Democratic Tweedledum Plan
by Donald Devine

“A New Direction for America,” the House Democrat plan, is a remarkable document. It is the Dems 2006 version of the old GOP “Contract with America.” What strikes the reader is that most of it is so Tweedledum it could have been lifted directly from the George W. Bush White House or Republican Party web sites.

The Democratic statement on the budget is even arguably better.

Our federal budget should be a statement of our national values. One of those values is responsibility. Democrats are committed to ending years of irresponsible budget policies that have produced historic deficits. Instead of piling trillions of dollars of debt onto our children and grandchildren, we will restore “Pay As You Go” budget discipline.

Congress under Republican control has turned a projected $5.6 trillion 10-year surplus at the end of the Clinton years into a nearly $3 trillion deficit– including the four worst deficits in the history of America. The nation’s debt ceiling has been raised four times in just five years to more than $8.9 trillion. Nearly half of our nation’s record debt is owned by foreign countries including China and Japan.

We are committed to auditing the books and subjecting every facet of federal spending to tough budget discipline and accountability, forcing the Congress to choose a new direction and the right priorities for all Americans.

It is incredible that the Democrats ran to the right of the Republicans on fiscal responsibility in the last election. “Pay as you go” probably hides a hope for tax increases but it is significant that none is listed in their plan. As far as spending, the House Democrats are correct that non-defense, non-security spending under President Bush has been almost double that under Bill Clinton, with the largest percentage increases since Lyndon Johnson and Franklin Roosevelt. Entitlement spending exploded, including the first new program since the Great Society, the Medicare prescription drug plan. That one program increased red ink by one hundred and fifty percent the total unfunded obligation of Social Security.

The Democrats even promise to reform this drug plan to reduce its costs. They proposed to do so by allowing Medicare officials to “negotiate” drug prices with pharmaceutical companies and Medicare drug plans. Of course, they are really proposing not negotiation but government-dictated lower prices that are disguised price controls that will ultimately lead to drug shortages and rationing as they have in the foreign countries that have adopted them. The Democrats did not propose a rational solution but they at least grasp that the costs are unsustainable over time. By contrast, Republicans planned to stay the untenable entitlement course they themselves greatly worsened during their years of Congressional control.

Speaker-designate Nancy Pelosi and her pals’ solution for health care is to “provide universal, affordable access to health insurance, beginning with a 50 percent tax credit and multi-insurer pools to help small businesses provide affordable and comprehensive health care coverage for their employees.” While “beginning with” should be cautionary, credits are at least part of the solution favored by many conservative think tanks. Of course, Social Security is untouchable but it is for Republicans too. The Democrats do propose private supplemental retirement programs as in “existing retirement accounts, such as 401(k)s and IRAs,” which historically have been part of the GOP solution.

While the Democrats have developed a greater appreciation for the market in their 2006 plan, they have not been able to transcend their old New Deal belief that with enough government planning the “defects” of the market can be corrected. On the other hand, neither can most Congressional Republicans these days. The Democratic solutions do sound incredibly bureaucratic. They propose:

• doubling funding for the Manufacturing Extension Partnership (MEP) and the Advanced Technology Program (ATP), modernizing the Small Business Innovation Research Program (SBIR), and fully funding SBA 7(a) loans to ensure that American small businesses have the resources and technical assistance they need to successfully innovate,
• creating an initiative to provide seed to develop high-risk, high-reward technologies and of revolutionary energy technologies, such as those nanotechnology, solar, and fuel cell research,
• creat[ing] regional Centers of Excellence for basic research that will attract the best minds and top researchers to develop far-reaching technological innovations and new industries, and modernize existing federal and academic research facilities, [and]
• Moderniz[ing] and permanently extend a globally competitive research and development (R&D) tax credit to increase domestic investment, create more U.S. jobs, and allow companies to pursue long-term projects with the certainty that the credit will not expire.

But notice that all of these have their roots either in Republican Congresses or were retained by them from Bill Clinton’s “triangulation” programs. Both parties have accepted his solution of throwing small doses of dollars at big problems to show government is “doing something” without causing too much economic harm (or doing much good). The Democrats at least propose to amend the burdensome securities requirements implemented under a Republican Congress to “require specifically-tailored guidelines for small public companies to ensure Sarbanes-Oxley requirements are not overly burdensome” on small businesses.

