It’s absolutely wonderful to be back writing for Roosevelt Talk. I’d also like to welcome you all to our newest series which will spend a couple blog posts pouring through the Congressional Progressive Caucus’s (CPC’s) newest budget, the Better Off Budget. Before I start the main part of the series, I wanted to give you all an overview of the kinds of things we’ll be covering as well as some background information.
Each year, the CPC releases its own budget to add its voice to the chorus. Unfortunately, it’s also ignored each and every year. The media generally focus on the plans released by the President and House Republicans, most notable of whom is the House Budget Committee Chairman, Paul Ryan (R). Ever since 2010, Ryan has released a series of budget plans, the most notable of which was his infamous Path to Prosperity, that have come to symbolize the Congressional Republican’s vision should they gain control of Congress and the Presidency in the near future. It was in these budgets that Ryan proposed a massive tax reform overhaul that would have drastically slashed rates and combined them into two separate brackets. It was also where he outlined his extremely controversial plan to turn Medicare into a privatized voucher system. Note that Republicans would dispute that characterization and instead tried the euphemism, “premium support.” You tell me if they sound different. Besides those two, it included the draconian cuts to social welfare programs that earned Paul criticism and fame as the Republican’s go-to budget wonk.
On the opposite side, stands President Obama. His budget plans have been fairly generic in the sense that they haven’t changed much since he took office. His initial budgets were based largely around the American Recovery and Reinvestment Act.The reason I don’t focus on the President nearly as much as Ryan or the CPC is simply because his subsequent proposals have not called for any radical changes from what he started with. They incorporated and produced minor appropriation changes to his major legislative initiatives (successful or not) such as Dodd-Frank, Obamacare, the payroll tax cut, the Buffet Rule, defense cuts, the sequester, etc.
The one thing I will note about the President, and this is true of D.C. in a larger sense, is that his focus following 2010 shifted from stimulating the economy to retrenching spending and curbing the deficits. In a global sense, the same thing was occurring with austerity fever in Europe. We in the United States haven’t had it nearly as bad and our efforts were termed “austerity-lite” by the Economist until the sequester took an even bigger whack at the budget in 2013.
It’s this shift that has to change. The budget deficit dropped at its fastest rate since World War II following the sequester but the American economy clearly isn’t in any sort of healthy state. Labor force participation is pitifully low compared to statistics from “better” times. Banks and companies are still sitting on mountains of capital to pay off old debts accrued during boom times and consumers are still not willing to spend enough to bring us back into a full swing recovery because they’re stuck with housing, medical, credit card, and student loan debts. Larry Summers took one look at the situation and termed it secular stagnation. None of the budgets put forward by the President, not to mention the House Republicans, come anywhere close to addressing these problems.
As the writer behind the CPC series, I will admit I have my fiscal preferences. The United States Federal Government is the only entity that can spend in this economy whilst consumers and private enterprises are occupied with savings. Retrenching spending, especially on programs that already received lackluster attention for the past decade, will only make things worse. Tax hikes won’t do us much good either. The deficit can only be fixed in the context of a good economy. Otherwise its the government’s responsibility to be the “spender of last resort.”
There I said it. That viewpoint is the reason the CPC’s budget intrigued me as much as it did. I will use this series to analyze the Better Off Budget’s policy alternatives. Full disclosure: I have my doubts and I fully understand that the current political climate means the budget is certainly DOA (dead on arrival). But it’s worth exploring don’t you think?
I think so too. Now, that I’ve given you the context, I’ll be able to dive straight into the details next time. Till then!