Article by: STEVEN RATTNER , New York Times
Updated: August 16, 2011 - 11:38 AM
In the middle of all the debt default drama and stock market turbulence, the leading Republican presidential candidates have begun to fill in the shadowy outlines of their positions on major economic issues.
And what a picture it is, a philosophy oriented around shrinking the role of the federal government in every imaginable way, by slashing spending, cutting taxes and halting or rescinding regulations.
Their mantra is repeal and retrenchment, devoid of new initiatives or a positive agenda.
Some of these views are to the right even of the Tea Party; they amount to the most radically conservative positions of any set of candidates at least since Barry M. Goldwater in 1964.
Take the agreement to avert a disastrous default by cutting at least $2.1 trillion from the deficit over the next decade. Mitt Romney, Michele Bachmann and Ron Paul all opposed it.
Only Jon M. Huntsman Jr. (whose poll numbers — perhaps not coincidentally — are in the single digits) supported it. In contrast, 58 percent of the members of the Tea Party in the House ultimately cast yes votes.
Not to be outdone, Bachmann and Paul ventured still further, insisting that they would never vote to raise the debt ceiling. That may sound good on the Iowa campaign trail, but it would easily tip the economy into an unending downward spiral.
Then there's "cut, cap and balance," the Tea Party-backed bill that the House passed in the midst of the debt ceiling showdown. It would have forced the elimination of a quarter of government spending, down to a share of the economy last reached in 1966.
The measure would also have initiated amending the Constitution to require a balanced budget, which would impede our ability to manage economic cycles. Yes, Ronald Reagan also favored a balanced budget amendment — while supporting raising the debt ceiling 17 times.
Another recent legislative proposal that won support among the hopefuls — an alternative budget proposal from Rep. Paul D. Ryan, Republican of Wisconsin — would have turned Medicare into a voucher program, shifting the bulk of the cost to the elderly.
But these are only the best-known of this crowd's extreme views.
In an unpublished interview, Gov. Rick Perry of Texas told Fortune magazine that if he had been president in 2008, he wouldn't have engaged in the financial rescue effort. Without the bailout, initiated by the Bush administration, we would not have a functioning economy today.
Perry also wants to repeal the 16th Amendment, thereby eliminating the income tax, which accounts for 80 percent of government revenue. Like his fellow aspirants, Perry has offered no analysis to explain how the government would function under his vision.
Paul, who finished second in the Iowa straw poll on Saturday, has for decades sought to abolish the Federal Reserve, arguing that it is corrupt and unconstitutional. Eliminating our central bank is a crazy idea that would plunge the country back into an oscillating 19th-century world of panics and busts.
Bachmann's victory in the Iowa straw poll has only encouraged her extremism. In interviews over the weekend, she proclaimed her opposition to extending unemployment insurance for the jobless and her support for repealing both the Obama health care plan and the Dodd-Frank financial reform law.
And she said that Citigroup and General Motors should have been allowed to go bankrupt without government help. (Even The Wall Street Journal's editorial page appears unnerved; it called Monday for "a candidate who can appeal across the party's disparate factions.")
The candidates' extreme views on economic policies reinforce the broad perception that American politics have become more polarized. Keith T. Poole, a political scientist at the University of California, San Diego, found that ideological divergence in Congress was the highest in at least 120 years.
Interestingly, he concluded that the increased polarization resulted mostly from Republicans' moving to the right, a conclusion that dovetails with the fact that Obama remains basically centrist even as his would-be opponents vie to outdo each other in their extreme form of conservatism.
Perhaps these Republican aspirants are simply pandering to anti-government sentiment and, if elected, would govern more sensibly.
Franklin D. Roosevelt campaigned on eliminating "unnecessary functions of government" and then vastly expanded federal spending to fight the Depression.
Bill Clinton did the reverse, pledging tax cuts in response to the 1990-1 recession but governing as a fiscal moderate. If any of these Republicans is elected, we can only hope that they will follow this pattern.
Meantime, we have a lot to worry about.