Deroy Murdock has a piece on National Review Online about the threat of tax and spending hikes under a Democratic Congress.
The threat seems to me exaggerated. Yes, Democrats would love to raise taxes. But just because Charlie Rangel would be House Ways and Means chairman doesn’t mean tax hikes are a foregone conclusion. I actually think President Bush would remember where he stashed his veto pen if his tax cuts were really in jeopardy and it’s unlikely the Democrats will have a veto-proof majority in Congress. (Mark the day: I’ve finally said something complimentary about the president!) That’s assuming a bill raising taxes even passes out of the House in the first place, of course. After all, 15 Democrats did vote to extend the capital gains and dividend tax cuts earlier this year.
On government spending, the same logic applies. The Democrats are just not likely to have enough votes to get everything they want. The 30-plus fiscally-moderate Democratic members in the Blue Dog caucus will also have more clout in a closely divided Congress. The back-bencher GOP members who have always fought against profligate spending – Jeff Flake of Arizona, Mike Pence of Indiana, Jeb Hensarling of Texas, et al – will still be around and have more pull in this scenario, too, especially in the wake of the inevitable post-defeat purge of the current leadership ranks. Indeed, many Republicans who were quite fond of Big Government when they were pulling the levers might suddenly become budget hawks now that the “other guys” are in charge.
So, such a scenario would probably not result in a reversal of current tax policy. The ensuing gridlock would probably result in a slower rate of budget growth as it has in the past (which is something I’ve pointed out before). The world wouldn’t end. Indeed, it might actually look a little brighter – at least in the short term – for those hoping to see restraint in the growth of government.