Thursday, March 3, 2011

Karl Rove Sends Out Marching Orders to Republicans

Huh, some Republicans must be getting carried away with the cut government down to size mantra. Scott Walker and other Republicans just got marching orders from the grand manipulator, Karl Rove.  In today's WSJ, Rove writes to Republicans that they can't win with just a message of austerity.

Rove tells Republicans:
... dangers lurk for Republicans. If they focus only on austerity and neglect to offer a pro-growth message, their attempt to tame the budget will be of limited appeal and could prove to be their undoing.
In actuality, danger would lurk for the elitists of every stripe, Republican or Democrat, if austerity was the only thing on the agenda. This, of course, is not what the elitists want. For them, government needs to be in the middle of everything. You can't just leave things to the free market. Here's Rove:
Americans today want to know what steps Republicans will take to create more jobs, bigger paychecks and greater prosperity.
Since the only thing government can do to "help" create jobs, bigger paychecks and greater prosperity, is to get the hell out of the way,  whatever Rove wants to do here, it is not going to grow anybody's bank account except that of the insiders.

And don't think for a minute that Republicans will read Rove's message here and decide that Rove is talking about getting government out of the way. Rove leaves enough clues to direct the conversation toward a hidden growing government. He doesn't mention the idea of etting government out of the way even once in his entire column.. What he does do is talk about is a new tax plan:
A good starting point for the GOP would be to outline a comprehensive tax reform that scrapes preferences out of the tax code and makes it simpler, flatter and fairer.
Notice, there is nothing here about cutting taxes, just the same tired rebalancing and shifting of the tax burden, which would keep lobbyists employed by special interests who will seek to gain a tax break for themselves. When you hear a call for "simpler, flatter and fairer" taxes, think more screwing of the average man.

In the column, Rove trots out Ronald Reagan, the hero of every free market speaking but interventionist acting Republican elitist on the planet. Rove says:
The political genius of Ronald Reagan is that in 1980 he added a pro-growth emphasis (supply-side economics) to his economic message.
Murray Rothbard explained what Reagan's pro-growth, cut government down to size, cut taxes program really turned out to be:
There was no "Reagan Revolution." Any "revolution" in the direction of liberty (in Ronnie’s words "to get government off our backs") would reduce the total level of government spending. And that means reduce in absolute terms, not as proportion of the gross national product, or corrected for inflation, or anything else. There is no divine commandment that the federal government must always be at least as great a proportion of the national product as it was in 1980. If the government was a monstrous swollen Leviathan in 1980, as libertarians were surely convinced, as the inchoate American masses were apparently convinced and as Reagan and his cadre claimed to believe, then cutting government spending was in order. At the very least, federal government spending should have been frozen, in absolute terms, so that the rest of the economy would be allowed to grow in contrast. Instead, Ronald Reagan cut nothing, even in the heady first year, 1981.

At first, the only "cut" was in Carter’s last-minute loony-tunes estimates for the future. But in a few short years, Reagan’s spending surpassed even Carter’s irresponsible estimates. Instead, Reagan not only increased government spending by an enormous amount – so enormous that it would take a 40 percent cut to bring us back to Carter’s wild spending totals of 1980 – he even substantially increased the percentage of government spending to GNP. That’s a "revolution"?

The much-heralded 1981 tax cut was more than offset by two tax increases that year. One was "bracket creep," by which just inflation wafted people into higher tax brackets, so that with the same real income (in terms of purchasing power) people found themselves paying a higher proportion of their income in taxes, even though the official tax rate went down. The other was the usual whopping increase in Social Security taxes which, however, don’t count, in the perverse semantics of our time, as "taxes"; they are only "insurance premiums." In the ensuing years the Reagan Administration has constantly raised taxes – to punish us for the fake tax cut of 1981 – beginning in 1982 with the largest single tax increase in American history, costing taxpayers $100 billion.

Creative semantics is the way in which Ronnie was able to keep his pledge never to raise taxes while raising them all the time. Reagan’s handlers, as we have seen, annoyed by the stubborn old coot’s sticking to "no new taxes," finessed the old boy by simply calling the phenomenon by a different name. If the Gipper was addled enough to fall for this trick, so did the American masses – and a large chuck of libertarians and self-proclaimed free-market economists as well! "Let’s close another loophole, Mr. President." "We-e-ell, OK, then, so long as we’re not raising taxes." (Definition of loophole: Any and all money the other guy has earned and that hasn’t been taxed away yet. Your money, of course, has been fairly earned, and shouldn’t be taxed further.)

