James Pethokoukis

Politics and policy from inside Washington

Ignore Geithner’s debt ceiling scare tactics

May 16, 2011 18:00 UTC

To employ the phrasing of Gov. Chris Christie, America hit the debt ceiling and didn’t vaporize. New borrowing has put the U.S. Treasury right up against its $14.3 trillion borrowing limit, but financial markets aren’t crashing over fear that this will lead to default.

So, given that non-reaction so far, just who is the Treasury Secretary kidding? This whole fear-fest over the U.S. debt ceiling is starting to resemble the bank bailout in 2008 when warnings of financial apocalypse shoved Congress into approving TARP. Here is how Timothy Geithner put it in a  letter to Sen. Michael Bennet:

Failure to raise the debt limit would force the United States to default on these obligations. … A default would inflict catastrophic, far-reaching damage on our nation’s economy, significantly reducing growth, and increasing unemployment. … Default would not only increase borrowing costs for the federal government, but also for families, businesses and local governments. … Default would also have the perverse effect of increasing our government’s debt burden. … It would increase rates on Treasury securities, which would increase the cost of paying interest on the national debt.

But why, exactly? There is no reason for the U.S. to miss a debt payment, even after the supposed Aug. 2 deadline. Team Geithner has plenty of flexibility about which bills to pay and plenty of dough with which to do it. Here is economist Ed Yardeni:

Over the past 12 months through April, net interest expense of the federal government was $213.1 billion. Will there be no money to make these payments if the debt ceiling isn’t raised? There will be plenty. Over the past 12 months through April, the Treasury collected $2.27 trillion in revenues. In April alone, when individual tax returns are due, revenues totaled $289.5 billion, a bigger than expected gain, confirming that the economy recovered smartly over the past year.

It would be criminally insane for the Treasury to stop making interest payments on our debt just because Congress failed to agree on raising the ceiling when the revenues are certainly available to make the payments and auctions will continue to rollover maturing debt. It is insane for administration officials to suggest otherwise.

And just how badly would markets take it anyway if there was a temporary payment delay but the result was a deal which significantly cut spending today and capped spending tomorrow? Famed investor Stanley Druckenmiller is willing to take his chances:

Here are your two options: piece of paper number one—let’s just call it a 10-year Treasury. So I own this piece of paper. I get an income stream obviously over 10 years . . . and one of my interest payments is going to be delayed, I don’t know, six days, eight days, 15 days, but I know I’m going to get it. There’s not a doubt in my mind that it’s not going to pay, but it’s going to be delayed. But in exchange for that, let’s suppose I know I’m going to get massive cuts in entitlements and the government is going to get their house in order so my payments seven, eight, nine, 10 years out are much more assured,” he says.

Then there’s “piece of paper number two,” he says, under a scenario in which the debt limit is quickly raised to avoid any possible disruption in payments. “I don’t have to wait six, eight, or 10 days for one of my many payments over 10 years. I get it on time. But we’re going to continue to pile up trillions of dollars of debt and I may have a Greek situation on my hands in six or seven years. Now as an owner, which piece of paper do I want to own? To me it’s a no-brainer. It’s piece of paper number one.

The White House would love a clean up-or-down vote on raising the debt ceiling. But David Walker, the hawkish former U.S. comptroller general said this today:

While the debt ceiling must be increased, any extension should include appropriate conditions to reduce short-term spending while also addressing the huge structural deficits that lie ahead. This should involve bringing back tough statutory budget controls, including new debt-to-GDP targets with automatic enforcement mechanisms beginning in 2013. Adopting a number of initial steps designed to reduce direct spending and tax expenditures as down payments to meet the new target would also be appropriate.

We must not allow what has already happened in Greece and Ireland to happen in the U.S. No one really knows when the markets will lose confidence in the willingness and ability of the federal government to put its finances in order. If it does, we will see a sudden and dramatic increase in interest rates that will only increase our already serious economic, fiscal and unemployment challenges.

The debt ceiling provides an opportunity to make a big dent in America’s dangerous debt situation.  Not taking advantage of this moment is what scares me.


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2012 might be one deal Romney can’t close

May 13, 2011 16:57 UTC

During his private equity career, Mitt Romney was famous as a supersalesman who could dazzle clients with data. But his PowerPoint mastery may not be enough to make him U.S. president. Thursday’s slide-show defense of the controversial health plan he created as Massachusetts governor likely failed to satisfy conservative critics.

