A Washington Post editorial today gives Al Gore a rough slap ("Negative Al Gore"). Predictably, I guess, the Post is the repository of this city's most easy-thinking conventional wisdom. In a rebuke to the former vice-president's attack on White House economic policy the Post writes ...
President Bush's main economic policy -- the large tax cut of last year -- was not responsible for any of the current damage. Indeed, given the twin shocks of 9/11 and the post-Enron stock market decline, the short-term stimulus created by the tax cuts has turned out to be fortuitously well timed. To be sure, parts of the tax cut that have yet to be implemented, especially the repeal of the estate tax, are unaffordable and ought to be repealed.Mickey Kaus chimed in with "WaPo acknowledges what Krugman won't about the Bush tax cuts."
But does the Post's remark even make logical, let alone substantive, sense? The Post begins by saying that the Bush tax cut -- which must be what they mean by his "main economic policy" -- is not responsible for any of our current economic situation, by which they mean, in large part, the rapidly ballooning federal deficit.
With respect to the deficit, this is largely true. This year's deficit is caused to only a fairly limited degree by 9/11 or (as opposed to the deficits for the rest of the decade) the Bush tax cut. The culprit is a flagging economy and what one must imagine is a virtual surcease in the fat capital gains tax revenues which floated the federal budget through the end of the last decade.
So far so good.
But then the Post says that "the short-term stimulus created by the tax cuts has turned out to be fortuitously well timed." This makes no sense. Very little of the tax cut has even been implemented yet. That's why the White House -- and the Washington Post -- can accurately say that the administration is not responsible for this year's deficit. Is the Post talking about the stimulus which Republican flacks sometimes claim comes from the expectation of future tax cuts?
It's true that some of the tax cuts have kicked in -- largely the middle-class rebate checks foisted on the president by Senate Democrats, which are rather small. But, in any case, one can either have real stimulus, which might get some credit for buoying the economy, and also ballooning the deficit. Or one can have neither. The Post picks and chooses to sustain the logic of their editorial.
It's an example of the crying sin of much recent political journalism and commentary -- not bias of the right or the left, but reflexive special-pleading on behalf of the Bush White House.