October 30, 2014

The (Tab)ulation

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Tuesday, June 30, 2009 - 12:15 PM

It has almost become axiomatic that growing health care costs, rather than population aging, is the overwhelming cause of a projected spike in federal spending. That notion was dispelled in CBO’s Long-Term Budget Outlook published last week. As explained in the report:

“Federal spending on Medicare, Medicaid, and Social Security will grow relative to the economy both because health care spending per beneficiary is projected to increase and because the population is aging. Spending on Medicare and Medicaid will be driven by both factors, while Social Security spending will rise because of the population’s aging. Between now and 2035, aging is projected to make the larger contribution to the growth of spending for those three programs as a share of GDP. After 2035, continued increases in health care spending per beneficiary are projected to dominate the growth in spending for the three programs.”

 

Later in the report, CBO quantifies the relative effects of aging and health care growth on projected...

Thursday, June 25, 2009 - 9:30 AM

After reading this post, hopefully all of our loyal readers will finally understand the simplicity and beauty of the Pay-As-You-Go (PAYGO) concept. 

First, I should mention that today we published an issue brief on the new statutory PAYGO law proposed by President Obama and introduced in the House of Representatives to coincide with today's PAYGO hearing in the House Budget Committee, featuring OMB Director Orszag. This proposal puts in place a law that requires any new spending or tax cut legislation to be offset so that it does not increase the deficit. If it did, the law forces automatic spending cuts designed to balance out the difference.

The Concord Coalition supports enactment of statutory PAYGO. The basic message in our brief is that PAYGO can be, and has been in the past, an important budget enforcement tool that helps promote fiscal responsibility. However, PAYGO shouldn't be thought of as more than that, and certainly not as a silver bullet that can somehow solve the nation's long-term fiscal...

Monday, June 22, 2009 - 10:05 AM

On June 15 and June 16, leaders from various youth organizations traveled to Washington, D.C. for a youth conference hosted by The Concord Coalition and the Youth Entitlements Summit (YES), and underwritten by The Peter G. Peterson Foundation. The event aimed to encourage public discourse among the "Millennial generation" about the nation's fiscal challenges and to generate a collective plan of action for grassroots efforts to do the same. 

Last month, at an event for young activists, I found myself on the spot once I mentioned The Concord Coalition’s work on fiscal awareness. A fellow attendant replied, “Look, I’m not trying to be rude, but I just don’t think the debt matters.” Such indifference concerned me until I watched America’s future leaders passionately discussing the need to fix this imbalance to save our economic futures.

On the first day of the conference, we heard from politicians and scholars who are heavily involved in the fiscal policy arena, including the...

Tuesday, June 9, 2009 - 7:31 PM

Today, President Obama held a press conference with Congressional leaders to announce his support for enactment of a statutory pay-as-you-go (PAYGO) budgeting rule.

The Obama administration’s proposal looks to build off the PAYGO rules put in place during the 1990s. Similar to them in design, the Office of Management and Budget (OMB) would keep a running scorecard for the costs associated with enacted legislation for each year through 2014 and compare those costs to the established baseline. If the scorecard found the cumulative effect of enacted legislation to increase the deficit, OMB would be required to reduce spending in certain non-exempt mandatory programs to balance the difference -- a process called sequestration. Although sequestration under PAYGO was never actually ordered in the 1990's, the existence of this automatic trigger provides some incentive for members of Congress to be fiscally disciplined.

While PAYGO has recently been in place for a few years, it has only existed as a congressional rule which has often been waived or ignored for legislation requiring politically difficult trade-offs. The proposal that President Obama put forward, and that the...

Friday, June 5, 2009 - 1:30 PM

I looked at the Treasury Department’s “green book” on the Administration’s revenue proposals only a few days ago, curious to see how the Bush (soon-to-be Obama) tax cuts would be described, considering that they comprise the single most costly policy in President Obama’s proposed budget (about $2 trillion over ten years according to CBO). Seems like a pretty significant “revenue proposal” to describe, right? The Treasury green book is 131 pages long, with each tax proposal described fairly thoroughly, over the course of 1 to a few pages each, in terms of current-law treatment, reason for change, and the specifics on the President’s proposal. Yet the extension of the 2001 and 2003 tax cuts is described in exactly two places–first, as a footnote in the table of contents (note, through the emphasis added, how...

Thursday, June 4, 2009 - 12:30 PM

Both Federal Reserve Chairman Ben Bernanke and Treasury Secretary Tim Geithner have been vocal this week regarding the need to rein in our growing federal budget deficits as the economy begins to recover and work to confront the structural fiscal imbalances projected over the coming decades.

