In 2016, I criticized the International Monetary Fund for that bureaucracy’s accurate but hypocritical attack on Trump’s protectionism.
The IMF constantly endorseshigher taxes on wages, saving, investment, and other forms of productive behavior. Yet the bureaucrats wanted people to believe that higher trade taxes were terrible.
They were right about trade taxes, of course, but it is total hypocrisy to criticize those taxes while embracing other taxes that surely do even more damage to global prosperity.
Today, let’s look at another example of rank hypocrisy. And also an example of rank partisanship.
The Washington Post has an editorial today that strongly criticizes “stimulus” checks. Here are some excerpts.
There is reason to be skeptical that Elon Musk’s U.S. DOGE Service will hit its goal of cutting a trillion or so dollars of wasteful spending. …To the extent that Musk’s efforts do generate substantial savings, however, there is only one responsible use for them: reducing the national debt. …Yet at a gathering in Miami on Wednesday, Trump said he was considering a plan to disburse 20 percent of any DOGE savings as checks to American citizens. …Some might indeed ask why U.S. taxpayers shouldn’t see the supposedly wasteful spending uncovered by DOGE in their own pockets. After all, it’s their money. …America ran a deficit of $1.8 trillion last year, adding to a mountain of debt that is nearing 100 percent of GDP. …Using DOGE’s savings to write checks would be doubly reckless given that the massive baby boom generation is retiring, placing unprecedented demands on U.S. entitlement programs. …As long as the government is running big deficits, those checks will be financed with borrowed money, which means taxpayers wouldn’t really benefit. …Over the long run, you can’t make yourself better off by charging another $5,000 on the credit card — whether you’re an individual or a nation.
I don’t have strong views on how to use DOGE savings in large part because there won’t be any savings until and unless Congress and the President enact a rescission for the current fiscal year.
Alternatively, Congress and the President can reduce spending totals in next fiscal year’s appropriations bills and/or reform entitlement programs.
Instead, I want to focus on the Washington Post‘s epiphany about “stimulus.” The editorial was reasonable, but it’s also a break from what the Post favored in the past.
So why is the newspaper suddenly in favor of deficit reduction?
Bending over backwards to be fair, I suppose folks at the Post would make a Keynesian argument that the economy doesn’t need “stimulus” today.
Since I’m a skeptic, I think the more likely answer is that the paper favors mailing out checks when Democrats are in power and opposes the same policy when Republicans are in charge.
I’ll close by pointing out that real tax burden is the amount government spends, whether financed by current taxes, future taxes (borrowing), or hidden taxes (money printing).
Dan Mitchell is co-founder of the Center for Freedom and Prosperity and Chairman of the Board. He is an expert in international tax competition and supply-side tax policy.
