Thursday, February 3, 2011

Starve the Beast: Are We Hungry Enough Yet?


Republican politicians share a singular and common goal: to starve the Beast. The beast, in case you are wondering, is ostensibly the entire federal government, but for the Republican purposes of death by starvation the definition is limited to federal programs that benefit society at large (wage-earning citizens), rather than business interests. Beast? Think education, environmental protection, health care, pensions, public transportation, consumer protection.

But leave government subsidies for defense contractors, financial firms, fossil fuel producers, pharmaceutical makers, and health insurance providers out of it, please. Republican politicians never derail the gravy train for these folks. These are the folks who put them in office, after all.

So, to put more money into the pockets of the rich people who finance their campaigns, members of the toady Republican brain trust dreamed up the brilliant initiative known as "Starve the Beast." Now, they will tell you they merely intend to cut waste and ineffective programs, but you might notice that the necessary spending cuts always take a bite out of the prosperity of poor and middle class people, not rich people. Cuts to education, environmental protection, health care, pensions, public transportation, consumer protection have little impact on the bottom lines of rich people. But they have huge impacts on poor and middle class people. (Yes, even environmental protection: without enforced laws to protect the environment, companies dump more toxins into the air and water. And where do these companies locate the offending plants? You guessed it, in poor neighborhoods. Not in the Hamptons, or Kennebunkport, I  promise.)

Here is an excerpt for Wikipedia's entry for "Starve the Beast:"
Prior to being elected as the President, then-candidate Ronald Reagan foreshadowed the strategy during the 1980 US Presidential debates, saying "John Anderson tells us that first we've got to reduce spending before we can reduce taxes. Well, if you've got a kid that's extravagant, you can lecture him all you want to about his extravagance. Or you can cut his allowance and achieve the same end much quicker."[7] It appears the earliest use of the term "starving the beast" to refer to the political-fiscal strategy was in a Wall Street Journal article in 1985 where the reporter quoted an unnamed Reagan staffer. [8]

Analysis: economic, academic, and "think tank"
Some empirical evidence shows that Starve the Beast may be counterproductive, with lower taxes actually corresponding to higher spending. An October 2007 study by Christina D. Romer and David H. Romer of the National Bureau of Economic Research found: "[...] no support for the hypothesis that tax cuts restrain government spending; indeed, [the findings] suggest that tax cuts may actually increase spending. The results also indicate that the main effect of tax cuts on the government budget is to induce subsequent legislated tax increases."[9]
William Niskanen, chairman emeritus of the libertarian Cato Institute, criticized “starve the beast.” If deficits finance 20% of government spending, then citizens perceive government services as discounted. Services that are popular at 20% off the listed price would be less popular at full price. He hypothesized that higher revenues could constrain spending, and found strong statistical support for that conjecture based on data from 1981 to 2005.[10][11] Another Cato researcher, Michael New, tested Niskanen’s model in different time periods and using a more restrictive definition of spending (non-defense discretionary spending) and arrived at a similar conclusion.[12]
It seems logical that the theory is not only mean-spirited, but self-destructive and flawed. No matter, it sounds nice in a speech: "fiscal responsibility... live within our means... pull yourself up by your bootstraps... get off the public dime... moral hazard...blah, blah, blah."

And, have you noticed that when Republicans take control of Congress, we always seem to be in the midst of a fiscal crisis imposed on us by irresponsible tax cuts initiated by a Republican president? An artificial crisis makes it easy to demand cuts to programs essential for broad prosperity and health. Otherwise, it would be difficult to overcome the uproar. But, in a crisis, "everything's on the table" right?

Just don't ask your average Republican politician or business executive to practice what he preaches. That would be mean-spirited. They have their high-end lifestyles to maintain.

This just in from your Congressional leadership: "CR Cuts Go Deep"

Stephen Schwarzman's -- Founder of Blackstone Group -- 100th Birthday Celebration
at the New York Public Library
photo: john simon daily


  1. you do realize that congress is the one in charge of spending. Look at who was majority leaders in congress for each president. then you will know the truth.

  2. Thanks for the observation. Majority leaders do not wield enough power that they can deflect every policy initiative of every president or every minority member of Congress. Reagan began starve the beast in earnest with tax cuts and increased defense spending legislation he proposed -- Congress, both venal Republicans and craven Democrats, passed it. Republicans have pushed for more tax cuts ever since. It their favorite false policy solution for every economic problem.

    Your point is either a misdirection, or a misunderstanding. Either way, it's not that relevant.



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