Claiming Victory

Phoenix Woman at Daily Kos wants everyone to calm down about Robert Rubin's invitation to speak to the House Democratic caucus on the subject of fiscal responsibility. Max Sawicky objects, making some goods points en passant about the netroots' weakness for what David Sirota has labeled "partisan war syndrome". That said, this from Sawicky -- "Let's hope from that quarter that we don't start hearing calls to shift troops from Iraq to Iran, or how we need to fix Social Security by cutting benefits (Rubin's special interest)" -- makes me wonder.

I'm not sure where one gets the idea that Rubin has a particular passion for cutting Social Security benefits. Read, for example, his November 9 speech to the Economic Club of Washington and you'll find no advocacy of Social Security cuts. Rather, the headline out of his speech was "Former US Treasury chief Rubin says tax rises needed" based on progressive-friendly claims like "I think if you were to increase taxes right now, you would have probably about zero negative effect on the economy."

This is not to deny that there's a real deficit-related disagreement between Rubin and Sawicky here. Max thinks there's no problem with running a budget deficit of around 2-3 percent of GDP, whereas Rubin believes that in light of projected entitlement-related spending increases in the future we should be trying to run a budget surplus in the present day. I don't, however, see a disagreement about Social Security benefits. Which is to agree with Ezra that I think there's a tendency on both sides of the intra-Democratic economic policy debate to overstate the degree of operational disagreement. I think there is a lot of disagreement about economic policy in the Kingdom of Ends and disagreement of that sort matters, but should also be kept in perspective. The policy status quo is well to the right and both sides ought to be able to row together for a while now. In particular, Social Security advocates should note that they've more or less won the argument at this point already.

Comments

Max thinks there's no problem with running a budget deficit of around 2-3 percent of GDP, whereas Rubin believes that in light of projected entitlement-related spending increases in the future we should be trying to run a budget surplus in the present day. I don't, however, see a disagreement about Social Security benefits.

Well, there sort-of is. Rubin believes that in light of projected entitlement-related spending increases in the future we should make a mantra out of balancing the budget. This enables another round of Greenspan-style entitlement "funding," which then gets subjected to more large-scale plundering by a future Republican government. Suggesting that the budget must be balanced cedes a portion of the field, because Republicans will always be able to wreck the budget with tax deferrals and massive spending, then clamor for the need for fiscal austerity. See post-2000 for details. So the pursuit of balanced budgets is at least somewhat independent of whether the federal government will honor its commitments to Social Security.

Posted by mds | December 4, 2006 4:06 PM

The heck with your "entitlement." It is Social Security and Medicare, not some "entitlement." My grandparents paid for Medicare and Social Security through decades of work, and my paretns are now doing so, and I am beginning. The word "entitlement" is Republican rubbish.

Posted by Jennifer | December 4, 2006 4:39 PM

The fact that republicans will try to destroy a good long-term plan isn't a good reason to not pursue that plan. Though it does almost make one jealous of authoritarian one-party-rule states and their ability to set and stick to long-term plans. Democracy is hard work.

Posted by miguel | December 4, 2006 4:53 PM

I'm with Phoenix Woman on this one. The whole kerfuffle is a Daily Kos special where a purely symbolic issue - OMG, Robert Rubin gets to make a presentation to the freshmen on fiscal responsibility, and Labor doesn't get to make a simultaneous presentation about entirely different economic issues! - gets inflated into some kind of Sirota-type object lesson as to how they're all corporate stooges, each and every one! The comment section is predictably full of people declaring war on the Democratic Party and urging freshmen to walk out on Rubin, etc. I happen to align with Max on economic issues in general but that doesn't mean the whole issue isn't insufferably lame.

It's understandable why partisan Republicans would want to undermine Pelosi before her term even begins by, say, making a huge story out of the Hoyer-Murtha race, or spreading rumors about impeached judges being put in charge of intelligence. It's less clear why progressives would want to undermine the leader of the first Democratic majority in years by reading tea leaves and concluding that the woman who nearly spearheaded the defeat of CAFTA while in the minority has suddenly become a bought-and-paid-for stooge for free trade.

An awful lot of good people blog over at the Daily Kos but we're in a new era now, and all that energy has to be channeled a lot more productively.

Posted by Steve | December 4, 2006 4:55 PM

There are some differences. The Hamiltonians say, "balance the budget", the (Aaron) Burrians say, "it's not that big a deal."

