The Economist Blasts "Economically Illiterate And Disgracefully Cynical" GOP Strategy
Although The Economist endorsed President Obama's candidacy in 2008, the revered newsmagazine is not exactly a left-wing publication. Indeed, The Economist endorsed George W. Bush in 2000, citing its preference for Bush's "small government, pro-market philosophy," as well as Ronald Reagan in 1980. As such, the magazine's harsh admonishment of the Republican Party's approach to the looming default crisis is significant.
In an editorial this week, The Economist describes the GOP's unwavering objection to any revenue increases in the ongoing debt negotiations as "economically illiterate and disgracefully cynical":
The sticking-point is not on the spending side. It is because the vast majority of Republicans, driven on by the wilder-eyed members of their party and the cacophony of conservative media, are clinging to the position that not a single cent of deficit reduction must come from a higher tax take. This is economically illiterate and disgracefully cynical. [...]
This newspaper has a strong dislike of big government; we have long argued that the main way to right America's finances is through spending cuts. But you cannot get there without any tax rises. In Britain, for instance, the coalition government aims to tame its deficit with a 3:1 ratio of cuts to hikes. America's tax take is at its lowest level for decades: even Ronald Reagan raised taxes when he needed to do so.
And the closer you look, the more unprincipled the Republicans look. Earlier this year House Republicans produced a report noting that an 85%-15% split between spending cuts and tax rises was the average for successful fiscal consolidations, according to historical evidence. The White House is offering an 83%-17% split (hardly a huge distance) and a promise that none of the revenue increase will come from higher marginal rates, only from eliminating loopholes. If the Republicans were real tax reformers, they would seize this offer.
The editorial also condemns Republicans for taking "a gamble where you bet your country's good name," concluding that if America defaults, "the blame falls clearly on the Republicans."