Judged purely as political theater, the hour-long, televised presentation Romney gave at the University of Michigan was impressive. The faltering Republican frontrunner speedily navigated through the healthcare problems facing the Bay State when he took office and how he went about devising a solution. He explained that before his 2004 reforms, almost a half million state residents were uninsured. Now it’s down to 100,000 thanks to the government programs he started, Romney said. And he didn’t need to raise taxes to do it. Few of his 2012 rivals can match his policy knowledge.

Right-wing Republicans didn’t consider Romneycare as a disqualifier when the former Bain Capital chief ran for the party’s nomination back in 2008. But it’s Romney’s bad luck that a key feature of his healthcare plan can also be found in President Barack Obama’s: a requirement all citizens purchase health insurance if they can afford it. A decade ago, some conservatives pushed the idea as a matter of “personal responsibility.” And as smart economics, too. They saw it as a way of stopping a free-rider problem since American emergency rooms will treat whomever walks through their doors.

In the more libertarian Tea Party GOP of 2011, however, the “individual mandate” is considered a grievous breach of personal liberty, whether it applies at the state level or federal. Indeed, the rule’s constitutionally is the heart of legal challenges to Obamacare. And Romney’s continued support for his version has seriously damaged his White House prospects. To conservative activists, it’s about values not economic results. His deluge of numbers, no matter how elegantly displayed, is politically irrelevant.

Romney, well financed and with a crack campaign team behind him, could still be the nominee. Some voters will surely like that he’s sticking to his guns. But if someday Romney gives a PowerPoint on how he failed to win the GOP nod in 2012, there’s no doubt what will be on that first slide.



You may think you’ll see a rather clear and obvious correlation to those rising costs and the time in which the federal gov’t stuck their noses into the healthcare system–but you would have it backwards. Healthcare costs began to rise as the “market” for healthcare was given over to private hospitals, private health insurance companies, a protected pharmaceutical monopoly, and fee-for-service physicians.
Some free market. Racket is more like it.

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Romney: Values vs. data

May 12, 2011 17:48 UTC

A very tough WSJ editorial today looking at RomneyCare, but it was the summary that really caught me:

For a potential President whose core argument is that he knows how to revive free market economic growth, this amounts to a fatal flaw. Presidents lead by offering a vision for the country rooted in certain principles, not by promising a technocracy that runs on “data.” Mr. Romney’s highest principle seems to be faith in his own expertise.

More immediately for his Republican candidacy, the debate over ObamaCare and the larger entitlement state may be the central question of the 2012 election. On that question, Mr. Romney is compromised and not credible. If he does not change his message, he might as well try to knock off Joe Biden and get on the Obama ticket.

If a series of studies somehow (unlikely) showed that high taxes and nationalization of business would produce a higher standard of living, would I be for those policies? I would not, because that sort of society would be a far more oppressive one where a person would not be free to pursue happiness as he or she saw it.  While numbers should inform decisions, it’s not always about following the data wherever it takes you. Not at all. I remember talking with a libertarian econ professor who said he used to believe that his side “had the better studies.” As he got older, he became a bit less sure of that. But he also really didn’t care since at the core of cosmology was a belief in the value of freedom.


Talk about no factual argument given, just platitudes…

Tell us exactly how much money is going to pay exactly which commissars [or is it czars], which union kickbacks, which political favors, and which other graft. And be specific.

This is the usual spoon fed babble the ditto-bots get drummed into their little heads every day, two hours ever morning, and four hours every afternoon, followed by three hours of prime time, every single day.

So yes, let’s look at all the examples around the world, and compare them to America’s system. America treats healthcare as a risk, while the rest of the civilized word treats it as a cost. That’s why Americans pay twice as much for health services as the rest of the world, and get results that are no better.

There is no risk of getting sick. Disease does not care if people have health “insurance” or not. People get sick, they get care, and society pays the COST. Adding a layer of for-profit business to “manage the risk” is insanity.

And yet, Republicans are willing to spend whatever capital, political or otherwise, to protect this racket.

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Which party is at greater risk from a debt ceiling debacle?

May 12, 2011 14:58 UTC

Stu Rothenberg thinks there is plenty of danger to go around:

The nature of the Republican risk is obvious. If the GOP looks inflexible, excessively ideological and extreme, voters are likely to turn against it. This is more likely, of course, if Democrats look reasonable and emphasize their willingness to compromise. (Swing voters love the idea of compromise.) It’s also more likely if the most vocal and ideological elements of the GOP define their party.

