Wednesday, January 25, 2012

A Debt He Knows Intimately

MSNBC's Andrea Mitchell remarked Tuesday

I talked to a top Romney adviser tonight who said, 'Look, if Mitt Romney can not win here in Florida then we're going to have to try to reinvent the smoke-filled room which has been democratized by all these primaries. And we're going to have try to come with someone as an alternative to Newt Gingrich who could be Jeb Bush, Mitch Daniels, someone.' Because there is such a desperation by the so-called party elites, but that's exactly what Gingrich is playing against.

That reflects the thinking of Steve Schmidt, campaign advisor for presidential nominee John McCain, who after the South Carolina primary projected "we're probably moving toward the declaration of war on Newt Gingrich by the Republican establishment. And if Newt Gingrich is able to win the Florida primary, you will see a panic and a meltdown of the Republican establishment that is beyond my ability to articulate in the English language."

Jeb Bush probably could have his arm twisted, but likely would prefer another four years for people to forget the disastrous presidency of brother George.        With Chris Christie the primary surrogate of Mitt Romney and Haley Barbour exposed as the best friend a felon ever had, there is renewed interest in the GOP establishment in Mitch Daniels.       The Indiana governor had a minor audition last night as he delivered the Repub rebuttal to the President's State of the Union address, in which we heard "in three short years, an unprecedented explosionof spending, with borrowed money, has added trillions to an already unaffodable national debt.    And yet, the President has put us on a course to make it radically worse in the years ahead."

When The New York Times' Ross Douthat in early 2010 promoted Daniels as a presidential contender, The New Yorker's George Packer recalled

Daniels was Bush’s head of the Office of Management and Budget from 2001-2003 (what happened to the surplus inherited from Bill Clinton during those years is a separate story). He was responsible for forecasting the budget in the event of a war with Iraq. His number came in at fifty to sixty billion dollars. Compared to what some experts were forecasting, it was an astonishingly low figure. But even Daniels’s projection was too much for the Bush White House, which was intent on keeping unpleasant scenarios about the war out of the public eye, and Daniels’s own spokesman, Trent Duffy, was sent out to talk the number down. Lawrence Lindsey, Bush’s top economic adviser, had said the war could cost as much as two hundred billion, and Daniels had dismissed the figure as “very, very high.” As for the cost of rebuilding Iraq, by April of 2003—with the war already under way—O.M.B. had asked Congress for the paltry sum of 2.5 billion. By the end of last year, the wars in Iraq and Afghanistan had cost over a trillion dollars.

A lot of people underestimated the consequences of that war. What worries me is that Daniels’s projection was the budgetary equivalent of the Rumsfeld Pentagon’s failure to commit enough troops for the occupation. “Very, very high” reminds me of what Paul Wolfowitz said in response to General Eric Shinseki’s estimate that stabilizing Iraq would take several hundred thousand troops: he dismissed it as “wildly off the mark.” Wolfowitz and Daniels weren’t just mistaken. They were guaranteeing that the Administration wouldn’t be ready if things went wrong. They were contributing directly to the disaster that followed the fall of Saddam. And they were acting out of ideological conviction or bureaucratic loyalty rather than cold analytical judgment. In short, when the stakes were as high as possible, Daniels showed very little independence or common sense, the qualities that Douthat credits him with.

Daniels also helped turn the large surplus handed to President Bush by President Clinton into a huge surplus.      As the chart below, from a signed editorial by Teresa Tritch of the NYT, indicates, today's deficit results far more from the wars Bush waged and his big defense budgets, the economy which tanked during Bush's second term and, especially, the tax cuts he implemented.      The 43rd President is far more responsible than is the 44th President for the national debt Republicans suddenly became concerned about 36 months ago.      The seeds of, in Daniels phrase, impending "national bankruptcy," were planted not by Barack Obama or  the "big, bossy government,"  the which he considered far less "bossy" when it was supplying the Indiana governor with the stimulus funds that allowed him to balance state government.        Some of those seeds were planted by Mitch Daniels and thereafter continually watered by the president whose critical contribution to economic disaster he ignores.

Criticize, even condemn President Obama who, after all, extended the Bush tax cuts which helped drive deficits and the national debt.     But doing so with the guy who applauded the policies is shameless- or would be if his party had any sense of shame.

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