Yesterday, Chairman Bernanke testified before the House Budget Committee and spent a portion of his testimony focusing on fiscal policy. He emphasized that it is necessary for policymakers to confront these challenges now more than ever. A failure to act, Bernanke noted, will result in economic consequences which will impede growth:

Addressing the country’s fiscal problems will require a willingness to make difficult choices. In the end, the fundamental decision that the Congress, the Administration, and the American people must confront is how large a share of the nation’s economic resources to devote to federal government programs, including entitlement programs. Crucially, whatever size of government is chosen, tax rates must ultimately be set at a level sufficient to achieve an appropriate balance of spending and revenues in the long run. In particular, over the longer term, achieving fiscal...

Tuesday, May 26, 2009 - 3:29 PM

In Nobel-prize winning economist and New York Times columnist Paul Krugman's column Monday, he makes an interesting point about California's budget woes that supports much of what The Concord Coalition's message has been for the last three years traveling the country on the Fiscal Wake-Up Tour. The irony is that he often protests much of what we stand for.

In writing about the political barriers to sound fiscal policy and governance in California, he expresses concern that it "foreshadows the future of the nation as a whole." He continues:

"Last week Bill Gross of Pimco, the giant bond fund, warned that the U.S. government may lose its AAA debt rating in a few years, thanks to the trillions it’s spending to rescue the economy and the banks. Is that a real possibility?

Well, in a rational world Mr. Gross’s warning would make no sense. America’s projected deficits may sound large, yet it would take only a modest tax increase to cover the expected rise in interest payments — and right now American taxes are well below those in most other wealthy countries. The fiscal consequences of the...

Thursday, May 21, 2009 - 2:28 PM

Steven Pearlstein has a column in Wednesday, May 20's Washington Post called “Budget Scolds Shouldn’t Drown Out the Chorus Calling for Health Reform.” We assume that The Concord Coalition is among his targets given his definition:

"In the political menagerie that is Washington, there exists a species known as the budget scold — analysts, advocates, editorial writers and politicians who possess a fierce determination to bring the federal budget into better balance.

Budget scolds have a wonkish demeanor and a skeptical outlook. They possess an undue fascination with rules and processes, and speak in the arcane language of baselines, sunsets and pay-fors."

Although we don't define ourselves by the fact that we occasionally "scold," the rest of his characterization isn't that far off -- just ask those who run into us at parties. But the point of his article is that Pearlstein is concerned that worries about the budget deficit are going to scuttle health care reform. He writes:

"There have been times when the budget scolds have saved the country from short-...

Wednesday, May 20, 2009 - 12:30 PM

The Concord Coalition is currently engaging in a Fiscal Stewardship Project that takes us to select cities across the country. This project is designed as a follow-up to our Fiscal Wake-Up Tour visits in those cities and as part of that we have created local Fiscal Advisory Councils (F.A.C.'s) -- groups of local citizens interested in doing more to promote and discuss fiscal responsibility. These councils meet regularly and are focused not only on talking about our fiscal future, but also in discussing possible solutions to our long-term budget challenge.

One of the event types we conduct in conjunction with these F.A.C. meetings is called a "Choice Dialogue." These are day-long public forums where randomly selected individuals, from the cities where the F.A.C.'s are located, come together to work through the information about our fiscal challenge and coalesce around common values and solutions. The goal is for the conclusions they reach to then be presented to the F.A.C. members, who then undergo a lengthy dialogue of their own, so that the ideas and solutions the F.A.C. coalesces around can truly be said to be informed by community thoughts...

Tuesday, May 19, 2009 - 4:26 PM

Over the last week and a half, I've watched the launch and rapid growth of a very promising movement. It is called "80 Million Strong for Young American Jobs" and represents the coalescence of over a dozen leading youth organizations to advocate for a new American economy.

This is the kind of movement, the kind of coordinated effort that America needs to tackle our greatest and most glaring problems. 80 Million Strong promises not just the organization and conviction to accomplish their goals, but the understanding and foresight to accomplish the right goals without compromising our future. It is the goal of The Concord Coalition to educate the public about the importance of fiscal sustainability. It is the goal of 80 Million Strong to be the voice of the Millennials so they can hold government accountable to the next generation. At the intersection of the two, I hope to see the political strength of young Americans used judiciously to advocate for sound government and a secure fiscal future.

As Concord's Youth Outreach Coordinator, I am proud to be a part of the 80 Million Strong coalition, and look forward to witnessing their continued growth over the coming months.

Be sure to...