But even partisan Democrats agree that their party faces a considerable risk if they look as if they are insufficiently committed to cutting spending. Indeed, merely by supporting an increase in the debt limit, Democrats play into an image that they are trying to change — that they are fiscally irresponsible.

This is why, some observers speculate, that if a “clean” vote on increasing the debt limit occurs soon (as some predict), large numbers of Democrats will vote against it. That would give ammunition to House Republicans, of course.

While Democrats surely would attempt to blame the GOP for a spike in interest rates due to a loss of confidence in the U.S. government’s reliability, it is far from clear that the president would avoid serious damage if the U.S. economy were to suffer from any chaos produced by the government reneging on its obligations.

Still, the only group of players that doesn’t appreciate the potential negative fallout from a deadlock is House Republicans, many of whom seem to think that failing to raise the debt limit wouldn’t be all that big of a deal. That view may well be delusional, but it gives them a great deal of power in any negotiations, since they don’t feel the pressure to act that others do.




There are societies that don’t see challenges coming, so they never take the time to develop solutions. There are other societies that see challenges coming, but they lack the skill and wherewithal to implement solutions. And then there are societies that see the challenges coming, know exactly how to respond, and still falter due to a dysfunctional political system that is sabotaged by misguided ideologues.

The near-collapse of the global economic system just happened. Wall Street isn’t exactly popular with the American mainstream, but Congressional Republicans don’t care, pursuing a strategy that would have been unthinkable just a few years ago. They’re counting on the public not knowing the difference, and the GOP is paying no price whatsoever for their financial industry antics.

The debt ceiling is not the only easily preventable crisis area in which the United States fails to act, due entirely to Republican intransigence and foolishness. We face a climate crisis, and extreme volatility in the energy sector, but the GOP refuses to consider sensible solutions even they supported a few years ago. If we don’t raise the debt ceiling, we risk a crisis of Congress’ own making. All because our political process has placed enormous power in the hands of incompetent ideologues who prefer inaction to action, and crisis to stability, even when the threat is staring us in the face.

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Cutting entitlement benefits to wealthier Americans

May 12, 2011 14:49 UTC

Good stuff on means testing from Charles Blahous over at e21:

As it happens, the two largest and fastest-growing areas of federal spending, Social Security and Medicare, are both ones for which the wealthiest Americans are fully eligible for rising benefits. Both programs are, to be sure, of extreme political sensitivity. But the financial imbalances in these two programs require correction by elected officials in any event. To the extent that spending on the wealthy is constrained within these programs, it will reduce the financial pressure for even more politically-sensitive changes to them.

1) The essence of what is required is for the two parties to agree on how many high-income individuals to affect, and on how much. Social Security provides a ready case study in how this could be done. Many Democrats, for example, have expressed sympathy with the concept of raising the current $106,800 limit on the amount of wages subject to the Social Security tax. Such a measure would affect roughly 20% of workers (the number who have wages above the current limit at some point in their careers). Legislators could therefore choose instead to slow the growth of benefits – perhaps for that same number of workers, or the top 20% of the wage spectrum.

How much should the growth of such benefits be slowed? It is not financially necessary to reduce Social Security benefits from current levels. Current Social Security proposals, for example, that employ “progressive indexing” would only impose price-indexation on less than 1% of workers, with everyone else receiving faster benefit growth. Limiting the highest-income 20% to inflation-adjusted benefits and allowing gradually faster growth for workers below that level could by itself eliminate well more than half of the entire Social Security shortfall.

2) As for Medicare, Democrats and Republicans fiercely disagree on whether cost containment is best achieved via a premium support model, or by the federal government’s imposing price controls within the program’s current design. But they do agree on the need for cost containment itself. Already certain features of federal health care law, such as the exemption from the “Cadillac plan tax” and the vouchers provided under the new health entitlement, will grow only with the Consumer Price Index (CPI), despite the fact that historically health cost inflation has exceeded economy-wide CPI. If it is politically acceptable to restrict these forms of federal health care support to CPI growth, surely Medicare direct spending on the highest-income beneficiaries could similarly be limited. (This cost containment could be achieved most neatly by changing the rate of growth for income-related Part B premiums so as to hold the growth rate for total Medicare per-capita expenditures to CPI for the highest-income beneficiaries).

