Can't We Kill the Deficit Hawk Industry?
Yes, I know Peter Peterson is a major source of employment in Washington and that the Washington Post editors and many pundits would have to look for substantive issues to talk about if they couldn't whine about the debt, but really it is time for these folks to grow up. The immediate provocation here is Steven Rattner's NYT column giving "2016 in Charts."
Most of the charts are actually quite interesting and useful, but then he ends the piece with a tirade about the prospects for the national debt under a Trump administration. Rattner warns:
"These huge tax giveaways -- along with Mr. Trump's promises to increase infrastructure spending and not touch Social Security and Medicare -- would blow up the deficit and add $4 trillion to the national debt over the next 10 years over and above current projections."
Just to be clear, there is no reason to be giving more money to Donald Trump's billionaire friends as he proposes, but the argument is not that it will "blow up" the deficit and add to the debt. The argument is that this money could be much better used educating our children, improving our infrastructure, and making health care affordable, among other things.
The debt stuff is just silliness that we really need to get over. The problem of an actually excessive debt would show itself in high interest rates and high inflation rates. Have you checked those measures lately? Long-term interest rates are still way below their levels from the late 1990s when the government was running surpluses. And inflation remains persistently below the Fed's 2.0 percent target and in recent months has edged downward. (And, for those keeping score at home, the government's ratio of interest payments to GDP is near a post-World War II low.)
Furthermore, the whole focus on the debt encourages sloppy thinking that has no place in serious policy discussions. The government makes obligations for us all the time that don't take the form of explicit debt. Donald Trump wants to have private companies spend a trillion dollars building infrastructure that they will then recoup in tolls. How do these tolls differ from taxes? So we would be doing bad things to our kids if we financed infrastructure with debt, but then taxed to repay the bonds, but if private companies charge the same amount (most likely much more) in tolls, everything is cool?
To take a much more important example, grants of patent and copyright monopolies are ways in which the government finances innovation and creative work. We pay $430 billion a year for prescription drugs that would likely cost around $60 billion in a free market without patents and related protection. (Yes, you can read more in my [free] book, Rigged.) If the government imposed a tax of $370 billion a year on drugs being sold in a free market the deficit hawks would be yelling and screaming about high taxes, but when we give drug companies a legal monopoly so that they can add this amount to the price of drugs it's no big deal?
Okay, this is just silliness. We need discussions of the economy that are serious. When people scream about debt and deficits they are not being serious. The national debt is not a real measure of anything and folks should know that even if the "experts" don't.
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This country and this world are at a monumental crossroads. US voters have an opportunity to beat back the forces of fascism and confront the billionaires who are rigging the economy, our media system, and our democracy, making it increasingly impossible for ordinary people to get by. We’re not just talking about the election. We’re talking about what must be done once these fascist elements are vanquished from power. We need a bolder set of solutions than what either major party has so far been willing to offer and a working-class movement ready to fight like hell for it. Trump didn't emerge from nowhere. The conditions that fueled MAGA authoritarianism were created by decades of radical neoliberal economic policies and a corrupt political system dominated by corporate interests. They slashed taxes on the super-rich, promising that the benefits would trickle down. They said giveaways to the corporate titans would make life more affordable for the rest of us. It was all bullshit. And when a bitter, betrayed populace searches for someone to blame, right-wing demagogues have little trouble finding scapegoats. People know when they're being lied to, but you won't hear any of this from the corporate media. Only independent journalism—powered and funded by people who believe in building a better world—can deliver truly trustworthy daily news. Our Fall Campaign is underway, and we need your help. To power our newsroom through the rest of the year, we need to raise $125,000 by midnight on October 31. So if you share our vision, please contribute whatever you can to sustain our work. |
Yes, I know Peter Peterson is a major source of employment in Washington and that the Washington Post editors and many pundits would have to look for substantive issues to talk about if they couldn't whine about the debt, but really it is time for these folks to grow up. The immediate provocation here is Steven Rattner's NYT column giving "2016 in Charts."
Most of the charts are actually quite interesting and useful, but then he ends the piece with a tirade about the prospects for the national debt under a Trump administration. Rattner warns:
"These huge tax giveaways -- along with Mr. Trump's promises to increase infrastructure spending and not touch Social Security and Medicare -- would blow up the deficit and add $4 trillion to the national debt over the next 10 years over and above current projections."
