Zonie readers will have to forgive me. I've reached a point where Arizona's cruelty, narrow-mindedness, magical thinking and self-destructive policies are ... boring. I promise to snap out of this fugue state next week.
John Boehner already is measuring new draperies for the speaker's office and Republicans seem confident of at least retaking the House, if not the whole enchilada in 2010 and then 2012. Their policy prescriptions haven't changed: military adventurism, deregulation, slashing and blocking important domestic investments — now justified by the deficit they ran up — and, especially, tax cuts. Nothing is more Reaganesque than cutting taxes.
According to Republicans, this accomplishes two goods: It raises more tax revenue for the government because it lures capital from shelters into productive uses, and, it encourages more capital formation that creates jobs. Everybody wins. George H.W. Bush derided the first part as "voodoo economics" and Paul Krugman wrote a most convincing takedown in 2003. Even so, tax cutting has been American governing orthodoxy for 30 years. Just the possibility of letting the George W. Bush tax cuts expire or returning to the estate tax that has been in place for nearly a century provokes apoplexy.
The second part of the tax-cut argument had more resonance. Even I once believed that if you really wanted to stick it to the rich, reduce their rates enough to make it impossible for them not to want to invest. Some of that is bad history, of course. The American economy did very well with Eisenhower's 90-percent range top bracket for the wealthiest, and the greatest boom of the 20th century and first surpluses in decades came after Bill Clinton slightly raised taxes. But the final blow to the tax-cut argument came under George W. Bush, as taxes were slashed on the rich, major corporations got away with paying no taxes and the estate tax was whittled to nothing. Yet the Bush years saw a net gain of a mere 1 million jobs, wages stagnated and income inequality hit levels not seen since at least the 1920s. What went wrong?