Speaker Boehner's Economic Illiteracy Is A Feature, Not A Bug
House Speaker John Boehner's (R-OH) May 9 speech to the Economic Club of New York was greeted with a brief flurry of pieces debunking his false claims: Bloomberg, the Washington Post's Ruth Marcus and The New Republic's Jonathan Chait, among others, took the time to correct several of the speaker's falsehoods. The Washington Monthly's Steve Benen cut to the chase, declaring Boehner "functionally illiterate on economic policy."
But it's important to understand that Boehner's know-nothingism is a feature, not a bug: Republicans didn't choose an economically illiterate Speaker of the House by accident, and they aren't embarrassed by him. Instead, Boehner's rapid-fire foolishness represents a decades-long embrace by the Republican Party and the conservative movement of economic positions that have a purely adversarial relationship with reality — but that, conveniently enough, benefit the super-wealthy and large corporations at the expense of the other 98 percent of the country.
Bloomberg identified several Boehner "assertions that are contradicted by market indicators and government reports": the claim that government spending is "crowding out private investment," that the 2009 economic stimulus package "hurt job creation," that the Republican plan to privatize Medicare will give future retirees the "same kinds of options" members of Congress have, and that a 1990 tax increase led to a recession and the economy didn't pick up until the end of the decade. All of those claims, as Bloomberg explained, are false. But they're also key components of the Republican economic mantra.
Bloomberg explained that "Boehner's statement ... that government spending 'is crowding out private investment and threatening the availability of capital' runs counter to the behavior of credit markets." Bloomberg noted that former Fed Chairman Alan Greenspan and former Bush Treasury official John Taylor have made similar claims. But the assertion that government spending is "crowding out private investment" is common among Republicans.
Here's Rep. Paul Ryan (R-WI), the House Budget Committee chair and supposedly a brave and serious thinker, in his "Path to Prosperity" budget: "Borrowing and spending by the public sector will crowd out investment and growth in the private sector." During a March 2 appearance on CNBC, Ryan insisted: "Forty-two percent of our budget is borrowed money. It is crowding out private sector capital." And according to The Economist, the theory that "government deficits were crowding out private investment" is a "key assumption" of the Heritage Foundation analysis Ryan used in his budget. (In May 2009, Heritage insisted "now the vaunted 'crowding out' effect from government borrowing is almost a certainty, as are the resulting higher interest rates.")
Sen. Jeff Sessions (AL), the ranking Republican on the Senate Budget Committee, sought a spending freeze in April 2009, worrying that the recently passed stimulus and the proposed 2010 budget would likely yield a "short-term economic benefit" but "the future debt burden will crowd out private borrowing, drive up interest rates, and likely cause a rise in inflation."
So Boehner isn't alone in claiming that government spending is crowding out private investment: He's joined by the top Republicans on the House and Senate Budget Committees, and the most prestigious conservative think tank.
Bloomberg also debunked Boehner's claim that the 2009 economic stimulus package hurt job creation, explaining that this is "at odds with the Congressional Budget Office's findings last August. The stimulus package increased the number of people employed by between 1.4 million and 3.3 million and cut unemployment by between 0.7 percentage point and 1.8 percentage point, according to CBO."
But, again, this false claim is common among Republicans. Paul Ryan has falsely claimed the stimulus "failed to deliver on its promise to create jobs." (That's no surprise: Ryan opposed the stimulus before it happened and called for its repeal in December 2009, claiming it "hasn't create[d] the jobs," though he did seek stimulus funds for his district.) Sen. Scott Brown (R-MA) has claimed the stimulus "didn't create one new job." House Majority Leader Eric Cantor (R-VA), Florida Gov. Rick Scott, the Republican National Committee, and countless other Republicans have likewise ignored the CBO's findings in claiming that the stimulus failed to create jobs.
Bloomberg also took Boehner to task for claiming the "Republican plan to privatize Medicare will give future recipients the 'same kinds of options' lawmakers have." Bloomberg explained that according to the CBO, "under the Republican plan, by 2030 the government would pay 32 percent of the health-care costs of a typical 65-year-old. The U.S. Office of Personnel Management's benefit handbook says the government pays as much as 75 percent of the health-care costs of federal workers, including members of Congress."
Bloomberg noted that, contrary to Boehner's claims that the 1990 tax increase caused "the recession of the early 1990s" and "it wasn't until the economy picked back up toward the end of that decade that we achieved a balanced budget," the economy in fact picked up in the early 1990s — despite the 1993 increase of the top marginal tax rate. (And the Washington Post's Ruth Marcus pointed out that the 1990 budget deal could not have caused the early-1990s recession, which began "two months before the agreement was reached.")
TNR's Jonathan Chait debunked Boehner's claim that "Washington doesn't have a revenue problem. Washington has a spending problem," which is complete nonsense. Chait also highlighted Boehner's claim that the Bush tax cuts created 8 million jobs in 8 years, noting that even that incredibly generous accounting (which does not factor in any of the job losses that began during the latter years of the Bush administration) is quite unimpressive in comparison to the 23 million new jobs created during the Clinton administration, when tax rates were higher.
The claim that "Washington doesn't have a revenue problem" is a common Republican slogan. Here's Ryan: "If you look at the deficit, the problem is spending, not taxes." Cantor: "Washington does not have a revenue problem. It's got a spending problem." Sen. Orrin Hatch (R-UT): "We don't have a revenue problem. We all know we have a spending problem." House Ways & Means Committee Chairman Dave Camp (R-MI): "It's a spending problem, not a revenue problem." Senate Minority Leader Mitch McConnell (R-KY): "Let's just admit we don't have a revenue problem. We have a spending problem." Reps. Joe Walsh (R-IL), Chuck Fleischmann (R-TN) and Todd Rokita (R-IN), too. And countless others.
You may have noticed that Paul Ryan has made many, if not all, of the demonstrably false claims Boehner got in trouble for. Ryan, of course, is currently the GOP's smart/serious/wonky economic expert — or so Republicans and the media keep telling us. Yet he doesn't seem to have the first clue what he's talking about.
Ryan's predecessor in the "budget wunderkind" role was John Kasich, who chaired the budget committee after the GOP took over the House in 1995 and now serves as governor of Ohio. Kasich had a track record of spectacular wrongness, too. Before Kasich, there was former Rep. Jack Kemp (R-NY), lauded for an "intellect [that] seem[ed] to reflect a dogged fascination with ideas" despite (or perhaps because of) his fondness for supply-side alchemy.
See the trend? It's that Republicans, including (and perhaps especially) the very Republicans who have a reputation for being serious economic thinkers, tend to make economic claims that are demonstrably false. They either don't know what they're talking about, or knowingly lie. There's a decades-long trail of evidence.
To his credit, Chait makes clear that Boehner's economic fantasies are not unique: "Dishonesty of some form or another is common in politics, but Republican economic policymaking is characterized by massive, systematic dishonesty or rank ignorance that permeates every element of the process, from intellectual entrepreneurs to elected officials." And Ruth Marcus stipulated: "Boehner's economic comments were nothing particularly new. Indeed, they reflect what has become the mainstream thinking of the Republican Party. But that's exactly the point. We become so inured to hearing this thinking that we neglect to point out how wrong it is."
Despite the consistent wrongness of "the mainstream thinking of the Republican Party" on economic issues, that thinking has been enormously influential over the past few decades, in part because of the media's neglect. No, not just neglect: People like Paul Ryan, who consistently peddle easily debunked ideological fantasies, are consistently held up as serious thinkers, rather than treated like the charlatans that they are. Last week's acknowledgement of John Boehner's economic illiteracy should be the rule, not the exception.