The TEA Party: Changing Lanes or Heading in a New Direction?

Born from fear of health care reform and its likely implications for rising taxes and growing federal deficits, what began as a simple acronym for “taxed enough already” has morphed into the closest thing to a legitimate 3rd party that we’ve seen in many years. I say “legitimate” because there have always been many parties beyond the Republican and Democratic parties – the Libertarian Party and the Green Party, just to name a couple. But none has ever garnered enough support to be taken seriously, much less to have a real impact on an election.

On the surface, the TEA Party seems to be nothing new. The promise of lower taxes and less government spending has always had broad appeal, and it’s been the backbone of the Republican Party platform (often abandoned once in office) for decades. But there’s a deeper undercurrent that I’ve often heard in describing its constituents that I find intriguing. They increasingly see no difference between the Republican and Democratic parties. The Tea Party is attracting a growing throng of voters who’ve come to the realization that minor course corrections on a wrong heading still leave us headed in the wrong direction. They’re craving something big and new – something that will really make a difference in our slow-but-steady economic decline. There’s an opening here for a new political party big enough to sail a container ship through it. To the extent that the TEA Party can deliver the message that business as usual is over – that we’re ready to abandon the bankrupt ideologies of our two major parties, it’s serving a valuable purpose.

But if lower taxes, less government spending and smaller government is all the Tea Party brings to the table, it’s destined for the scrap heap of other failed political movements. After all, in the final analysis, there’s precious little difference between the economy of one nation with no taxes and no government spending compared to another that taxes its citizens at 100% and then returns all of the money to them through a massive welfare program. Each is left with virtually the same purchasing power. Tinkering with tax rates and spending isn’t going to make any real difference. And if “less government” is the key to prosperity, then how does one explain the fact that the economy of China, a communist regime with total control of every aspect of its economy, is the fastest growing in the world while America’s is in decline?

The problem isn’t that we tax a little too much or too little, or spend a bit more or less than we should. What does make a difference is trade policy. A nation with a large trade surplus (like China) can’t help but have a booming economy, while any economy that runs a long-term trade deficit (like the U.S.) is doomed to decline. We got off onto the wrong trade policy road a long time ago, in 1947, when the U.S. signed the Global Agreement on Tariffs and Trade – the forerunner of today’s World Trade Organziation. Is the TEA Party ready to go down a new road?

At the same time, we’ve been stuck on another road to ruin since our country’s inception, relying on exponential population growth to drive economic growth. We enjoyed the pretty scenery along that road for a long time but lately, as we’ve added to the labor force faster than their output can be absorbed, the view from that road has been turning uglier. It now looks like a dead end into an economic slum. Is the TEA Party ready for a new direction?

Send a message? Throw the bums out? Fine, I’m there. But if the TEA Party turns out to be nothing other than a left-to-right lane change on the road to ruin, then it’s a complete waste of time and its candidates will be exposed as nothing more than opportunists with nothing new to offer. Instead, let’s hope this hard swerve to the right is the first step in a three-point turn to reverse our direction and get back on the right road.

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13 Responses to The TEA Party: Changing Lanes or Heading in a New Direction?

  1. Ben Hoffman says:

    The teabaggers are just pawns of the wealthy. Their so-called “grass roots” organization has been carefully orchestrated by wealthy lobbyists such as Dick Armey and the usual suspects. Taxes have never been lower and their protesting that they’re “taxed enough already?” Enough said.

    • Duh says:

      You are a pawn as well. The prices at Walmart simply haven’t caught up with the new reality for you to notice. But it will. Now hoist that sign up: “Higher taxes!”.

  2. Duh says:

    If taxes are directed toward paying foreign bond holders then its easy to understand why intelligent people should be concerned.

  3. MikeF says:

    Pete,

    You asked, “…how does one explain the fact that the economy of China, a communist regime with total control of every aspect of its economy, is the fastest growing in the world while America’s is in decline?”

    China is emerging in the world of consumption and America has reached the top of the mountain for that premise…America’s present economic model has matured and after maturity there is nothing remaining other than decline. Our maturity is dictated by available resources and constant NEW high paid employment. We have eclipsed the mathematical possibilities for both.

    But back to China. As a for instance, the Chinese economy can grow by manufacturing cheap goods with cheap labor for export consumption to mature high cost economies. This is not a vise-versa possibility.

    The Chinese can also grow domestically at a very low entry level, such as selling something as simple as new bikes, small auto’s, refrigerators, washing machines, etc. America passed that point many moons ago.

    In keeping with the theme of your article, I agree with your conclusion that the TEA Party will change faces but not the future. Debt Capitalism is grave yard dead; we just haven’t had the funeral yet.

    • Pete Murphy says:

      Mike, sorry for the delay in replying. Been up north again.

      Just want to comment on a couple of points. First of all, you said that “China is emerging in the world of consumption and America has reached the top of the mountain for that premise…America’s present economic model has matured and after maturity there is nothing remaining other than decline.” Once reaching maturity, isn’t another option a steady state? Why is decline the only option? We’re declining not because that’s the only direction to go, but because we chose to give away our market without getting anything in return.

