So much for the "laughable curve"

Arthur Laffer has been making the rounds with his book proclaiming that the 'Age of Prosperity' is over.


He should call it the age of debt.


This is, of course, the guy who came up with the Laffer Curve that told Ronald Reagan he could cut taxes to stimulate the economy and raise revenues in the process, eliminating the budget deficit and national debt and making us all prosperous.


So what happened? Well, the economy did surge, though due as much to Reagan abandoning any plan to stop spending (according to David Stockman, his own budget chief) as to the tax cuts. The annual deficits surged. The national debt we hand to our kids soared from less than $1 trillion over the first 204 years of our nation to around $10 trillion today.


Not only did official spending and annual deficits soar, politicians learned to take wars and other pet projects 'off budget.' And most of them share the blame, though we did best under Bill Clinton and a GOP Congress, and worst under George Bush and a GOP Congress, in terms of fiscal responsibility.


But we're buried in freaking deep by now. More than one in four dollars we pay in taxes now goes for debt service, soon to be one in three. If our mortgaged nation were a mortgaged home, we'd turn in the key and let the creditors take in back.


Worse, perhaps, is how this national lack of responsibility seemed to impact the business world. The tech bubble, the housing bubble, cdos, etc., etc., all fed by an orgy of debt helped along by federal action to eliminate the rules that kept business from sinking into the same hole.

Which would be fine, except that they also got permission to lie about it to investors, and funneled more and more of our retirement dollars into these sinkholes.

This has all come crashing down lately. And it's now pretty clear that the age of 'conservative,' Laffer economics was really an age of debt. What we thought of as prosperity was really just the thrill a gullible college kid might feel when the first credit card arrives in the mail.

You have fun buying rounds for a night or two, then regret it when the bill arrives.

As a nation, we've gotten the bill. And conservative tax-bashers are going to choke when they realize that, yes, we really all have to pay.