October 31, 2014

The (Tab)ulation

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Thursday, October 6, 2011 - 9:39 AM

NOTE: an earlier version of this post appears on EconomistMom.com

It would seem we have heard this so many times before that we shouldn't need to hear it again. The U.S. faces two major economic challenges at the same time: (1) an economy still desperately struggling to get out of (or avoid falling back into) recession; and (2) a fiscal outlook on such an unsustainable longer-term path that it threatens our near-term, and not just longer-term, economic health. The first is mostly a "lack of demand" problem, and the second is more about failing to keep up the supply of productive resources in our economy. The two challenges are very different and might suggest very different policy strategies, but we really can and should address both. We've heard this ("we can do both") principle many times before, but it always helps when someone as prominent as the Chair of the Federal Reserve Board makes it crystal clear in his written and oral (and official) remarks. From Bernanke's testimony before the...

Tuesday, September 27, 2011 - 7:49 AM

The “dynamic scoring” debate is back again. Last week the House Ways and Means Committee—chaired by Dave Camp (R-MI), who also happens to be a member of the debt-limit deal’s “super committee”—held a hearing on the subject, calling on the Joint Committee on Taxation’s chief of staff, economist Tom Barthold, to explain why that committee still estimates the revenue effects of tax legislation using “static” methods.

The Washington Post’s Lori Montgomery reported on this “old battle,” wondering out loud whether the super committee will resort to dynamic scoring as a “magic elixir that greases the skids to a more far-reaching compromise.”

Well, unfortunately for certain policymakers, dynamic scoring is not so magical.

“Dynamic scoring” refers to revenue estimates that would be...

Monday, September 19, 2011 - 12:00 AM

President Obama deserves credit for putting Medicare and Medicaid on the table for deficit-reduction efforts and for encouraging the new super committee to exceed its assigned goal. But the President’s  new proposals to that panel, released today, fall short of comprehensive structural reform in health care and tax policy, and his decision to leave Social Security out of the plan is disappointing as well.

Amid growing concerns about a double-dip recession, the administration has focused this month largely on short-term measures to support the economy. These measures should not preclude putting long-term deficit reduction plans in place, and in fact such plans can dramatically boost the effectiveness of the short-term initiatives.

So Obama’s suggestion that Washington proceed on both the short- and long-term fronts is welcome.  So is his willingness to discuss changes in Medicare and Medicaid, two of the federal government’s largest and most rapidly growing programs. Significant changes will be needed in those programs  if the nation is to have any hope of eventually putting itself on a more responsible and sustainable fiscal course.

The proposals to change other mandatory spending programs, such as cutting agriculture subsidies and increased cost-sharing in...

Thursday, September 8, 2011 - 12:00 AM

It is not inconsistent to provide effective short-term support for the economic recovery while laying the groundwork for long-term deficit reduction. To do so, however, Washington will have to move beyond the inflexibility and partisan vitriol of the recent debt limit debate.

President Obama took some helpful steps in this direction in his speech to Congress this evening. He offered several short-term proposals that could conceivably provide both an economic boost and a basis for bipartisan cooperation – which are together essential ingredients for effective fiscal policy and for repairing some of the damage that the debt limit debate inflicted on public confidence.
 
A full evaluation of the President’s plan, however, will need to take into account the ideas he will release later for paying for his new proposals and moving the federal budget toward a sustainable path. A credible plan to stabilize the debt over the long term will be essential to making short-term measures more effective. It is not just a matter of making the numbers work; it is sound economics.

As The Concord Coalition has long argued, “fiscally responsible deficit spending” need not be an oxymoron. During periods of economic difficulty when deficit spending may be required, the key is to ensure that the country gets the...
Monday, August 22, 2011 - 2:12 PM

I heard from a long time Concord Coalition volunteer that some members of the joint congressional committee tasked with finding at least $1.5 trillion in deficit reductions over the next 10 years -- who are, as you might guess, being inundated with suggestions and ideas -- are only interested in hearing from their own home state and district constituents.  

This is unfortunate and another example of why the public must be the 13th Super Committee Member.  

The 12 members of this “Super Committee” have an opportunity to make a significant impact on our fiscal future, and, with that, they have been given great power to do so.  

The Super Committee is charged with submitting legislation to both chambers of Congress, which will be subject to an up or down vote -- no amendments.  So, the agreement reached by these committee members can have a long-lasting impact on our nation’s fiscal policy.

Those policies will affect every American.  The decisions this committee makes on revenues, entitlement spending and defense spending, will not be limited to only those represented by individuals on this committee or those living in a particular congressional district.  

We are all in this together, and we all deserve our say.  

The Concord Coalition is asking you and all...

