The Case Against Mitch Daniels, Part 1

Indiana Governor Mitch Daniels is running for president.

Oh, he hasn’t said so for sure, but he is.  I watched him on the Fox-Republican “News” Channel yesterday and you can just see it in his nervous eyes. 

But one of the real reasons I am certain he is running is because he took the trouble to downplay his time serving as a W. Bush official. Unfortunately for him he was Bush’s first Budget Director. He served the administration for almost two and a half years, when drunken conservatives were spending Clinton surpluses on millionaires and billionaires and two wars and a Homeland Security behemoth and a new entitlement program, Medicare Part D.

As the Indianapolis Star reported in 2005:

Bush gave Daniels the nickname “The Blade,” but the administration’s tax cuts combined with an economic downturn put Daniels in the awkward position of watching a $236 billion annual surplus turn into a $400 billion deficit during his 29-month tenure.

Whoops!  But don’t worry. It wasn’t his fault.  He told Fox,

…nobody was less happy than I to see the surplus go away, but it was going away no matter who was the president.

Ha. That’s funny. But it gets better. He said to NPR’s Steve Inskeep this morning:

DANIELS: Look, I was proud to serve in that administration, but that surplus was going away, and it wouldn’t have mattered who was president, let alone in the supporting role of budget director. We had the collapse of the bubble, the recession…

INSKEEP: After 9-11.

DANIELS: Then 9-11, with all the costs that came with that, the whole new category we call Homeland Security and two wars — so, I mean, that deficit [sic] was going away and it wouldn’t have mattered who was in any of those jobs.

Another laugher. But this time with a twist. That “[sic]” NPR had to insert in the transcript tells a tale. A nervous tale.  He meant surplus, obviously, but deficits and his role in creating them are on his mind. The man is a little worried about how his role in the Bush administration’s mismanagement of the economy will play in Peoria.

I want to note that Inskeep should have asked him why, with all the massive government spending the Bush administration believed was necessary, didn’t Daniels advocate actually paying for some of that stuff?  Maybe someday out on the campaign trail we’ll get an answer to that question.

But Inskeep did get close:

INSKEEP: Would you not have, would you not have approved of those tax cuts?

DANIELS: I did approve of the tax cuts. And by the way, they were widely credited — and still are, by honest people, with the shallowness and the swiftness of recovery from that recession.

Like a good conservative, he did approve of the tax cuts. But what about that business about the “shallowness…of recovery“?  I, for one, won’t argue with that anxiety-induced admission.  But he’s clearly nervous talking about this issue.  That’s not good for  a man George Will claims has the “charisma of competence.”

But I want to continue on with what he said next:

That was lucky by the way, it’s only fair to say, President Bush never proposed those tax cuts as a stimulus as we now see matter, ’cause nobody knew we had a recession starting up. But the timing was somewhat lucky.

Now, let’s look at what Bush’s budget czar is saying here:

1) The Bush tax cuts had a positive effect on the economy: “they were widely credited…with…the swiftness of recovery from that recession.” 

There is a dispute whether those tax cuts had anything to do with the recovery. But let’s move on:

2) The tax cuts, which have deprived the treasury of at least $2 trillion and counting, were not intended as government stimulation of economic growth: “That was lucky by the way…President Bush never proposed those tax cuts as a stimulus.”

Hmm. Just lucky?  Doesn’t Mr. Daniels know that the First Law of conservative economics is that tax cuts = economic growth?  And if he thinks they weren’t designed to enhance economic growth, what was their purpose?  To destroy our fiscal health?  Huh?

And surely he knows that George Bush did in fact sell the 2003 tax cuts as stimulative. Bush said the following, when he was signing into law the final phase of the Bush tax cuts:

By insuring that Americans have more to spend, save and invest, this legislation is adding fuel to an economic recovery. We have taken aggressive action to strengthen the foundation of our economy so that every American who wants to work will be able to find a job.

It’s obvious Governor Daniels wants to run for president and wants us to forget his time and part in the previous mismanagement of our nation’s finances.  I don’t blame him for that. But the Bush tax cuts were a big piece of that mismanagement and are responsible for a big chunk of our debt, and their legacy continues.  Yet Daniels, who sees the debt problem as the new “Red Menace,” has learned exactly nothing from his previous role in the mismanagement of the economy:

INSKEEP: Uh, is the problem grave enough that those tax cuts should be allowed to expire? They’ve now been extended through 2012.

DANIELS: I think it’d be a catastrophic mistake…I think raising taxes right now in a very fragile economy, still, would be a real mistake.

Let’s see here.  Back in 2001, when we had budget surpluses, Republicans, including Daniels, argued that was the time to cut taxes. “Give Americans their money back,” they insisted.  Now, when we have enormous deficits, we must keep the cuts in place.  “We can’t afford to raise taxes,” they insist.

Perhaps you guessed by now that there is never—never—a time in which conservative Republicans believe taxes should be such that they pay for the size of government Americans have come to love.  And Daniels, who is widely praised as the best hope to defeat Obama in 2012, represents everything that got us to this point of unsustainable debt.

He also represents everything that is wrong with conservative thinking on today’s hot topic, public sector unions.  As NPR pointed out this morning, it didn’t take Daniels long to establish himself as a full-tilt conservative union-buster:

In 2005 on his first day in office, Indiana Gov. Mitch Daniels signed an order ending collective bargaining with public employee unions. He said it freed him to turn over some state jobs to private contractors.

If that doesn’t energize the labor movement against him, nothing will.

But beyond that, should Daniels decide to run, as I believe he will, Democrats need to hang the Bush tax cuts around his Bush-administration neck and make him defend them again and again, even while he hypocritically tries to convince voters that a deficit menace is our nation’s biggest threat.

You just can’t claim you’re serious about the debt problem and take taxes off the table.

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