      Secondly, forgive me, but I have to hammer home this point at every opportunity because I’m the only one who will. I disagree with blaming “cheap labor” for our trade deficit with China. The whole point of my book is that our trade deficit is rooted in the disparity in per capita consumption caused by the disparity in population density. Sure, labor in China is cheap, but the logistics involved in shipping halfway around the world is not. Labor is not cheap in Japan or Germany (and neither are the logistics), yet we have trade deficits with them that are even worse than our deficit with China. China has a trade deficit with Japan. Why? Because Japan is more than twice as densely populated as China.

      We have got to stop blaming cheap labor. As long as we do that, it merely encourages free trade advocates who claim that if we just wait long enough, wages will level out and so too will our balance of trade. The fact is that the trade imbalance will remain regardless of what happens to wages, unless tariffs are introduced.

  4. ClydeB says:

    The great hope for the TEA party movement is that we can start replacing some of the career politicians with citizen legislators. It is only then that we can hope to gain recognition for the principles that are so clearly enumerated in Five Short Blasts and and The Biggest Lie Ever Believed.
    The ever repeating cycle of campaign, satisfy lobbyists, campaign, satisfy lobbyists, campaign, etc., etc. must be broken.
    It may be possible for Citizen legislators to be convinced of the virtue of limited terms, balanced budgets through reduced spending and a foreign trade policy that makes sense.

    • Ben Hoffman says:

      [The great hope for the TEA party movement is that we can start replacing some of the career politicians with citizen legislators.]

      One problem with that: power corrupts. The honest citizen legislators become money grubbing bastards once they’re in power. The only way to put power back in the hands of the people is to take the money out of politics.

  5. MikeF says:

    Clyde,

    You are so correct. As our present system fails mathematically, SOMETHING WILL, that its place and hopefully that something will not be comprised of one incompetent president and 535 lawyers.

    I am pleased to be from the Colorado which was recently determined to be the angriest state in the union from the standpoint of government satisfaction.

    We so badly need those citizen legislators that you spoke of.

  6. ClydeB says:

    It just may prove to be possible to keep the pressure on the “money grubbing bastards” to play fair. If they gain office as a result of grass roots activity, they may respect that effort in the realization that they too are vulnerable. I’m betting the second batch will be much more cooperative, if it takes that long.

    • Pete Murphy says:

      This is a little off-topic for me but, regarding this issue of the corrupting influence, it’s another reason that I firmly believe our constitution is in desperate need of amendment. I seriously doubt that our founding fathers ever intended for money to be equated with “speech,” or for global corporations to be interpreted to be “the people.” Our first amendment, along with others, needs clarification and modernization. Relative to modern circumstances, the constitution and its amendments are becoming so vague and must be interpreted so broadly that the end result is “anything goes.” Pornography becomes “free speech,” the voices of the real people are drowned out by global (even foreign) corporations, and free speech is sold to the highest bidder, rendering the vast majority of Americans effectively mute.

      And, getting back to my area of expertise, I’m sure our founding fathers would recoil in horror at the prospect of our lawmakers standing idly by while our economy is plundered by parasitic countries abetted by the World Trade Organization. It seems increasingly clear to me that lawmakers and leaders will never act on any of our critical issues unless it’s mandated by the Constitution.

  7. MikeF says:

    Pete,

    You asked, “Why is decline the only option?” Certainly it’s the only option for our current underlying system of growth-based-debt-capitalism.

    There is no serious talk anywhere about a steady state economic model. Our entire nation is TOTALLY dependent on growth. Going to ANY other system will bring down the tent. We passed the point of no return in 1970 Pete. Our government will print money until they run out of trees rather than admit to The Biggest Lie Ever Believed.

    On labor, while I don’t disagree with your theory, there is far more to labor costs than hourly wages and I will continue to defend my position that China can maintain a domestic growth model beginning at the most basic level. We must always factor in our minute 4.8% of world population and our consumption of 30% of world materials and 25% of world energy. Those days are over!

    • Pete Murphy says:

      Mike, you seem to be saying that there is no hope, that the U.S. economy (indeed the world economy) is doomed, regardless of what anyone does, even if we throw out the growth model. It’s one thing to say that our current economic model is based upon growth and is doomed to failure. It’s quite another to say that we’re dependent on it. The first allows for a different model. The second doesn’t.

      Regarding the last paragraph, I agree that those days should be over, but they’re not yet. What’s worse is that economists and world leaders believe that China, with one fifth of the world’s population, can consume resources at the same rate as the U.S., followed by every other country on earth.

      • MikeF says:

        Yep, the Cornicopians reign supreme.

        While teaching fly tying to 6th graders on the river today, at lunch I explained to the adults that our unerdlying system of economics could be compared to putting more fishing pressure on the river each and every year, while at the same time saying that regardless of the number of fisherman, everyone could continue to harvest the same amount of fish in perpetuity.

        I’m not saying that we can’t change our base economy, however, I am saying that we can’t change it without causing a complete collapse. EVERYTHING is based on exponential growth. Social Security, employment, medicare, government pensions, the stock market, military retirement, private retirement accounts, compounding interest,…and so on. We borrowed the future to arrive at this point Pete and now we can’t pay it back.

        The exponential function has proven to be a worthy adversary.

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