Perhaps unwittingly, Marjorie Taylor Greene may have pointed the way to a bi-partisan budget resolution that could reduce the federal budget deficit by a half a trillion dollars annually. Democrats should seize the moment.
In a recent speech before the conservative populist group Turning Point Action, Greene railed against Joe Biden for seeking to improve the lives of Americans by investing in medical care, education, and economic development, and seeking to ameliorate rural poverty. Biden’s crime? “The largest public investment in social infrastructure and environmental programs that is actually finishing what FDR started, and LBJ expanded on, and Joe Biden is attempting to complete. Socialism… and it’s killing the American Dream.”
While Democrats roundly ridiculed her remarks, the question of whether the social safety net created by FDR’s New Deal and LBJ’s Great Society have been the foundation of the American Dream, or have been responsible for killing it, has been a matter of contention between the political parties for the better part of a century.
There is no small irony that FDR first envisioned what would become the New Deal during his time spent convalescing from polio in Warm Springs, Georgia, barely 90 miles from what is now Marjorie Taylor Greene’s congressional district.
What FDR imagined as the cornerstone of a national commitment to address the endemic problems of rural poverty that he saw around him in Georgia, Greene points to as the beginning of a socialist wave that has undermined the moral foundations of the country. Her anti-socialist screed, attacking what are generally viewed as the defining accomplishments of the Democratic Party, reflects the long-held view of the conservative business wing of the Republican Party.
Government, in their view, can never solve society's problems, but only creates them. In the words of Andrew Bevel – the plutocratic financier protagonist in author Hernan Diaz’s recent novel Trust – FDR’s New Deal destroyed all that had made America great: “Where perseverance and ingenuity once dwelled, apathy and despair now loiter… The working man is reduced to a panhandler. A vicious circle has taken hold of our able-bodied men: they increasingly rely on the government to alleviate the misery created by that government, not realizing that this dependency only perpetuates their sorry state of affairs.”
Oh, for the good old days, when rugged self-reliance and personal responsibility was an authentic Republican philosophy, and politicians preached to voters complaining about their lot in life: ‘Not happy with where you are? Stop whining, and do something about it. Pull yourself up by your bootstraps. Work harder. Go back to school. Get a better job.’ Indeed, that was essentially Mitt Romney’s stance in the 2012 presidential campaign.
But no more. The GOP culture of self-reliance and personal responsibility has given way to the Trumpian culture of resentment and blame. Like Greene’s rant, everything from Republicans today is about pointing the finger of blame at blue state elites for their constituents’ woes, demonizing those who violate their Christian fundamentalist creed, and accusing colleges and universities for corrupting the nation’s values.
If the essence of socialism is the redistribution of wealth, Democrats have no choice but to plead guilty. For the better part of a century, since the creation of the federal income tax and the advent of the New Deal, blue states have willingly paid the lion’s share of the cost of an expanding web of federal programs, in the hope of improving the livelihoods of people living in the poorer areas of the country.
The essence of that structural redistribution of wealth was summed up succinctly in a report issued by the conservative Tax Foundation. “Thanks to a steeply progressive federal income tax, states with higher incomes pay vastly higher federal taxes, payments that are unlikely ever to be matched by federal spending directed to those states. Ironically, most of these high-paying states are the so-called blue states that have generally elected politicians who support a more steeply progressive tax system even though their own constituents bear a greater share of the burden as the code gets more progressive.”
In 2014, the National Priorities Project (NPP) did a deep dive into data on federal taxation and spending to assess the magnitude of the redistribution of wealth that the Tax Foundation described. The NPP report calculated each state’s federal expenditures – including federal aid to individuals, as well as grants, contracts, and federal employment – and federal taxes paid, allowing for a simple calculation of each state’s balance of payments.
The numbers are significant. The table below summarizes the redistributive impact of federal spending and taxation in eleven states across the south that represent the heartland of red state America. As the table illustrates, the negative balance of payments of just those eleven red states – what is effectively a net subsidy from the federal government – was $351 billion, an amount equal to $492 billion in today’s dollars.
With a new federal fiscal year beginning on October 1, the House Freedom Caucus – which is dominated by members from those eleven states – is preparing to go to war over the issue of budget deficits, and threatening once again to shut down the government if they do not get what they want. Democrats need to come up with a substantive response, and a budget plan centered around ending the subsidies identified by the Tax Foundation and laid out in detail by the NPP could provide a path forward.
A proposal to cut back federal spending that Marjorie Taylor so reviles would be based on the philosophical premise that the era of New Deal and Great Society paternalism has run its course. Republicans in red states believe federal programs are stifling their economic development and personal liberty, while blue state taxpayers are no longer interested in paying the freight for federal programs and investments in red states that deeply despise them. Therefore, Democrats should propose that, going forward, federal spending in any state should not exceed the taxes contributed by that state to the federal government.
The National Priorities Project data suggests that instituting budget caps tied to federal taxes paid just by those eleven states could reduce federal government spending by as much as $492 billion in current dollars. By way of comparison, that amount is more than three times the $131 billion in year one deficit reduction demanded by the House Freedom Caucus.
This proposal would mark the first substantial rollback of socialism – to use Marjorie Taylor Greene’s term – since the New Deal. It would allow for a budget resolution philosophically aligned with the interests of a large share of both blue state Democrats and red state Republicans in Congress. It would allow red states to curtail federal program spending in their states that they believe is thwarting individual initiative and economic opportunity, while blue states would not have to accept cuts in federal programs that their taxpayers have been paying for all along.
Parsing the details would not be easy. As the National Priorities Project study points out, some of the funds flowing into any state are spent on activities that benefit the nation as a whole, while others flow to individuals as entitlements not linked to location. Despite the complexity, people should not be too quick to dismiss the essential merits of this proposal, as introducing the idea of a state revenue based cap on federal spending into the upcoming budget discussions would achieve several purposes.
First, it would offer a counterpoint to the Freedom Caucus demonization of blue states by focusing attention on the structural imbalance between where revenues are generated and where they are spent; or, in terms of pure politics, who benefits, and who is footing the bill.
Second, it would offer a basis for curtailing the steady expansion of federal programs that so many Republicans claim to find so repugnant. For example, in the administration of the state-by-state cap, states might be offered a cafeteria plan from which to choose which programs would continue to be provided within their state and which would be terminated.
And, finally, putting the prospect of real program spending cuts in red states on the table could temper some of the hubris that typically surrounds cutting federal spending. For years, advocating deep cuts in spending has been an easy political applause line for Republican politicians, for the simple reason that they knew those cuts would never actually happen.
Would Marjorie Taylor Greene sign on to a plan that actually reduced or eliminated federal funding in Georgia for all those programs she ticked off? Perhaps. Perhaps not. But simply suggesting a cap on spending in red states, and proposing to end the structural subsidization of red states by blue states offers the prospect of reframing the narrative around federal deficits, injecting a greater degree of honesty into the budget debates that lie ahead.
Yes and…. subsidizing poorer parts of the country is what makes us a nation. It should unite us. We support lower income states because our fundamental unit of analysis is America. If we start thinking what’s in the interest of blue states, what’s in the interest of red states, that’s an 1850s mentality and we are setting the stage for a real civil war.
And, wouldn’t it be nice if our unit of analysis were the Earth and all its inhabitants. What’s good for our planet and those who live on it?
“Imagine there's no countries
It isn't hard to do
Nothing to kill or die for
And no religion, too”