Tea Party Tory
by: Pat Buchanan
Before the Tea Party philosophy is ever even tested in
America, it will have succeeded, or it will have failed,
in Great Britain.
For in David Cameron the Brits have a prime minister who
can fairly be described as a Tea Party Tory. Casting aside
the guidance of Lord Keynes -- government-induced deficits
are the right remedy for recessions -- Cameron has bet his
own and his party's future on the new austerity. He is
making Maggie Thatcher look like Tip O'Neill.
Two headlines Thursday testify that the Tories have seized
the Tea Party banner. First was the headline in The
Washington Times, "Tea Party Urges Drastic Cutting," that
carried a caveat subhead, "Economists Question If Move Is
Wise at This Time."
Second was the Financial Times banner, "UK Unveils Dramatic
Austerity Cutbacks." The FT story begins, "The U.K.'s
conservative-led coalition has announced the most drastic
budget cuts in living memory...
"The sweeping cuts in entitlements and spending far exceed
anything contemplated in the U.S., where Barack Obama...
has proposed only a three-year freeze on discretionary
spending and Congress is still debating whether to extend
tax cuts for the wealthy."
The Tory budget cuts defense 8 percent and military
personnel by 7,000. Translated here, that would mean a
cut of $60 billion and about 100,000 soldiers, sailors,
airmen and Marines.
By 2015, some 490,000 public-sector employees, 8 percent
of the total, will lose their jobs. The rest will have
their wages frozen for two years and face a 3-percent-of-
salary hike in compulsory contributions to their pension
program. The retirement age will rise from 65 to 66.
France is in the 10th day of demonstrations, strikes and
riots over President Sarkozy's plan to raise the retirement
age to 62.
If Cameron's plans take effect and his projections prove
correct, Britain's deficit will fall from 10 percent of
gross domestic product to 2 percent.
Writes the FT, "The UK cuts ... over four years are the
equivalent of 4.5 percent of projected 2014-2015 gross
domestic product. Similar cuts in the U.S. would require
a cut in public spending of about $650 billion."
Nothing like that is being discussed here, and even if
Republicans capture the House, cuts of that magnitude
appear out of the question. The correlation of forces
would not permit it.
Consider what seems the best possible outcome, Nov. 2, for
the Tea Party. Republicans capture the House by winning
50 seats and come within a vote or two of capturing the
Should that happen, Democrats, shorn of their centrist
wing in the massacre, will be in no mood to cooperate in
cutting Social Security, Medicare, Medicare, unemployment
insurance, food stamps or the earned income tax credit,
the party's legacy to the nation.
They will vote against serious cuts with as great a
unanimity as Republicans voted against Obamacare. And
if the GOP House votes the cuts, Senate Democrats will
restore them. And if President Obama thinks they are too
severe, he will veto the budget, his veto will stand,
and he will run against "Boehner's House" in 2012.
And Obama would do so with conviction. For neither he nor
Fed chair Ben Bernanke agree with Cameron that Carthusian
austerity is the way to go. They are Keynesians who think
that is Hooverism.
Both believe the $1.4 and $1.3 trillion deficits they just
ran up prevented the Great Recession from becoming a Great
Recall. Obama endorsed George W. Bush's TARP bailout of
the banks. He enacted a $789 billion stimulus bill, pushing
the deficit to 10 percent of GDP. Bernanke doubled the
money supply. He has now embraced "quantitative easing."
He is going to print billions to buy bonds and inject the
money directly into the economy.
Quantitative easing is another bailout of the banks, only
this time through the Fed back door.
Hence, the Tea Party faces almost certain disappointment,
if not disillusionment.
Why? Because many in the Republican establishment also do
not believe austerity is the way to go in a recession.
Second, while most Republicans may favor deep cuts, they
know that if they vote to cut Social Security, Medicare
and unemployment insurance, but do not get those cuts,
they will get the pain but not the benefit and be held
accountable, just as Democrats were held accountable
for cap-and-trade, which they voted for but did not get
through the Senate.
Republicans will come out of this election with a tricky
hand to play. They will have the appearance of power, but
not the actuality. They will vote for cuts that will not
be agreed to by the Senate or accepted by the president.
If the economy is in the ditch in 2012, they will seem
ineffectual. If the economy is improving, Obama and
Bernanke will claim credit.
By then, however, we will know the fate of the Tea Party
Tory who will at least have seen his policy prescriptions
put to the test.