The Right's Budget Woes

David Frum provides a useful frame:

Conservatism could once be described as a three-cornered stool: social, economic and national security conservatives. Today though it’s more relevant to think of conservatism as an attempt to draw a line connecting four points:

1) No tax increase
2) No defense cuts
3) No Medicare cuts
4) Rapid move to a balanced budget.

Obviously it’s impossible to meet all four of those commitments. It would be difficult enough to combine #4 with even two of the first three. Much of the struggle within the conservative world can be understood as a quiet debate over which of those commitments to jettison.

Put like that, the GOP is having a debate in a parallel universe. But David is dead-on. Where does Frum stand?

"I am prepared to accept tax increases provided they fall on consumption and pollution rather than work, saving and investment. A carbon tax yes, a VAT if need be, but no increases in personal or corporate income taxes or capital gains taxes. On the other hand, the 15% tax rate on corporate dividends seems to me a laughably unjustifiable giveaway, even though I personally benefit from it."

I agree with all of that. Any fiscal conservative who refuses to countenance new sources of tax revenue is not a fiscal conservative. She's a fantasist. But keeping income taxes low and much simpler, removing all those corporate tax loopholes, and focusing on taxing consumption and gas seems very sensible to me on the revenue side.

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