Tuesday, February 15, 2011

I Can't Hear You

Alexander Hart writing that the states are in trouble and could use some help from the feds in dealing with their budget crisis or else many workers will be laid off. He makes a good case, but this is the type of plausible policy that has no chance of even being heard without a serious long range plan to address the budget deficit along the lines of what the Debt Commission proposed.

You could credibly say, we are doing the hard part on addressing the true nature of the long run deficit (health care costs, tax reform, and to a lesser extent Social Security and Defense) and in the interim we must help the states. On the path to a balanced budget you could say we must invest in (education, energy, infrastructure, etc) and people could hear you out, but without a credible plan to address the long range deficit people will just stick their fingers in the ears and sing loudly like you did when you were a kid and you thought the noise under your bed might be a monster.

  • This is why progressives have more at stake than conservatives in developing a balanced budget; because we believe government has an important role to play in society.
  • It looks like we are headed for the worst possible policy outcome regarding the deficit, cuts in the short run and inaction on the real problem.
  • It is a really bad idea to wait for a crisis to address the hardest issue, there will be fewer options left and progressive priorities will be at more risk under that type of scenario.
  • I have been saying only the President could lead with his budget on the hardest stuff, I hope I am wrong and the Senate picks up the ball and then the President jumps in.
  • Bubbles of a secret deal, but that seem far fetched.
That said, if we ever develop a reasonable (taxes up, spending down) long range plan to address the deficit and develop a sustainable federal budget, the last political step will include members of both parties passing a bill that is akin to their holding hands (and both sides holding their noses) and jumping off a cliff together. Seems like the most likely outcome is no deal on the long range problems (and short term cuts; the worst possible outcome). But, a big deal on the long range problems seems more likely than a small one.

update: interesting take on grand bargains from Matt Yglesias. Andrew Sullivan saying you can be pissed but still support the President.

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