Just to be clear, there is no reason to be giving more money to Donald Trump's billionaire friends as he proposes, but the argument is not that it will "blow up" the deficit and add to the debt. The argument is that this money could be much better used educating our children, improving our infrastructure, and making health care affordable, among other things.
The debt stuff is just silliness that we really need to get over. The problem of an actually excessive debt would show itself in high interest rates and high inflation rates. Have you checked those measures lately? Long-term interest rates are still way below their levels from the late 1990s when the government was running surpluses. And inflation remains persistently below the Fed's 2.0 percent target and in recent months has edged downward. (And, for those keeping score at home, the government's ratio of interest payments to GDP is near a post-World War II low.)
Furthermore, the whole focus on the debt encourages sloppy thinking that has no place in serious policy discussions. The government makes obligations for us all the time that don't take the form of explicit debt. Donald Trump wants to have private companies spend a trillion dollars building infrastructure that they will then recoup in tolls. How do these tolls differ from taxes? So we would be doing bad things to our kids if we financed infrastructure with debt, but then taxed to repay the bonds, but if private companies charge the same amount (most likely much more) in tolls, everything is cool?
To take a much more important example, grants of patent and copyright monopolies are ways in which the government finances innovation and creative work. We pay $430 billion a year for prescription drugs that would likely cost around $60 billion in a free market without patents and related protection. (Yes, you can read more in my [free] book, Rigged.) If the government imposed a tax of $370 billion a year on drugs being sold in a free market the deficit hawks would be yelling and screaming about high taxes, but when we give drug companies a legal monopoly so that they can add this amount to the price of drugs it's no big deal?
Okay, this is just silliness. We need discussions of the economy that are serious. When people scream about debt and deficits they are not being serious. The national debt is not a real measure of anything and folks should know that even if the "experts" don't.
Yes, I know Peter Peterson is a major source of employment in Washington and that the Washington Post editors and many pundits would have to look for substantive issues to talk about if they couldn't whine about the debt, but really it is time for these folks to grow up. The immediate provocation here is Steven Rattner's NYT column giving "2016 in Charts."
Most of the charts are actually quite interesting and useful, but then he ends the piece with a tirade about the prospects for the national debt under a Trump administration. Rattner warns:
"These huge tax giveaways -- along with Mr. Trump's promises to increase infrastructure spending and not touch Social Security and Medicare -- would blow up the deficit and add $4 trillion to the national debt over the next 10 years over and above current projections."
Just to be clear, there is no reason to be giving more money to Donald Trump's billionaire friends as he proposes, but the argument is not that it will "blow up" the deficit and add to the debt. The argument is that this money could be much better used educating our children, improving our infrastructure, and making health care affordable, among other things.
The debt stuff is just silliness that we really need to get over. The problem of an actually excessive debt would show itself in high interest rates and high inflation rates. Have you checked those measures lately? Long-term interest rates are still way below their levels from the late 1990s when the government was running surpluses. And inflation remains persistently below the Fed's 2.0 percent target and in recent months has edged downward. (And, for those keeping score at home, the government's ratio of interest payments to GDP is near a post-World War II low.)
Furthermore, the whole focus on the debt encourages sloppy thinking that has no place in serious policy discussions. The government makes obligations for us all the time that don't take the form of explicit debt. Donald Trump wants to have private companies spend a trillion dollars building infrastructure that they will then recoup in tolls. How do these tolls differ from taxes? So we would be doing bad things to our kids if we financed infrastructure with debt, but then taxed to repay the bonds, but if private companies charge the same amount (most likely much more) in tolls, everything is cool?
To take a much more important example, grants of patent and copyright monopolies are ways in which the government finances innovation and creative work. We pay $430 billion a year for prescription drugs that would likely cost around $60 billion in a free market without patents and related protection. (Yes, you can read more in my [free] book, Rigged.) If the government imposed a tax of $370 billion a year on drugs being sold in a free market the deficit hawks would be yelling and screaming about high taxes, but when we give drug companies a legal monopoly so that they can add this amount to the price of drugs it's no big deal?
Okay, this is just silliness. We need discussions of the economy that are serious. When people scream about debt and deficits they are not being serious. The national debt is not a real measure of anything and folks should know that even if the "experts" don't.