The passage of “Cut, Cap and Balance” in the House of Representatives is a game-changer. It is also the ground on which the GOP must stand, fight and win, especially now that a July 18-21 CNN poll shows that two-thirds of Americans support the House’s approach.
Cut, Cap and Balance allows the debt limit to increase by $2.4 trillion, but only after an equivalent amount in spending cuts are agreed to. That’s a pretty “balanced approach” by any reasonable standard, especially when you consider that the envisioned cuts are barely over half the debt Obama has run up since 2009. But it also requires congressional passage of a balanced-budget amendment, of the sort that helps 49 states stay out of Washington’s kind of trouble, before the debt ceiling may be raised.
To Obama and the Democrats, this is extremism. “Moderation” is the “Gang of Six” alternative that raises taxes by over $1.2 trillion — in the midst of a high-unemployment recession — and makes nebulous promises of future cuts.
To the media, the “Gang of Six” must be listened to, while the “Gang of 234” in the House is a bunch of children to be chided. But the Constitution disagrees, and so should Republicans. Here are seven reasons why House Republicans must stand firm.
1. The Republican Party will come apart at the seams if they don’t. And everyone in the media, the Democratic Caucus and the White House knows this perfectly well. That’s the idea.
The 2010 election was the biggest blowout for one side in the House of Representatives in modern history, and unified virtually all Republicans with two-thirds of independents. Yet after a decade of out-of-control spending and big government, it was also a grudging “last chance” for the GOP, prompted only by the greater disaster of Obama.
If Republicans vote for tax hikes now, their party — and the massive non-partisan coalition that swept it to power just months ago — will be rent asunder, just as Barack Obama is hoping it will. In today’s climate of hyper-partisan volatility, that might spell its death. But it will certainly spell Obama’s thumping re-election and the consolidation of the leftist agenda in America.
2. Obama’s promised cuts can’t be trusted: Part one (1983). We’ve been here before. In 1983, Democrat House Speaker Tip O’Neill offered this same deal to Ronald Reagan: $3 in spending cuts for every $1 in tax hikes, “a balanced approach.” Reagan bought it and rued the day, because O’Neill and the Democrats flat-out lied: For every $1 in tax hikes, they actually raised spending $1.82.
3. Obama’s promised cuts can’t be trusted: Part two (1990). In fact, this worked so well that when George H.W. Bush made his famous “Read My Lips: No New Taxes” pledge the cornerstone of his campaign and presidency (much as Tea Party Republicans have now done), Democrats began salivating at the opportunity to destroy him.
So in the fall of 1990, Republican “moderate” and Bush OMB director Dick Darman worked out a “grand compromise” with congressional Democrats: $2 in spending cuts for every $1 in tax hikes. And despite his grand promise, Bush bought it too, never imagining it for the set-up it oh-so-obviously was.
And as before, the tax hikes became law immediately, the spending cuts never materialized and, in fact, spending spiraled upward. Bush lost 20 points in the polls immediately, was briefly buoyed by the Persian Gulf War and then watched his presidency dissolve before his eyes.
4. Obama’s “plan” is to raise taxes by over $1 trillion in a recession. No school of economic thought believes this is a good idea. The father of liberal economics, John Maynard Keynes, taught precisely the opposite. Why? Because the increased taxes will necessarily increase unemployment, while bringing in significantly less than the president’s promised revenues. It’s like the ancient Hebrews being told to make bricks without straw.
If Republicans want to join Obama in shared responsibility for massive debt, job-killing taxes and double-digit unemployment next November, signing onto his plan is the way to do it.
5. Caving to Obama means a permanent higher baseline for spending. Before Obama, the all-time record deficit was $483 billion; the modern average was around $200 billion. Now we throw around “trillion” without a thought, something ACORN founder Saul Alinsky expressly instructed his disciples, like Barack Obama, to do: Speak in numbers so vast that the average person can’t grasp them. And indeed it is very hard to grasp that nearly one-third of the entire national debt since the beginning of the Republic 235 years ago has been added in Obama’s first two years.
Can you name a single thing you have to show for it?
It’s crazy to suggest none of this $4 trillion in brand new spending can be cut, yet that’s the Democrats’ position: that cuts of even a few billion would leave little old ladies starving in the street (we all remember the streets filled with starving retirees in the years before The Great Obama). In other words, this is the new normal, get used to it. And if Republicans accept that irrational intransigence, America will be Greece within a decade.
6. The “threat” of default is pure fear-mongering. The Democrats want us to forget the more than $2 trillion in tax revenues the federal government already takes in. That’s more than enough to cover all interest payments and entitlements, the military and even a good bit of the pre-Obama level of discretionary spending. Any default would be Obama’s fault.
7. Obama has nowhere to go. For all the talk of the “extremists” in the House “having to come to terms” with Obama, the precise opposite is true: No bill that involves spending or taxes can be enacted without the House. Period.
The media will relentlessly remind us that Gingrich’s Republicans “lost” the government shutdown fight with Clinton. But what do they mean by “lose”? The media certainly tarred and feathered the Republicans, and the Republicans certainly caved in the end. But did they lose an election over it? No, Bob Dole managed that all by himself. And did Clinton magically pass a budget from the White House. No, and Barack Obama can’t either.
The overwhelming majority in the House only looks “extreme” and the president’s intransigence and deceit only looks “moderate” when viewed through the lens of the in-the-tank-for-Obama media. And that same media will give Republicans zero credit for a “grand compromise”: It will pummel them to death for their hypocrisy in breaking their no-tax pledge, while (correctly) claiming they are equally to blame for Obama’s economic quagmire. Its advice must be ignored, as it was so successfully in 2010.
As is always the case when courage is called for, victory cannot be guaranteed. But abandoning courage will assure defeat. And that defeat will not end with a tax hike in 2011. It will end with a 1992-, 2006- and 2008-like dismemberment in 2012, as Republicans’ last-chance coalition rises in revolt. And since that coalition was a shockingly huge majority in 2010 — much like the two-thirds of Americans who support Cut, Cap and Balance today — it stands to reason that if Obama is defeated here, he’ll have no good place to go a year from now.
Republicans must stand. Here. Now.
Rod D. Martin, founder of The Vanguard Project, is a leading futurist, technology entrepreneur and conservative activist from Destin, Florida. He was part of PayPal.com’s pre-IPO startup team, serving as special counsel to founder and CEO Peter Thiel, and also served as policy director to former Governor Mike Huckabee. He is President of the National Federation of Republican Assemblies (NFRA), a member of the Council for National Policy, and serves on numerous nonprofit and for-profit boards.