Subject: Ezra Klein
From: "Eric Schwerin" <[email-masked]>
To: "Hunter Biden" <[email-masked]>, "David Schwerin" <[email-masked]>
Date: Wed, 8 Jun 2011 07:50:17 -0400

I want to propose a new rule: If you're telling your audience what they want to hear, you can't present yourself as telling hard truths. Tim Pawlenty's book is titled "The Courage to Stand." The theme of his speaking tour is called "Tell the Truth." And his message? That substantially cutting taxes will increase economic growth by 150 percent and reduce the deficit by 40 percent. Some hard truth. Next you'll deliver the bad news that if I stop paying my mortgage, my income will grow twice as fast, the bank will pay off half my loan and I'll be able to use the savings to redo my kitchen. Or perhaps you'll sit me down to explain the bad news that eating more pie will stimulate my metabolism and help me lose weight. Ooh, I'm really going to resent you for that one!
To be fair, after riffing on his willingness to deliver hard truths all over the country, Pawlenty does admit that the "the truth about our economy isn’t hard at all." But here's the pity: he's wrong on that, too. The truth is hard. A GOP contender delivering "the hard truth" would sound something like this:

"We've got two problems. A jobs crisis now and a debt crisis soon. Easing the jobs crisis now requires doing something that feels wrong, that polls poorly, but that's economically right: increasing the deficit by even more. So I'm proposing a full payroll tax cut -- both on the employer and the employee sides -- till unemployment returns to 7 percent. I'm also starting up a major infrastructure-rebuilding effort. We've got trillions of work to do in this country and lots of construction workers who've had nothing to do since the crisis. This is money we're going to have to spend sooner or later, so better to spend it now, when it can also help the economy, rather than later, when it won't have any macroeconomic impact."

"But stimulus isn't free. If Democrats want me to sign that bill -- and they will -- every dollar of stimulus needs to be accompanied by four dollars of deficit reduction between 2013 and 2022. I know my Republican friends won't like this, but some of that money, in the end, will have to come from revenues. Not most of it. Not half of it. But some of it. The responsibility of Republicans isn't to oppose all tax increases at all times, but dumb tax increases at any time. So those revenues won't come from hiking marginal rates. They're going to have to come from cutting tax breaks and closing loopholes because, as even Republican economists will tell you, smoothing out the tax code doesn't have the anti-work incentive of increasing the taxes people pay on the last dollar they earn."

"Unfortunately, I can't tell you this'll solve all our problems. The Obama administration made the mistake of saying their stimulus plan would head off the recession before they even knew how big the recession was. They've paid for that dearly, as they should've. My plan won't end our jobs crisis. It'll help. But much in the economy is outside of the government's control, and one difference between Republicans and Democrats is that we Republicans know that. As for deficit reduction, my plan will work, but it will hurt. Real spending cuts mean hitting programs people like and use, and closing tax loopholes and shaving tax breaks mean that many Americans, some middle class, will pay a bit more in taxes."

Would every Republican voter like that? Of course not. But that's what makes it the hard truth.

Eric D. Schwerin
[email-masked]

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