3) Though these are the largest federal spending programs, and though most other direct spending is not targeted on the rich by any definition, savings from direct payments to higher-income individuals need not end there. Agriculture support payments, for example, are currently made to farmers with adjusted gross farm incomes as high as $750,000 (and allowing for an additional $500,000 in non-farm income). At a time when so many continue to struggle amid a weak economy, when federal finances are in desperate condition, and when many talk of the necessity of raising taxes on millionaires, it is difficult for taxpayers to understand why direct payments to millionaires continue. It is encouraging that reports on nascent bipartisan deficit talks indicate that such excessive farm subsidies are potentially on the chopping block.

A bipartisan effort to restrain entitlement spending on the rich will not draw unanimous praise. Some on the far left will see such reforms as part of an insidious plot to weaken popular support for cherished programs. But even objection from these quarters is potentially useful and informative. As a nation we must decide whether our loyalties attach to the programs in the abstract or to the individuals affected by them both as beneficiaries and as taxpayers. We need an informed debate over whether the costs of government should rise to unprecedented levels simply because of the political importance some might attach to buying the support of those who least need assistance.


First they came for the flash traders …

May 12, 2011 14:31 UTC

Democrats want to raise taxes on oil companies. They want to slap fees on high-frequency trading firms. And they want to raise taxes by$2 trillion over the next 10 years, including a 3 percent surcharge of millionaires.  All of which will solve nothing since we either need to radically restructure entitlements (such as through the Paul Ryan approach) or hit the middle class with broad new taxes (the true “progressive” approach which they will not fess up to.) For now, though, liberals are focusing on the easy targets for higher taxes: Big Oil, Wall Street and The Rich. But that is not where they will stop …


Really, using the start of a phrase that stated “First they went after the Communists” then “Trade Unions” and “Jews” (left-wing groups) as a statement about the evils of the Nazis to support a right wing agenda is not just classless, it belittles the evil that was Nazi Germany.

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Senate GOP’s budget proposal shows Dem attacks working

May 10, 2011 20:00 UTC

The “Restoring Balance” fiscal proposal created by Sen. Pat Toomey does lots of good things. Such as the following:

– balances the budget by fiscal year 2020 and achieves a modest surplus in fiscal year 2021.

– reduces publicly-held debt $4.7 trillion below the levels projected in the president’s plan.

– reduces publicly held debt to approximately 52 percent of GDP by 2021 vs. 68 percent for Paul Ryan’s budget plan.

– reduces publicly held debt to approximately 52 percent of GDP by2021 and lowers total spending to 18.5 percent of GDP. This budget spends approximately 3 percent less than the House-passed budget and 16 percent less than the president’ s budget with no changes to Social Security.


It achieves these things mostly by big, fast cuts to discretionary spending (including defense) and to Medicaid. Nothing wrong with that. But even Toomey concedes that it is not a comprehensive plan:

Restoring balance entails two distinct, but related, paths: near-term (discretionary and non-Medicare and Social Security entitlement spending) and long-term (Medicare and SocialSecurity). The first step must be to reduce discretionary spending and non-Medicare and SocialSecurity spending. This category of expenditures has been the primary driver of deficits over the last decade, and continuing to spend at such high rates precludes an effort to tackle the long-term challenges they present.

While Social Security, Medicare and Medicaid require structural reforms soon, it is neither necessary nor politically feasible to take them on all at once. Focusing on just the current 10-year budget window, this budget makes no changes to Social Security. Changes to Medicare are limited to restoring the fictitious and unspecified cuts projected in the president’s budget.

But it’s hard to look at this budget and not conclude that it reflects the success Democrats have had attacking the entitlement reforms in Rep. Paul Ryan’s Path to Prosperity.  The Toomey Plan leaves Social Security and Medicare alone. As a result, it ignores that debt problem beyond a decade out. (Nor does it have lots of comparison charts that make it easy for gin up political attacks.)  I have leveled the same criticism at Obama’s various budget “plans.”  Implementing the Toomey plan would be a huge step forward. But since the American social insurance system will eventually need to go the Ryan path or become a strict, command-and-control rationing system, better to make the case with confidence sooner rather than later. I am quite sure Toomey knows this, and perhaps if the Senate were filled with his clones, this new budget would reflect that.  But for now Republicans, at least those in the Senate, are not looking any further than the 2012 elections.