Wednesday, August 17, 2011 - 1:23 PM

The “no new taxes” pledge taken by Republicans in Congress has been a huge obstacle to achieving bipartisan agreement on a comprehensive deficit reduction plan. Many Republicans interpret the pledge as ruling out revenue increases of any kind, even those that close narrow loopholes and special interest deductions. The devotion seems to extend to a “grand bargain” for deficit reduction that would actually enact future cuts in tax rates, but pay for some of the revenue loss from those cuts by limiting deductions and loopholes.

However, it is encouraging that some of the newly appointed Republican members of the debt limit deal’s super committee have already indicated a refreshing openness to considering this approach. Congressman Fred Upton (R-MI) recently told a group of constituents that “tax reform is long overdue” and that he is “not afraid of looking at tax loopholes” in finding common ground on deficit reduction. And, Congressman Dave Camp -- a Republican super committee member from Michigan who also chairs the tax-writing House Ways and Means Committee -- when questioned about tax increases has said that “nothing is...

Tuesday, August 16, 2011 - 3:09 PM

The Concord Coalition is calling upon the 12 members of the Congressional Super Committee to include a critical 13th member in their deliberations -- you. As we discussed in yesterday's post, The American People Want In, the Committee’s decisions will affect every American so it’s only right that every American has a voice in their deliberations.  

Let your voice be heard and demand that members of the Super Committee engage the American people in a dialogue about the tough choices America faces.  The issues at stake -- from social insurance to national security, domestic investments and tax reform -- have profound consequences for our nation. This is your chance to weigh in.

The Super Committee’s Thanksgiving deadline means that time is short, so your participation now is critical. Don’t let this opportunity to help decide America’s fiscal future pass you by. 


Here’s what you can do:

1. Contact Super Committee members and tell them, “Listen to the American people, and put all options on the table.”
...
Monday, August 15, 2011 - 12:00 AM

 

This post originally appeared on The American Square

Twelve official members of the new joint congressional committee charged with reducing federal budget deficits by $1.5 trillion over the next 10 years have been named. What remains to be seen is whether an unofficial, but crucial, 13th member will be included in the committee’s deliberation – the American public.

Most of the deficit reduction negotiations this year have taken place behind closed doors and none of it has gone beyond Washington horse-trading to engage the public in any meaningful way. Exchanging shop-worn, poll-tested talking points on cable TV is not “public engagement.”

We watched the debt ceiling debate with horror as politicians played “Chicken” with our nation’s creditworthiness. Business leaders warned that the possibility of default, in one form or another, would create a ripple effect through the economy with lasting negative consequences. To top it off, even with the deal that was eventually reached, Standard & Poor’s dropped the U.S. from its list of AAA sovereign nations over concerns that political intransigence in Washington would stand in the way of meaningful solutions.

The new committee has an opportunity to...

Monday, August 8, 2011 - 4:55 PM

Members of the new Congressional Joint Committee on Deficit Reduction will have a threshold decision to make: Do they want to take their mandate seriously?

If the answer is yes, they will likely have to make decisions in the public interest that will not sit well with the party leaders who appointed them. If the answer is no, they will heighten public frustration with the political process and risk deep automatic cuts in programs many of them care about.

Which should it be?

The answer is obvious. In hard times, the national interest always tops narrow or partisan concerns. And yet, pressure on members of the committee to fiercely protect the interests of favored constituencies will be enormous. It has already begun in the form of intense lobbying of party leaders to only appoint “safe” members who are firmly opposed to compromise. 

Arrayed against this pressure is the stark reality that we can’t fund future spending commitments with today’s level of taxation. Unless someone steps up to the challenge of reconciling the competing values and needs of a diverse society, our nation will suffer the consequences -- not just within some artificial 10-year “budget window,” but for decades to come. 

Failure to confront this challenge got us into the fiscal ditch we’re in. The Joint Committee has...

Monday, August 1, 2011 - 6:02 PM

In this debt-limit game of musical chairs, the music has stopped and it’s time to grab a seat. The only one available is the deal worked out by congressional leaders and the Obama administration over the weekend. It is not a solution to our nation’s fiscal problems and is far from the “grand bargain” needed to put us on a sustainable path. However, a debt-limit deal needs to get done. This one at least avoids a self-inflicted wound caused by the government’s defaulting on its obligations, and it gives proponents of a grand bargain another turn at bat.

The main flaw in the agreement is that it reflects the continued refusal of our political leaders to confront fiscal reality. Once again, they are leading with discretionary spending cuts while leaving the biggest problems -- entitlement and tax reform -- for another day.

If this is what they have to do to pass a debt limit increase, so be it. But no one should pretend that they have solved anything other than an artificial political crisis. The fundamental fiscal crisis is pretty much unchanged.

A positive element is the proposed special congressional committee charged with finding deficit reductions beyond the initial trillion-dollar down payment. The committee is the only aspect of the agreement that...