Back in December 2008, Sterling Newberry posted a "back-of-the-envelope" calculation of the cost of conservatism:

over-financialization of the American economy, the waste of privatized health care, over militarization of the American economy, and the externalization of global warming . . .  [which] Added up . . .  is 12% of output, or using [Lawrence] Lindsey's 15 year time frame 36 trillion dollars.

As Newberry concluded,

So what does this exercise mean? It's really very simple: we can afford a decent retirement and decent living standards, and decent medicine for ourselves and our children and grand children, or we can afford the casino games that we have played, and the massive parade ground military that we have built over the last generation. But not both. The costs of the war and bad economic policy flow all through the economy.

The reality is that liberalism isn't broken. The reality, contra the film IOU-USA, is that the national debt is a symptom not a cause. The real cause is that Americans have voted for certain things - a huge military, a casino economy, and an anti-science bias - cost be damned. Well the cost is damning, it is damning us to this recession, and it is going to damn us to a very poor recovery on the other side of it.

Btw, a day or so after it was posted, I posted a summary of Newberry's little exercise on epluribusmedia.net, and the webmesiter the next day emailed me that it was getting a large amount of attention from traffic originating with World Bank and IMF servers. Interesting, huh?

Everytime I see or hear someone - who probably failed to foresee the financial maelstrom approaching - talking about what a terrible threat the exploding deficit is, I always think back to what the cost of conservatism has been. Any suggestions on how to fram this repsonse better? Or is it a non-starter?

Liberalism is NOT broken; the real story is conservatives have been working hard for decades to mug liberalism, rob it, and make it look broke.

You are absolutely spot on, of course! This is meant to confuse and bewilder us, naturally.

Several months ago, one evening on the way home, I noticed a woman in her early thirties reading The Economist. I inquired of her if she had ever bothered to verify any of the numbers she read in that publication (or Newsweek, Time, NY Times, and so on) and she though I was joking, as of course, she had never and would never check.

This AM, on NPR (totally corporate-controlled, of course, as are are the other foundation-sponsored "news" shows), there appeared an individual from a pro-immigration-total-amnesty non-profit (sponsored by all the major corps, of course) who proclaimed we didn't have enough unskilled and skilled people in the US of A!

Of course, it wasn't mentioned she had been a Senior Fellow at the Manhattan Institute, had been appointed to several positions by The Former Prez, George W. Bush, nor had written propaganda over at Newsweek, and so on.

With 50,000 foundations (many special purpose to skew the "news" - and not really serving any other purpose - although they always claim otherwise) to alter, misdirect and social engineer Americans, is it no wonder so many are so confused and bewildered. (And lest we forget: 35,000 lobbyists and only 5 media-controlling corporations.)

What was that term? One thousand points of confusion?

For VAT to be progressive, and to do *some* good for US exporters. The Graetz Competitive Tax Plan is certainly a good example of how to make VAT progressive (though I think he'd do better if he'd replace payroll withholding with a payroll subsidy for anybody earning under $15,000/year/dependent, paid for in VAT rebates).

I'm just wondering if we aren't making the same mistake as India and China at this point though. Bear with me a second for me to make this argument, even though it's more based in politics than math.

The current economy is done for. Petrodollars will soon not be a reserve currency for anybody. The ability of the United States to make money exporting *anything* is greatly diminished. But with every crisis, comes an opportunity (the only intelligent thing I ever heard come out of the Bush Administration, and they used it wrong). We have an opportunity to make a *stable* economy for our citizens.

Basing our recovery on exports in a fickle world market isn't exactly a stable option. The VAT would give us a swifter recovery to be sure, but it's one that is based on the goodwill of other nations that have shown themselves in the past to not have very much goodwill towards us. A recovery based on foreign trade, is a recovery selling your people into indentured servitude.

If, in addition, we choose true protectionism- which there is nothing really wrong with- and either exit the WTO or renegotiate our trade treaties with them to remove the down side of VAT rebates from international trade, then we're going to have to replace imports with domestic manufacturing- and that's a good thing every time you do it. Anything a country doesn't need to import and can make itself is what actually grows a stable economy.

I know the argument "but what about Smoot-Hawley and David Ricardo, doesn't protectionism hurt both countries, especially in a depression?" I suggest that is an argument born from valuing profits for the few over jobs for the many- and by having an economy overly dependent upon foreign trade, you've just given away a huge chunk of your ability to actually have a government of, by, and for the PEOPLE, instead of,by, and for international traitors.
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Maximum jobs, not maximum profits.

Some of this is coming from Graetz, correct? and his tax reform proposals.

Now I found some intelligent criticism of him at the Center on Budget and Priorities, yet once again, this organization is completely ignoring the globalization effect on our economy and how other nations use a VAT at the border.

Graetz ideas are partially summed up in a competitive tax plan and make no mistake, he is a Yale (Columbia?) Professor, highly respected as a tax expert, testified before Congress, etc.

So, this is not some willy-nilly idea.

Here's a paper (is he still at Yale or Columbia?) of Graetz blasting the flat tax....

but the bottom line on any of this is, I think, at least on EP, we want a Progressive type of taxation structure (as well as increased social safety nets, middle class support), but folks, come on, read. Frankly, can you please consider all comers and listen to real criticisms?

Knee jerk comments without analysis, points are thoughts that aren't helpful.

any intelligent criticisms and not by "shrink gov. to the size of a bathtub Norquist" or others just doing some knee jerk reaction or miscategorizing this as a national sales tax or even worse, as a flat tax (all those who believe in a progressive tax structure despise the flat tax idea).

Or something more Academic to do revenues projections, some sort of offsetting tax to erase the regressivity (i read of a national sales tax that was "turned" into a progressive tax).

Has anyone gotten a detailed policy proposal together or even better, written up a bill, trying to get someone to introduce it in Congress?

As I've read the materials, most of it is about challenging other nation's VATs...and as I understand the situation, getting anywhere in other nation's VATs is going nowhere so now the "rock and the hard place" solution is to counter them with a U.S. VAT tax proposal.

 There is no single trade issue that is quantifiably bigger than the VAT.  The average 17% VAT applied to our exports by 140 countries is comprehensive and profoundly large.  The VAT subsidies that those 140 countries rebate to their exporters sending to us is similarly comprehensive and profoundly large.  Not even currency manipulation applies to all bilateral trade from all countries.  Labor, environmental, other subsidies... nothing else comes close.

See this one-pager on the VAT problem.

The ones asking the best questions are also the ones who enabled the Bush tax cuts and the original deficit spending (and probably the deregulation, I'm not sure I did not check their voting records/legislation/etc., I just noticed the "R")

Now that they have started down this road .... the so-called deficit hawks will be unable to ever pull away the punch bowl.

Oh sure they will grandstand about it, which gets the MSM coverage. But the votes will be entirely different.

The corporate welfare state has not strengthened the economy or weened corporate America of the public teet ... They are fat, lazy welfare queens of the most dispicable kind. We have zero interest rates and have donated trillions of dollars with no results. As soon as the FED acts as they will raise interest, the economy will tank again. As soon as they cut off bailouts for any of the industries they are propping up, they will fail.

Wall Street is not a measuring stick for Main Street. With trillions pumped into Wall Street is it any wonder the market is rising? So what! ... we are still losing jobs at a record pace ... people will just start rolling off the other end and thus not be counted as unemployed. Interest rates on bonds are rising even while the FED is buying.

I have said before. The bailout is going to make it worse than the collapse.

And I think I need the ability, based on the comment I just edited twice in under a minute, to avoid this topic.
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Maximum jobs, not maximum profits.