Kuttner: Disarm Deficit Hawks w/Universal Healthcare

In today's Washington Post, public policy wonk Robert Kuttner, who's also co-editor of American Prospect Magazine and the author of  "Obama's Challenge: America's Economic Crisis and the Power of a Transformative Presidency," tells us about "The Deficit Hawks' Attack on Our Entitlements."

This snippet pretty much sums up his thoughts today:

...The economy we bequeath to our children has everything to do with getting growth back on track and almost nothing to do with imagined future deficits.

Kuttner continues:

History provides a parallel. At the end of World War II, the public debt was about 120 percent of GDP -- about three times today's ratio. Yet the heavily indebted wartime economy stimulated a quarter-century postwar boom -- because all that debt went to recapitalize American industry, advance science and technology, retrain our unemployed and put them to work.

We need to increase public spending and debt now to restore economic growth and then gradually reduce the debt ratio once recovery comes. Social Security has little to do with this challenge. Nor does Medicare, if we reform our overall health system.

Kuttner gives us an account of machinations today in the White House with regard to President Obama's "Fiscal Responsibility Summit." Apparently, as Kuttner narrates it, the event was trimmed down to a half-day affair from its original full-day agenda due to skepticism expressed by Democratic congressional leaders.

Clearly, that skepticism was aimed squarely at conservative GOP'ers, and Kuttner also singles out another target of these skeptics: Blue Dog "Deficit Hawks" (i.e.: those leading the "sky-is-falling" meme within our own party with regard to "mortgaging our children's future"); he specifically mentioned House Budget Committee Chairman John Spratt of South Carolina and his alter ego in the Senate, Kent Conrad of North Dakota.

Kuttner commenting about their ilk's decade's long, idiotic rants regarding entitlement program spending being the reason for  impending U.S. financial gloom and doom...

...when the crash came, the cause was not deficits but wild speculation on Wall Street.


Why perversely cut these programs to pay for the sins of Wall Street? The attack on social insurance is really an ideological assault, dressed up as fiscal high-mindedness...

In closing, Kuttner tacitly asks the question: "Exactly who are the idiots here?"

...[Social Security and Medicare] face very different challenges and remedies. Social Security's accounts are actually near long-term balance. The Congressional Budget Office puts the 75-year shortfall at only about one-third of 1 percent of projected gross domestic product...

...Medicare really does face big deficits. But that's because Medicare is part of a hugely inefficient, fragmented health insurance system...

...The decent cure for Medicare's cost inflation lies in comprehensive universal health insurance so that the entire system is more efficient and less prone to inflation. You don't hear many budget hawks supporting that brand of reform.

Bob Kuttner rocks!

Tags: Blue Dogs, Democrats, depression, Economy, entitlement spending, entitlements, health insurance, Medicare, President Barack Obama, Recession, Robert Kuttner, Social Security, U.S. budget deficits, universal healthcare, White House Fiscal Responsibility Summit (all tags)



Tips: It's just 2 or 3 Senate votes btwn...

...making a progressive agenda a reality...or not...

by bobswern 2009-02-23 09:46PM | 0 recs
Okay...okay...4 or 5 Senate votes...

...since Nelson and Conrad, etc., are (technically) Democrats...

...which reminds me...are brain transplants covered under U.S. Senate healthcare?

by bobswern 2009-02-23 09:49PM | 0 recs
Re: Kuttner: Disarm Deficit Hawks w/Universal

Good diary, Bob. It's a matter of spending wisely.

Well stated!

by SuperCameron 2009-02-24 09:43AM | 0 recs

will have universal health care by 2011, and they're going for free education.  If their population has basic needs, then the Chinese can start spending, and thus providing jobs and creating wealth for the workers.  

We need universal health care if we're to get back on track.  We have free education, but it needs to be much better, the Chinese kids still have an idea of progress that propels them to study hard and get ahead, like we were in the fifties.

What is progressive is what makes for continued progress, and for the creation of wealth.  Amazing that some, for  so-called moral reasons, would rather sink then level the playing field.  

by anna shane 2009-02-24 09:55AM | 0 recs
Jim Cramer Vid

Hey Bob-

Have you seen this video?

http://link.brightcove.com/services/link /bcpid1815813252/bctid14007045001

Jim Cramer gives us the most pessimistic outlook for nationalization I've heard yet.  He basically says it will be the "end of capitalism".  He focuses on the annuities markets and the fact that the govt would crowd out insurance industries for preferred stock.  He floats the possibility that people's life insurance portfolios would fold.

I'm not sure I agree with what he is saying.  After all, if an insurance company is holding preferred stock in CitiGroup right now, they would have an equally difficult time paying life insurance.  Plus, if they divest, can't they just put their money into something more solid such as T-bills?  

But it certainly is thought-provoking.  Might be good fodder for a diary.

by the mollusk 2009-02-24 10:33AM | 0 recs
Not a big Cramer fan here, at all.

As long as you ignore the reality that the banks and investment houses, through sheer greed, did a really great job of bringing capitalism to its knees, all by themselves (because the gov't sure as hell wasn't watching), then Cramer makes sense.

Annuities markets crowded out? These insurance co's were the ones enabling the writing and purchasing of all of this sovereign and corporate debt--"vapor paper"--for which we're paying the price right now.

And, take a look around, anyone who's invested in tax-deferred annuities, 401(k)'s and other vehicles as such, are already getting wiped out quite nicely right now.

Cramer's hoping his theatrics will make us blind to the truth and his basic bias...since he comes from the world of Gordon Gecko, Reagan and the supply siders...and their ship has sunk.

But, he's still funny...

by bobswern 2009-02-24 12:24PM | 0 recs
Kuttner is a demi-god

He is the main reason to read the WaPo.

by Charles Lemos 2009-02-24 03:34PM | 0 recs


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