Lopez
    29. April 2015 at 20:46

    Sumner is right. Republicans like Reagan and Bush II were populists rather than ideologues. That’s one reason Stockman quit Reagan’s team when he realized this. Populists cater to the masses, and deficit spending caters to the masses who want more benefits than they can pay for.

  10. Gravatar of Mikio Mikio
    30. April 2015 at 04:05

    Is there a website where the public can track your nGDP expectations?

  11. Gravatar of TallDave TallDave
    30. April 2015 at 07:27

    Minarchism runs afoul of a lot of special interests — a slight reduction in the growth of government spending is generally described by Democrats and the press (but I repeat myself) as starving widows and orphans, destroying our roads and bridges, throwing blacks back into slavery, and possibly even heralding the return of disco.

    And the government itself is worst of all. Remember when they closed the national parks and actually spent EXTRA money to erect barriers to prevent WW II veterans from visiting their own damned memorial? And the first thing the IRS cuts is customer service, because it’s the most painful to the public.

  12. Gravatar of Bill Reeves Bill Reeves
    30. April 2015 at 15:56

    Whats interesting is that there is a big difference between Rs and Ds at the state level. Contrast the fiscal chaos in CA, NY and IL with Texas or Florida for example. Virtually all of the states in the worst fiscal shape have been D dominated for decades. Even their voters recognize this: in recent years voters in fiscally troubled D Strongholds New Jersey, Massachusetts, Michigan, Wisconsin, Maryland and Illinois have elected Republican governors as ‘turnaround’ managers. And I don’t have to remind you that all of the rapidly bankrupting big cities are Democrat monocultures (and no Bloomberg was not a Republican).

  13. Gravatar of ssumner ssumner
    30. April 2015 at 19:22

    Mikio, It’s in the right column of this blog.

  14. Gravatar of Mikio Mikio
    1. May 2015 at 15:12

    Scott, yes, found it. Apologies! You should promote it more and have it show up all over the place, especially on mobile machines 🙂

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