The Burrians say, "Directly regulate the economy so that companies aren't allowed to offshore or outsouce. Enact stricter Labor regulations that narrow the conditions underwhich a company is allowed to lay off or fire someone."

The Hamiltonians Say "Maximize the efficiency of the market. Tweak the economy & enact tougher guidelines, but otherwise let the market do it's thing. Then redistribute the goodies through more Progressive Taxation & stronger welfare programs."

The Hamiltonians say "The minimum wage is sexy, the EITC is sexier."

The Burrians say "The EITC is sexy, the minimum wage is sexier."

The Burrians declare "No more liberalized trade."

The Hamiltonians declare "Keep trade open, but strengthen the safety net at home to aid workers. Overhall unemployment insurance, implement "wage loss insurance", enact "Temporary Earnings loss accounts"

The Hamiltonians say "We have a lot of other technocratic proposals to increase savings & improve education thru government action as well as a few Good Government measures."

The Burrians say "We support a number of the nifty social programs the Hamiltonians are proposing & we promise to push & lobby for them harder than the Hamiltonians will."

The Hamiltonians say "We are diverse conglomeration of people from a variety of areas; including prominent academics, economists, political scientists, policy analysts, think tankers from CAP, New America, NBER & Brookings & former Clinton people."

The Burrians say "Our primary base is the staffs at the Economic Policy Institute & The Center for Economic & Policy Research think tanks; both in conjunction with the AFL-CIO."

The Burrians primarily listen to Indie Rock. They are distrustful of most forms of pop & dance music which they think panders & relies too much on superficiality & posing. To them it's all about the music & the music should mean something.

The Hamiltonians are Popists, they believe there's just as much merit in a nice dance track or a Britney Spears song as something more "artistic." They don't believe in guilty pleasures, believing that anything that sounds good, is good. They think Indie Rock bands are boring, but they guess Interpol is kind of cool.

Posted by DRR | December 4, 2006 5:01 PM

The confusion of a few of the people on those threads is amusing. We must stand with the true working-class progressives against the fat-cats who live on the coasts! No, wait! We must stand with the true progressives on the coasts against the backward culture-cons who live in the interior! No, wait!

Posted by JP | December 4, 2006 5:03 PM

"The fact that republicans will try to destroy a good long-term plan isn't a good reason to not pursue that plan. Though it does almost make one jealous of authoritarian one-party-rule states and their ability to set and stick to long-term plans. Democracy is hard work."

Posted by: miguel

No. The fact that the GOP has twice now succeeded at trashing the budget with tax cuts focused as heavily as possible on the rich *is*, however, a good reason to assume that they'll trash the plan next time.

At this point GOP budget-breaking is not an oddity; it's a regular part of their program. Reagan pissed away the Greenspan Plan SS tax increase; Bush II came in and happily repeated the whole thing.

Any sane Democratic plan should assume that the next GOP president will try to cut taxes on the rich again, with massive deficits a feature, not a bug.

Posted by Barry | December 4, 2006 5:04 PM

Quoting Jennifer: "he heck with your "entitlement." It is Social Security and Medicare, not some "entitlement." My grandparents paid for Medicare and Social Security through decades of work, and my paretns are now doing so, and I am beginning. The word "entitlement" is Republican rubbish."

I know why she is chafing at the term "entitlement" because folks have turned it into a bad word, but in economic parlance, an entitlement is anything that the "someone" (the government) is obligated to provide. So the use of that term is quite legitimate and needs to be taken back from people that uses it incorrectly.

Posted by ga73 | December 4, 2006 5:04 PM

Quoth my friend the brilliant (no snark intended), leading Hamiltonian Peter Orszag:

"Some unrealistically assume trillions of dollars will be transferred from the rest of the budget to Social Security, despite substantial deficits projected in that part of the budget."

Um hmmm. And others unrealistically assume trillions of dollars in benefits will be cut.

There is no question the Hamilton group will be associated with efforts to 'curb entitlement spending growth.' They already are.

Reasonable people can argue over whether their plan is the least bad, or necessary at all, but the plan is out there, has been since 2004.

Posted by Miracle Max | December 4, 2006 5:53 PM

Barry, so does that mean we can't plan long-term? Will there never again be a FDR-style visionary? Are we constrained to short-term thinking? Can the country survive as a super-power that way? Do we assume that the American people are too stupid to learn? Do we give up?

The problem with democracy is that you have to convince people that your idea is the right one, you have to fight mis-information and demagoguery. But that is the system we have and that's the system we have to work in. You don't stop trying just because it is difficult.

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