Dan Carol

To Justify New Spending — We Gotta Do The Math

So here's another installment of my "epic" (jk) guest blogging mini-series, summarizing the three big challenges facing progressives in the post-Katrina world.

The second major challenge post-Katrina is dealing with red ink and our growing national debt. Between the Bush tax cuts, the Iraq war, rising energy prices and Katrina cleanup we are looking at federal and state budget strain for as far as the eye can see. Now some of this was a planned event by the Bush Administration designed to make new domestic spending harder to do, following the David Stockman/Ronald Reagan model of the early 1980s (read the William Greider book for more on this sad tale); some of this debt of course will derive from the unplanned natural catastrophe to which we must respond. But to responsible progressives who must govern after Bush, it's a nightmare to be reckoned with.

It's not enough to point out, as I like to with my political strategist cap on, that Bill Clinton and the Democrats didn't get a lick of credit for being responsible and balancing the budget in 1993 and so we should be wary of running on the Gene Sperling/Robert Rubin "let's be responsible" platform in 2008.

But we can't just ignore the debt issue either. We need a strategy for addressing the deficit intelligently while also finding ways to move money for smart new investments we have to make.

So here's my take on how to start that drumbeat -- require economic impact assessments on government spending.

Sound crazy? At a time of record budget deficits that will crowd out future investments in needed programs/infrastructure, how will new spending be justified?

I say DO THE MATH and require that we assess the total return/payback on all programs and tax expenditures.

What would happen?

1-We would find that progressive programs like preventative health, investing in kids/jobs/education, workforce, and clean energy would more than pay for themselves.

2-We would find that insider tax giveaways or Alaskan bridges to nowhere would look like the economic losers they are.

3-We would force conservatives to be against doing the math on what government buys, taking away arguments that government spending is useless.

If we can’t sell the value of levees and long-term projects after New Orleans, when will be able to make that case?

Just like the old environmental impact assessments changed state, local and federal decision-making by requiring new analysis and evaluation, a new EIA would force the debate to be about the net economic and social impacts of all government investments and tax breaks. We'll win this debate -- if we do the math.

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Posted at 10:44 AM, Oct 19, 2005 in Economy | Fiscal Responsibility
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