Paul Krugman helpfully reminds us that the conservative playbook includes the "starve the beast" gambit:
. . . remember that the push for Social Security privatization is only part of the right's strategy for dismantling the New Deal and the Great Society. The other big piece of that strategy is the use of tax cuts to "starve the beast."Until the 1970's conservatives tended to be open about their disdain for Social Security and Medicare. But honesty was bad politics, because voters value those programs.
So conservative intellectuals proposed a bait-and-switch strategy: First, advocate tax cuts, using whatever tactics you think may work - supply-side economics, inflated budget projections, whatever. Then use the resulting deficits to argue for slashing government spending.
And that's the story of the last four years. In 2001, President Bush and Mr. Greenspan justified tax cuts with sunny predictions that the budget would remain comfortably in surplus. But Mr. Bush's advisers knew that the tax cuts would probably cause budget problems, and welcomed the prospect.
But as Krugman points out in the rest of his column, the problem of the political side of the equation remains: a large majority of Americans don't support the cuts to Social Security, Medicare, and Medicaid that conservatives would like to enact.
The likely outcome? In the short-term, more deficit spending and some cuts to politically vulnerable programs. In the long-term, well, it's not clear. Perhaps a great fiscal crisis that will achieve conservative goals.
More: See this article by Gail Russell Chaddock of The Christian Science Monitor for an analysis of the growing burdens that Medicaid is placing on states.
