An interesting poll this month in the Des Moines Register shows that Democrats and Republicans have very different opinions on the relative importance of the federal deficit versus unemployment and jobs as campaign issues. It might be, however, that the two sides just have different ways of expressing concern over the same issue: our nation’s economic future.
An interesting poll this month in the Des Moines Register shows that Democrats and Republicans have very different opinions on the relative importance of the federal deficit versus unemployment and jobs as campaign issues. It might be, however, that the two sides just have different ways of expressing concern over the same issue: our nation’s economic future.
Almost one-quarter of Republicans in the poll of likely Iowa caucus-goers ranked the deficit as the top issue (23 percent). Only 11 percent of Republicans ranked unemployment/jobs as the top issue.
On the Democratic side, the numbers were nearly the reverse with 21 percent of likely caucus-goers ranking jobs as their top priority and 9 percent ranking the deficit first.
Taken together, roughly one-third of likely caucus-goers in both parties ranked these two issues at the top.
The Register poll, though limited to Iowans, suggests that there could be a path to consensus if Democrats and Republicans reject the premise that concern about the deficit implies indifference to unemployment and jobs, and vice versa.
It is possible, and indeed it is perfectly sound for policy and political reasons, to be concerned about both.
The main reason to be concerned about the deficit is not its immediate effect in any one year, but its projected path. While deficits can be an appropriate near-term response to an economic slump, allowing the debt to grow faster than the economy over a long period of time ultimately slows growth and income from what it would be otherwise.
As the nonpartisan Congressional Budget Office (CBO) recently noted, “the high and rising amount of federal debt” projected under current law “would have significant negative consequences for both the economy and the federal budget.”
According to CBO, “Higher debt would reduce the amount of U.S. savings devoted to productive capital (resources that produce economic benefits over time) and thus would result in lower incomes than would otherwise occur, making future generations worse off.”
A CBO simulation found that inflation-adjusted national income per person would be about 50 percent higher over the next 25 years if we can keep the debt from growing any faster than the economy.
So concerns about the rising debt and jobs are in fact intertwined.
Republicans may be more inclined to express this concern by arguing for a smaller deficit and Democrats may be more inclined to express it as a jobs issue.
The important point is that a significant portion of the electorate is rightly concerned about the nation’s economic future. Unfortunately, our highly polarized political environment tends to break everything down into either/or propositions, making solutions almost impossible.
Voters should not be told that they need to sacrifice one of these goals by supporting the other.
It may be too late in the 2014 campaign season to expect a change. But as the 2016 campaign ramps up, with the presidency at stake, candidates have an opportunity to reject the false choice between deficit reduction and jobs. They should present plans to deal with both problems as one.
A sensible fiscal policy and a responsible campaign platform would recognize that deficit reduction can be phased in to accommodate any lingering sluggishness in the economy while directing the bulk of the savings to future years, when the deficit is projected to resume its upward climb.
It’s not just a matter of political compromise; it’s also the best policy.
