Posted by: Bruce Allen | March 13, 2019

Guns and Butter

© Bruce Allen

Dear Mr. BruAl–

I came across an opinion column from the 1950’s describing a national political debate in which the term “guns or butter” repeatedly appeared. What does it mean, and why don’t we hear it used today? Sounds as if it has something to do with hunter/gatherer societies in the olden days.

Signed, Perplexed in Parsippany

Dear Perplexed–

The period in history during which one heard the “guns or butter” debate was the archaic 1950s, a time in which Federal expenditures, on everything, pretty much equaled the tax revenue generated by the economy. This used to be a creature, similar in many ways to the dodo, known as the “balanced budget.” Due to a combination of political cowardice, inarguable demographics, a grossly inflated military budget, and a general population surprisingly unconcerned with the welfare of their own children and grandkids, this creature, too, will likely never again be seen by the eyes of man.

In metaphorical terms, “guns” in post-WWII America represented favorite Republican themes of support for business, free trade, a strong military, and civilized diplomacy. “Butter” reflected more Democratic preferences for social programs that sheltered and fed the poor, which ultimately led to what we now refer to as “entitlements,” health and income benefits funded largely by one’s own payroll deductions. Medicaid, as separate program altogether, has provided second-rate services to the poor for generations. All of these, and numerous other programs, have become knit together in the social safety net 95% of Americans rely on during their old age.

Back in the day, when Keynesian economics ruled, governments would pursue deficit spending during lean economic times or in wartime, in order to spur the economy to produce more goods, services, jobs and enemy dead. During flush times, when the American engine was hitting on all eight, governments were supposed to rein in spending, operate in surplus, and pay down the debts incurred during the preceding downturn. All the while, the intra-budgetary squabbling focused on how much should be spent on guns and how much on butter, as it was a zero sum game with winners and losers. Still, from a macro perspective, these battles took place upon the ground of keeping revenues and expenditures roughly in line, over time.

The generally spectacular performance of the American economy between 1946 and 1966 led politicians to the belief that one no longer had to choose between guns or butter, but that one could, in fact, have both. Such a decision would, of course, lead to small, permanent deficits which would, it was purported, easily get paid back as the economy outgrew the debt burden. Lyndon Johnson’s Great Society program, in conjunction with an activist military policy toward southeast Asia–recall the Domino Theory–started us down the road to where we are today, politically jammed up against incomprehensibly large and fast-growing deficits, the carrying costs of which consume an ever-greater percentage of Federal expenditures, putting more pressure on both the gunners and the butterers.

The issue of defense spending is an entire argument unto itself. I used to believe that America over-spent on defense. But with all the bad actors out there, I’m not so certain anymore. Someone else can write about that. But as for the butter issues, they could mostly be solved by the stroke of a pen. The amount of money each year flowing into Social Security and Medicare trust funds is not a matter of economics; it is a matter of politics. Political decisions determine this sum each year, and political decisions are to blame for most of the serious financial problems faced by these socialist income and health programs, without which America would soon resemble a third world country.

The primary issue, of course, is the limits on income exposed to SSI and Medicare taxes. For 2019, this number is $128,400. Above that, incomes are exempt from these taxes. A buttery policy decision to raise that number to, say, $500,000 would erase any looming deficits in these accounts, other than the $1 trillion or so that Congress has borrowed/stolen from them. But the simple mention of doing so gives Senate Majority Leader Mitch McConnell the vapors, and absolutely no one on the Republican side of the aisle will even discuss it. All one ever hears–ever–from Republicans is that fiscal responsibility DEMANDS that we cut SSI and Medicare benefits, funds which aren’t even theirs to begin with.

Bullshit.

Until the United States deals in a meaningful way with these two giant math problems, everything else we do as a society, short of trying to prevent North Korea from immolating the planet, is a workaround, a re-arranging of the deck chairs on the Titanic. Democrats must seize upon this issue and take the social safety net off the everyday fiscal-cliff agenda, instead looking for real, meaningful ways to cut costs in Medicare and increase Social Security benefits for those at the bottom. Doing so should become a possibility after the 2020 election, presuming Trump resigns or loses and the Senate gets flipped. At which point we may also pay more attention to the fact that the planet itself is melting.

During Lent, we are reminded that there are millions of Americans who enjoy neither guns nor butter. (Well, maybe guns.) Societies, we are told, are not remembered for how they coddled their billionaires. They are remembered for how they treated their poor. In a perfect world, charity would take care of everything and government could stay out of people’s wallets. Needless to say, ours is an imperfect world.

 

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Categories

%d bloggers like this: