Democrats are losing the plot, and you know it is especially bad when other Democrats are calling them out.
California Rep. Ro Khanna proudly calls his economic agenda a “Next, New Deal,” a name that ought to set off alarm bells on its own. His blueprint includes wealth taxes on billionaires, a federally run industrial investment bank, the redistribution of venture capital from California to other states, and expansions of America’s most dysfunctional entitlement programs.
But when Khanna presented the plan on CNBC, Joe Kernen quickly pointed out its most obvious flaw, that whatever revenue new taxes generate would first be swallowed by the massive gap that already exists in our government's current spending commitments. Plain and simple, the current fiscal situation, something Democrats are happy to ignore, does not give us room for both higher taxes and universally expanded entitlements.
You could tell Ro Khanna was really hoping this was going to be a friendly segment on Squawk Box this morning...it was not.
— Overton (@overton_news) September 23, 202
After Khanna laid out his grand economic plan, which is essentially just taxing billionaires and increasing the size and scope of social programs, CNBC’s… pic.twitter.com/jy6yk1q13s
"So I believe the Democrats need an economic vision. But, Roe, if we raise taxes on whomever, billionaires, fine, if you want to do that, no skin off my back. Believe it or not, I'm not a billionaire. You're going to just expand more social programs, expand more spending, expand, expand, expand, not try to maybe pay down what we already have or narrow the deficit that we run every year," Kernen said. "Any new taxes, you've already got a place to spend them. And we know how well the government spends them."
"Well, Joe, here's the thing. I'm for investment that's going to create jobs, because right now we're wasting a lot of money. We've got, as you know, a $40 trillion debt, $2 trillion deficit. But why are we wasting money on wars that we are not winning, on insurance companies that are upcoding on Medicare Advantage, on drugs we're overpaying for, on fossil fuel subsidies?" Khanna asked. "I have a plan where I list areas where we can cut spending to reduce the deficit over $4 trillion."
"You didn't get me on any of these," Kernen said plainly. "Obviously, we need to spend money on defense. Maybe you don't like this war. A lot of people don't. But we need to spend money on defense. The fossil fuel subsidies, is that really the big thing? The things that you're talking about expanding are where most of the problems are. We need to do things with all the entitlements and all the welfare. We've got to fix Social Security, got to fix Medicare, got to fix Medicaid. We've got to fix all those things."
Results matter more than intentions. Democrats talk endlessly about compassion, and they have discovered the easiest political playbook in the world: promise the public more “free” services while quietly leaving taxpayers to discover what free actually costs.
But even setting aside the failures and inefficiencies of universal-health-care schemes, Social Security, Obamacare, and the country’s sprawling welfare bureaucracy, Democrats seem unwilling to recognize that their policies are helping breed the dissatisfaction now consuming American politics. They tax younger workers to provide services for older Americans, build regulatory empires that make housing harder and more expensive to construct, drive up costs for families, and make it more difficult for young people to find work, build wealth, and start families. Then they act surprised when the public concludes that the system is not working.
That is the closing contradiction of Khanna’s “Next, New Deal”: Democrats see a country already crushed by the cost and complexity of government and conclude that what it needs is more of both.