The teachers provide us with a teaching moment, over at WaPo. Their actions pose a stark reminder of the essential need for a strong, organized movement to push back on the forces promoting inequality, non-representative government, trickle down tax policy, and more.
CBO released their updated “baseline,” or estimate of the US gov’t’s fiscal outlook. If you like red ink, you’re in biz. Instead of deficits between 3 and 4% of GDP over the next few years, we’re looking at deficits of 4-5%.
As I’ve written in many places, when you’re closing in on full employment, you want your deficit/GDP to come down and your debt/GDP to stabilize and then fall. It’s not that I worry about “crowd out” so much–public borrowing hasn’t crowded out private borrowing for a long time, as evidenced by low, stable interest rates (rates are climbing off the mat a bit now, as I’d expect at this stage of the expansion).
It’s a) there’s a recession out there somewhere are we lack the perceived fiscal space to deal with it, and b) the larger point that this is all part and parcel of the strategy to starve the Treasury of revenues so as to force entitlement cuts.
Which brings me to this oped by a group of former Democratic chairs of the president’s CEA. It’s a perfectly reasonable call for a balanced approach to meeting our fiscal challenges, and, again, consistent with my view that as we close in on full employment, the deficit should move toward primary balance (another way of saying debt/GDP stabilization).
But two things from this piece, which is a critical response to an earlier oped by a “group of distinguished economists from the Hoover Institution.”
First, I didn’t realize that the Hoover’ites argued that the “entitlements are the sole cause of the problem, while the budget-busting tax bill that was passed last year is described as a ‘good first step.’”
This puts them in direct violation of the Bernstein Rule: if you supported the tax cut, you can’t complain about the deficit.More ...
House Speaker Paul Ryan (R-WI) is on his way out the door.
But while he’s largely failed to implement his vision before retirement — that is, to repeal Obamacare and privatize every safety-net program there is — Republicans aren’t going to stop trying to do so anytime soon. In fact, they’ll likely take cues from his record.
Throughout his time in Washington, Ryan built a career on portraying himself as a deficit hawk, somehow convincing people he’s some great wonk. In 2012, The New York Times’s James Stewart praised Ryan, calling his approach to tax reform “eminently sensible.” Former Clinton administration budget chief, Alice Rivlin, called Ryan “smart and knowledgeable” and decided to partner with him on his quest to privatize Medicare, which failed.
But in reality, there’s nothing genius about a career spent trying to cut “entitlement reforms” — code for popular health programs like Medicare and Medicaid — to validate the notion that you’re a deficit hawk. Ryan has worked to scrap nearly every safety net program in existence, while ignoring the deficit.
His most ambitious proposal — to privatize Social Security — demonstrated he was too radical for even the Bush administration.
But that didn’t stop him. While you can’t call Ryan a moderate, you can call him ambitious, even tenacious.More ...