To Save a Generation
Today's job report brings good-ish news, but it will still be months before we hit full employment. For young people that could mean a lost half-decade of life.
Bruce Bartlett's excellent column today offers another glimpse of the economic path not taken by the GOP: instead of pressing for (relatively small but economically painful) reductions in appropriations in the current year, the new majority should have pressed for enactment now of entitlement reforms to take effect as the economy recovers.
Instead of fooling around with legislation that should have been finished months ago, Congress ought to be developing a budget resolution for fiscal year 2012, working from President Obama’s budget proposal strong>released in February<. The Budget Act of 1974 says the House and Senate should have a budget resolution to consider no later than April 1, with final action no later than April 15.
There is just no possible way these deadlines are going to be met. The House Budget Committee, in particular, is deeply involved in the 2011 budget negotiations because its chairman, Rep. Paul Ryan of Wisconsin, was given extraordinary powers to set spending levels for appropriations that should have been established by the strong>budget resolution<.
Given the impasse between House Republicans, Senate Democrats and the White House, it’s hard to see the fight over the 2011 budget being resolved any time soon. Newly elected Republicans in the House, many of them elected with Tea Party support, are still committed to strong>slashing spending< this year even though almost half of 2011 outlays have already been spent. Every day that goes by reduces the amount of money available in this year’s budget to cut. …
Today's job report brings good-ish news. Jobs are being created at a rate of over 200,000 a month, but with shrinkage in the public sector offsetting some of the improvement in the private sector. Even at that accelerated rate, it will be months and months before we return to full employment. For the young people FrumForum has been writing about this past week, we are looking at least at a lost half-decade of life, maybe longer.
With a new Republican majority in the House, you'd think this would be a moment to advance a positive Republican economic alternative. But no. Today's GOP is a party with a budget policy, not an economic policy. As Bruce Bartlett notes, it is not even a well-considered budget policy.
In an alternative universe, the opposition Republicans could have coalesced two years ago upon an active anti-recession program consistent with free market principles and grounded in modern economics:
- A payroll tax holiday put into place early
- A two-year extension way back in 2009 of the Bush tax cuts to increase confidence that tax increases would not hit in 2011
- A small and temporary program of federal spending on infrastructure and aid to state governments
- Calls for active monetary policy, including a second round of quantitative easing back in April 2010 rather than waiting till late fall
- Extension of jobless benefits for longer periods of time
- A program of deficit reduction over time, going into effect only after the job market began to recover
- Enforcing immigration laws more tightly and lowering legal immigration flows
Instead, constrained by politics and by economic popularizers who rejected not only John Maynard Keynes, but also Milton Friedman, Republicans have for two years coalesced around a program that might be described as: "No soup for you."
- No action on job creation at all beyond the renewal of the Bush tax cuts that were in place when the economy collapsed and that obviously did nothing to prevent the collapse
- Calls for tighter monetary policy
- Rhetorical commitment to budget-balancing
- Symbolic and immediate budget cuts combined with grand but unrealistic pledges of radical entitlement reform starting ... just over the horizon and affecting only the generations that do not vote Republican.
Ronald Reagan cut taxes to get the US economy moving again, but today's GOP wouldn't even advocate that. Instead, it has offered Americans a set of policies simultaneously aggressive and also weak, uncompassionate and also ineffective, austere and also useless.
How can it be that the country's great party of opposition fails to produce productive policy alternatives for years and years?
How did we allow the rage of political opposition to freeze our concern for fellow citizens in distress?
Those are questions that deserve much thought - and that someday may be pressed upon the party by the generation that has suffered most since 2007.
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