The Democrats aren’t lifting a finger. Republicans who went home and hald town halls got beaten up by their own constituents, not by Democrats. The GOP has gone off the rails, and nothing can haul that train back up the cliff. They will be spending another ten years in the wilderness, thanks to Grover Norquist, the Kochs, and the Heritage Foundation.

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Just how beatable is Obama?

May 10, 2011 18:46 UTC

Peter Wehner of Commentary gives the tale of the tape:

We are now in the fifth month of Barack Obama’s third year in office. Unemployment is at 9.0 percent. We’re about 7 million jobs short of where things stood when Obama took office. Economic growth in the first quarter was 1.8 percent. Housing prices have fallen for 57 consecutive months. Only one in three Americans approve of the way Obama is handling the economy, the lowest point since he took office, and nearly eight in 10 American are less optimistic about the economy than they were a few months ago.

David Axelrod is anxious, and he’s right to be. His friend, the president, is caught in a political tractor beam from which few, if any, public officials escape. The only way to likely to overcome it is if the economy shows signs of a strong recovery. That has yet to happen, and one cannot help but think it may never happen, in the Obama presidency. If that ends up being the case—if a year from now the economy is more or less in the same condition as it was two years ago, last year, and what it is now—Obama will be the easiest incumbent to beat since 1980. It’s not impossible for Republicans to lose such an election, but it would be mighty hard.

I would add in how higher gas and food prices are just flat out killing incomes.  But certainly if the next 15 months looks like the past five months, things would look quite promising for the GOP.


Barack Obama is as unbeatable as FDR was. Barack Obama is the greatest president we’ve had since FDR. His health care bill would have been enough to enshrine him in the “greatest presidents” club but when he killed Osama Bin Laden he moved himself into a unique category. No rerpublican stands a chance against Barack Obama. Mark Montgomery NYC, NY boboberg@nyc.rr.com

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Boehner really isn’t asking for that much to raise debt ceiling

May 10, 2011 18:19 UTC

On  its face, House Speaker John Boehner’s demand for perhaps more than $2 trillion in spending cuts may look like a dangerous escalation in the political battle over raising the federal debt ceiling by a similar amount. But the reductions would be over 10 years, they’d be in line with several budget proposals, and they would represent only a modest down payment on austerity.

A group of Wall Street executives and other business leaders  listening to Boehner on Monday evening in Manhattan seemed unenthusiastic. They would almost certainly prefer to disentangle the issue of expanding the federal borrowing authority — and thus avoid even the whiff of possible default — from how best to deal with America’s long-term deficit and debt problems. After all, both parties have agreed on a budget that requires more borrowing next year. That is the White House position, too. “To hold one hostage to the other remains extremely unwise,” spokesman Jay Carney told reporters today on Air Force One as Obama flew to Texas.

But, thankfully, politics keeps pushing the two issues together. The powerful Tea Party wing of the GOP wants party leaders to get something substantial in return for enabling more Treasury borrowing. That might include some or all of congressional approval of a balanced budget requirement, a legislative cap on future federal spending, and deep budget cuts. Boehner’s speech certainly gave the impression he’s on the same page. “The cuts should be greater than the accompanying increase in debt authority the president is given,” he said.

Treasury Secretary Timothy Geithner may want as much as $2 trillion in new borrowing capacity through 2012. It’s not a small number, but matching that with cuts over 10 years is manageable. President Barack Obama’s debt commission called for $2.2 trillion over a decade, while his own recent budget proposal contemplates reductions almost as large. And if defense cuts are in the mix, as Boehner implied, it all could be done without touching Medicare and Social Security outlays.

Of course Democrats want to see increases in tax revenue as well as spending cuts. The elements of the Republicans’ three-part package, meanwhile, would force greater fiscal discipline on this and future administrations. Failure to do a deal could lead to a series of repetitive fights over temporary, even monthly, debt limit increases up until the 2012 elections. That won’t suit Wall Streeters, so they should hope Boehner’s equation can accommodate a compromise.



Just remember that this is the same Republican Party that wants to gut medicare and honestly believes that private companies will rein in healthcare costs. These are the people that brought us the Iraq war. Do we really want them back in the driver’s seat? Maybe we do. Maybe we haven’t had enough economic distress, social stagnation and loss of American lives in stupid wars to feel the great sense of satisfaction that they obviously feel for themselves. Oh yes, give it to us, GOP, give us your brilliant ideas and your wonderful future of bread lines and sixth-grade education for all!

