AMERICA CAN’T AFFORD BERNIE SANDERS’ $18 TRILLION AGENDA

It’s a well known secret that a candidate’s policy platforms during a campaign often has very little to do with the governing agenda they will actually use if elected. Campaigns are full of high-minded promises and low-grade vote buying, not the middle-of-the road pragmatism that usually carries the day.

But sometimes, once the toothpaste is out of the tube it’s hard to put back in. To see just how dangerous this can be look no further Obamacare, which became the central piece of Obama’s campaign platform by little more than happenstance.

For those that have yet to hear the fascinating origin story of Obamacare, the long and short of it is that the campaign team needed something (anything) to say in a speech that Obama was set to give to a left-leaning health care conference. There was no thought put into the scheme, it was instead an exercise is box checking: Universal health care is what the crowd wanted to hear, so it’s what the campaign told them.

“We needed something to say,” one of Obama’s advisers told POLITICO. “I can’t tell you how little thought was given to that thought other than it sounded good. So they just kind of hatched it on their own. It just happened. It wasn’t like a deep strategic conversation.”
All that is to say that what is said on a campaign can have long-lasting reverberations, whether a not it is a policy that is well thought through or simply written out on the back of a cocktail napkin. Which is why the Wall Street Journal’s recent report on the pricetag of Sen. Bernie Sanders’ proposed agenda matters. Laura Meckler reports:

Sen. Bernie Sanders, whose liberal call to action has propelled his long-shot presidential campaign, is proposing an array of new programs that would amount to the largest peacetime expansion of government in modern American history.

In all, he backs at least $18 trillion in new spending over a decade, according to a tally by The Wall Street Journal, a sum that alarms conservatives and gives even many Democrats pause. Mr. Sanders sees the money as going to essential government services at a time of increasing strain on the middle class.

His agenda includes an estimated $15 trillion for a government-run health-care program that covers every American, plus large sums to rebuild roads and bridges, expand Social Security and make tuition free at public colleges.

To pay for it, Mr. Sanders, a Vermont independent running for the Democratic nomination, has so far detailed tax increases that could bring in as much as $6.5 trillion over 10 years, according to his staff.

Notably, his staff didn’t refute the report.

“Sen. Sanders agenda does cost money,” campaign policy director Warren Gunnels told the Journal. “If you look at the problems that are out there, it’s very reasonable.”
Reasonable? It’s a strange use of the word considering that Sen. Sanders’ plans would represent a bigger increase in government spending than either the Roosevelt’s New Deal or Johnson’s Great Society. Moreover, it would increase spending without any plan on how to really pay for it. Currently, his agenda would add an additional $12 trillion onto the national debt over 10 years – pushing the figure from the current projected of total of $27 trillion, which the CBO has already deemed unsustainable, to a figure approaching $40 trillion.

To pay for that level of imbalance, Sanders’ would have to dig deeper much that piling taxes onto the millionaires and billionaires he loves to decry. In fact, according to an analysis the Wall Street Journal did several years ago of the Internal Revenue Service’s income tax statistics, confiscating all of the taxable income of millionaires and billionaires would yield a “mere” $938 billion. That doesn’t even put a dent in Sanders’ scheme.

Although he surely won’t say it, if he really wants to pursue this approach he’ll have to dramatically raise middle class tax rates, something that the Scandinavian countries he loves to cite do quite well. A recent analysis by the Tax Foundation found that Scandinavian countries raise a lot of their revenue through high and flat income taxes. For instance, Denmark’s top marginal tax rate of 60 percent applies to all income over 1.2 times the average income (around $60,000 in the U.S.). Similarly, Sweden’s top rate of 56.9 percent applies to all income over 1.5 times the average income and Norway’s top rate of 39 percent applies to all income over 1.6 times the average income. By comparison, the United State’s top marginal rate of 46.8 percent kicks in at 8.5 times the average income (about $400,000 in the U.S.)

Unsurprisingly, Sanders doesn’t like to mention the revenue side of the Scandinavian fiscal equation, opting instead to focus on their social welfare program. Maybe, if Sanders somehow makes it to the Oval Office, he’ll offer up a realistic way to fill the enormous fiscal hole he’s proposing on the campaign trail. Or maybe, like Obama before him, his current promises are a result of “needing something to say,” in which case we could all be in for a terrible surprise.