Income tax rates in the upper brackets have come down. But the odious bipartisan "loophole closing" of the Tax Reform Act of 1986 – an act engineered by our Jacobin egalitarian "free market" economists in the name of "fairness" – raised instead of lowered the income tax paid by most upper-income people. Again: what one hand of government giveth, the other taketh away, and then some. Thus, President-elect Bush has just abandoned his worthy plan to cut the capital gains tax in half, because it would violate the beloved tax fairness instituted by the bipartisan Reganite 1986 "reform."
The bottom line is that tax revenues have gone up an enormous amount under the eight years of Reagan; the only positive thing we can say for them is that revenues as percentage of the gross national product are up only slightly since 1980. The result: the monstrous deficit, now apparently permanently fixed somewhere around $200 billion, and the accompanying tripling of the total federal debt in the eight blessed years of the Reagan Era. Is that what the highly touted "Reagan Revolution" amounts to, then? A tripling of the national debt?
This is the kind of "pro-growth", "fairer" tax plan that Rove has in mind. It's a combination of happy talk and free market rhetoric to increase governments role in the economy for the benefit of the insiders.

Says Rothbard:

I am convinced that the historic function of Ronald Reagan was to co-opt, eviscerate and ultimately destroy the substantial wave of anti-governmental, and quasi-libertarian, sentiment that erupted in the U.S. during the 1970s. Did he perform this task consciously? Surely too difficult a feat for a man barely compos. No, Reagan was wheeled into performing this task by his Establishment handlers.

The task of co-optation needed to be done because the 1970s, particularly 1973–75, were marked by an unusual and striking conjunction of crisis – crises that fed on each other to lead to a sudden and cumulative disillusionment with the federal government. It was this symbiosis of anti-government reaction that led me to develop my "case for libertarian optimism" during the mid-1970’s, in the expectation of a rapid escalation of libertarian influence in America...

At the same time, people began to be fed up, increasingly and vocally, with high taxes: income taxes, property taxes, sales taxes, you name it. Especially in the West, an organized tax rebel movement developed, with its own periodicals and organizations However misguided strategically, the spread of the tax rebellion signaled a growing disillusion with big government...

Surely, it is no accident that it was precisely in this glorious and sudden anti-government surge that libertarian ideas and libertarian scholarship began to spread rapidly in the United States...

The morning my first article on libertarianism appeared in the New York Times in 1971, a very bright editor at Macmillan, Tom Mandel, called me and asked me to write a book on the subject (it was to become For a New Liberty). Not a libertarian himself, Mandel told me that he believed that libertarianism would become a very important ideology in a few years – and he turned out to be right.

So libertarianism was on a roll in the 1970s. And then Something Happened...

The Reagan candidacy of 1980 was brilliantly designed to weld a coalition providing the public’s instinctive anti-government mood with sweeping, but wholly nonspecific, libertarian rhetoric, as a convenient cover for the diametrically opposite policies designed to satisfy the savvy and politically effective members of that coalition: the neocons, the Buckleyite cons, the Moral Majority, the Rockefellers, the military-industrial complex, and the various Establishment special interests always clustering at the political trough.
The anti-government feeling is again strong in the land and the establishment Republicans are going back to the old playbook. They are co-opting the anti-government mood in the country by sponsoring candidates that will draw attention from the true advocates of liberty like Ron Paul. From the Koch-sponsored Herman Cain, who speaks in generalities, to Wisconsin Governor Scott Walker, who wants to "build infrastructure for farmers" and not layoff any teachers, the Republicans have their stooges in place. And they are stooges. I find it difficult to believe anyone with a critical mind and not just simply taking orders would be able to talk to a fake Koch brother for 20 minutes, like Walker did, and not sniff out the guy was a phony, unless he wasn't doing any critical thinking at all.

And Cain did a 180-degree flip on the Fed, after obviously getting a talking to. These are just the type the elitists like to have in place. A great scene in the movie Casino Jack comes to mind. Kevin Spacey, playing the lobbyist Jack Abramoff says, when looking for a front man, and I paraphrase, "We need someone smart enough so he is presentable, but not so smart that we can't control him."

Rove knows he has the correct people in place. His column today was about making sure they stay on the elitist, establishment track, and not get too carried away with the anti-government, small government cover.


  1. Great call out of Karl Rove and his creative semantics. They're downright Krovian...