Big Government Republicans

In labeling Democrats as the “party of big government,” Republicans may have pulled off the most audacious public relations coup since Austria persuaded the world that Hitler was a German.

When President Bush took office, the government was running a budget surplus and was on its way to paying off the national debt. Tax cuts, war in Iraq, the biggest new health program since the 1960s, a Wall Street bailout and a raft of spending increases wiped away the surpluses, creating a $400 billion deficit by Bush’s last year in office.

Yet Republicans, adopting a Who, me? approach, have managed to convince an increasingly angry populist uprising that it was Democrats who got us here.

President Obama’s policies certainly deserve scrutiny. The Heritage Foundation’s Brian Riedl figures Obama’s stimulus program, proposed health legislation, and other initiatives would add trillions more to the public debt.

But if the Tea Party movement believes the GOP is the champion of fiscal restraint, it is ignoring the history of the last decade.

In retrospect, it is clear that the Sept. 29, 2008 House vote rejecting the $700 billion bailout of Wall Street marked a political turning point — a new grassroots politics — that culminated in last week’s stunning upset of the Democratic candidate in Massachusetts Senate race.

Republicans have brilliantly succeeded in hanging the bailout albatross around the neck of Obama. What has largely been forgotten is that a third of House Republicans and virtually all the party leadership favored the bailout and fought for a second vote that would, finally, approve the controversial $700 billion Troubled Asset Relief Program (TARP).

It was Treasury Secretary Hank Paulson who (literally) got down on his knees at the White House and begged House Speaker Nancy Pelosi (D-Calif.) to try again.

Paulson was backed by Minority Leader John Boehner, who said on the House floor: “If I didn’t think we were on the brink of an economic disaster, it would be the easiest thing to say no to this.”

Rep. Spencer Bachus (R-Ala.), top Republican on the House Financial Services Committee, put it even more bluntly: “There are no other choices. No alternatives.”

Republican support for TARP was in tune with eight years of profligate GOP spending.

Earmarks for home-state projects exploded. War and the expansion of the American military might into Eastern Europe and the Middle East doubled the Pentagon’s budget.

Bush-era Republicans scrapped “paygo,” a budget device adopted earlier with strong Democratic support, that required new spending to be offset either by spending cuts elsewhere or with new taxes. That enabled the GOP to push through a new Medicare prescription benefit for 41 million Americans without one nickel of the costs being offset elsewhere in the budget.

By contrast, Republicans have hounded Democrats for the cost of health care legislation that would, at least on paper, be paid for with spending trims and new revenues.

(Democrats restored paygo after taking back the House and Senate in the 2006 mid-term elections, forcing a measure of fiscal restraint on themselves.)

That is all largely forgotten now. Republicans have skillfully exploited populist rage while Democrats have reaped the political whirlwind. After sweeping to power the Obama administration forgot all about the stunning Sept. 29, 2008, House vote, the first harbinger of the coming populist wave.

Instead of making reform of Wall Street his signature issue — a move that might have given him cover with independents who are now in firm control of U.S. elections — Obama turned to health care.

Democrats should not be surprised by the political turn of events. American voters have short memory spans.

Dan Morgan

January 29, 2010