Sure, Democrats will do some economically irrational things, such as increasing the minimum wage, but at the end of the last Congress the GOP House passed a bill to do the same. The day after the election President Bush announced he is ready to sign on too. Democrats will offer a big “ New Direction” greatly increasing funding for college tuition, to “slash interest rates on college loans in half to 3.4% for students and to 4.25% for parents – saving the average student borrower $5,600, dramatically increase the tax deductibility of college tuition by simplifying the maze of tuition laws to allow a 100% tax credit for tuition up to $3,000 – the equivalent of a $12,000 deduction for most middle-class families, and increase the maximum Pell Grant to $5,100, giving more than a quarter of a million additional young people the opportunity to pursue a college degree.” Since Republicans adopted President Bush’s big new “no child” plan for grade schools, increasing federal education spending by 99 percent, and favored extending it to high schools, there is little reason to assume the GOP will not extend it to college also, although it is not clear either are willing to pay for it.

The only real objection President Bush would have with the House Democratic plan would be its proposal for 2006 to become a “year of significant transition” for reducing the U.S. military presence in Iraq. But the results of the election have made Republicans in Congress more open to such a proposal too. Pollster Whit Ayres has created a chart showing the correlation between dissatisfaction about Iraq and political dissatisfaction generally, and the case is overwhelming that Iraq had a great deal to do with the GOP defeat in 2006. This is also confirmed by the exit polls. The fact that President Bush’s first act after the election was to fire his defense secretary suggests he has come to a similar conclusion. The president's decision followed by only one hour Speaker Nancy Pelosi’s hint that firing Donald Rumsfeld was the way the president should signal that he is ready to deal on Iraq.

Sources: The Gallup Poll (Mar 03-Mar 06), TNS (May-Jun 06), ABC (Aug-Oct 06), and CNN (Nov 06). Source (Dissatisfaction): The Gallup Poll

The one radical change would come if Democrats actually follow through on their proposal to open up House procedures. “Bills should be developed following full hearings and open subcommittee and committee markups, with appropriate referrals to other committees. Members should have at least 24 hours to examine a bill prior to consideration at the subcommittee level. Bills should generally come to the floor under a procedure that allows open, full, and fair debate consisting of a full amendment process that grants the Minority the right to offer its alternatives, including a substitute.” Obviously, Republicans now agree. Democrats are now not so sure.

Democratic tendencies to excesses will also be controlled by public opinion. All eight state referenda against government use of eminent domain to take private property for public use were adopted. Seven of eight state referenda defining marriage as between one man and one woman passed. The Michigan referendum against racial preferences passed. Some environmental and minimum wage and one stem cell proposal were adopted but they do not change the basic reality of a basically conservative electorate that is suspicious of big government, as demonstrated by a McLoughlin poll.

Indeed, the major strategists of Democratic victory, Representative Rahm Emanuel and Senator Chuck Schumer, both recognized that conservative candidates were essential to create their new majority. Emanuel recruited a dozen social conservatives, including former football star, Heath Shuler in North Carolina. Supporting former Reagan Navy secretary and war hero James Webb in the primary against a popular liberal was essential to winning the Senate and demonstrates how the Democrats will be constrained in the upper house too.

One must conclude that things will not be much different under Democratic Congressional control. In his first post-election news conference, President Bush signaled he will cooperate with the other party, a system he was comfortable with when he was governor of Texas. He will try to trade giving Congress more control of domestic matters in return for his retaining foreign and defense authority. Even here, cross-party interests coincide since the Democrats will want the president to be perceived as in charge of Iraq, Afghanistan and the rest in the hopes he and his party will get any blame in 2008.

Even if Democrats achieve all they promise in “New Direction,” it will look pretty much like it has under the last three presidents. The Tweedledee and Tweedledum pragmatic progressives controlling both parties will continue to play their political games as the country comes closer and closer to the bankruptcy of entitlements that threatens the very well-being and even security of the nation. Since not much will change for the next two years, conservatives have the luxury to look beyond short-term gamesmanship and prepare for the real problems the country will face after the 2008 election.

Donald Devine, the editor of Conservative Battleline Online, was the director of the U.S. Office of Personnel Management from 1981 to 1985 and is the director of the Federalist Leadership Center at Bellevue University.