Pardon the slow flow of posts over the last few days, we’ll try to bump up the pace. But for the moment be sure to look at Paul Krugman’s column today in the New York Times. We’re going to be talking over the next few days about how Democrats can, and should, strike a balance between the immediate need for national unity and concerted action and committment to their own priorities and beliefs.
Partisanship, per se, really should be temporarily set aside. But it would be wrong to turn a blind eye to matters of enduring importance in the name of our current crisis — especially when the former can be shown to have little relation to the latter.
And here we have our case in point. Before last Tuesday we were already hearing some talk about a temporary cut in the capital gains tax. Then the argument was that it would scrounge together a few bucks to save the administration the embarrassment of dipping into the Social Security Trust Fund (which still matters and which we’ll be talking about). Now it’s a response to our national emergency.
This is cynical and crass on top of bad economics.
The arguments for cutting capital gains taxes as a way to stimulate growth are debatable at best. But honest supporters of this theory will freely concede that the argument only makes sense in the medium- to long-term. And plainly what the economy is in need of is short-term stimulus. In the long-term our situation is more or less exactly what it was ten days ago.
That of course doesn’t even get to the rather obvious point that there doesn’t seem to be any shortage of folks who want to cash in their investments.