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The fantastic assumptions of the “The People’s Budget” by House Democrats

May 9, 2011 15:25 UTC

What’s the true opposite of Rep. Paul Ryan’s “Path to Prosperity” budget plan?  Well, there’s the Obama “Framework,” but that is little more than a speech and a bunch of bullet points.  For a more serious and comprehensive liberal response, take a look at the “People’s Budget” produced by the Congressional Progressive Caucus.

Here’s the short version of the plan: It claims to achieve primary balance (not counting interest costs) by 2014 and overall balance by 2021. It does this via huge tax hikes (on income, corporate profits and investments) and by cutting defense spending by $2.3 trillion over a decade – and then shifting $1.7 trillion of those savings into nondefense outlays.  Those nearly $2 trillion in new “investments” would boost the growth potential of the economy by 0.3 percentage point per year over the next decade. Or so the CPC and the Economic Policy Institute claims.

The economic consulting firm Macroeconomic Advisers is dubious, to say the least, that the Peoples’ Budget would boost growth rather than kill it. Among its criticisms (as excerpted by me):

1) The analysis ignores near-term fiscal drag sure to arise if the plan is implemented when the Federal Open Market Committee has little room to accommodate a strong fiscal contraction.

2) Nor does it even mention the potential deleterious supply-side effects of raising marginal tax rates

3) The $1.7 trillion is nominal, not real, spending. Furthermore, in the CBO baseline inflation averages 2% per year. Adjusting for inflation reduces the $1.7 trillion in current dollars to $1.5 trillion in 2005 dollars.

4) This is gross investment, some of which depreciates away over time. The average or effective depreciation rate on private nonresidential fixed capital is about 7.5% per year. Assuming this rate of depreciation, and then accumulating the real gross investment flows by perpetual inventory into a net stock leads to an increase of roughly $0.7 trillion in the level of the real capital stock over the coming decade.

5) In our own long-run forecast, the real private nonresidential capital stock is roughly $21 trillion at the end of 2021, of which $0.7 trillion would represent an increase of about 3%.

6) This is for the private nonfarm business sector, which accounts for only three-fourths of total GDP. Hence the impact on the level of GDP at the end of ten years would be 0.75 times 1%, or 0.75%.

7)  When this increase is spread over ten years, the average impact on growth is less than 0.1 percentage point per year, or only about a third of the impact the EPI analysis suggests would result from the federal government spending the same amount of money on nondefense activities.

But wait, there’s more:

There are additional reasons to be suspicious. Much of the literature estimating the return to public investments focuses on the productivity of tangible investment like infrastructure, in part because there are data on the tangible public capital stock that facilitate such research. However, of the $1.7 trillion of new nondefense spending proposed in the People’s Budget, only $0.2 billion is specifically earmarked for physical infrastructure that would be included in official estimates of the public capital stock. The remaining $1.5 trillion is for “job creation, education, clean energy and broadband infrastructure, housing, and R&D.” Our National Accounts would count almost all of this either as current consumption or current transfers, not gross investment, and certainly there must be some consumption element in such spending. Do we really think that an increase in “foreign assistance” delivers the same productivity gain as expanding or repairing the inter-state highway system?

In addition, the analysis doesn’t argue that the $2.3 trillion of cuts in defense spending are a reduction in public investment that reduces economic growth. In essence, the EPI analysis implies that, at the margin, nondefense spending is all investment but that defense spending is all consumption. Both sides of this proposition might be closer to the truth than not, but if some nondefense spending is consumption and some defense spending is investment, the EPI calculus on the growth effects of the People’s Budget can be quickly undermined.[7] Suppose, for example, that 75% of the extra nondefense outlays really are new investments, but that 25% of the proposed savings in the defense budget actually reflects cuts in public investment. Then, the net change in public investment is reduced from the $1.7 trillion advanced in the People’s Budget to just $0.7 trillion (=.75*$1.7 trillion – .25*$2.3 trillion).



Fine fine. I don’t doubt all these numbers. That’s why it’s called a *Peoples’ Budget*, not a real budget and don’t forget, it was put together by the *Progressive Caucus*. Lefties never give up. A simple laugh and a wave of the hand at this budget proposal would have been adequate.

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