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Showing posts with label Bruce Bartlett. Show all posts
Showing posts with label Bruce Bartlett. Show all posts
12 May 2017
14 December 2012
What If There Is No Fiscal Crisis? 13DEZ12
MOTHER JONES presents a compelling argument against the reality of the fiscal cliff and offers evidence from conservative republican economist Bruce Bartlett from the reagan and george h w bush administrations. If he is right then the repiglicans / tea-baggers in Congress are using this in an attempt to protect the bush tax cuts for the rich and corporate welfare and tax loopholes. They are continue to wage class warfare against the 98%.
If there is no fiscal crisis, can there be a fiscal cliff?
The current hullabaloo over tax cuts, spending cuts, entitlement programs, and the debt ceiling has yielded much fodder for policy-minded columnists, practically establishing a job creation program for budget-following wonks. Recently, there have been a rash of articles from this set advancing the essential point that raising the eligibility age for Medicare, a proposal that might be on the table (that is, if there is a table), would be awful policy because doing so would remove healthier seniors from the Medicare pool and place this older group into the non-Medicare pool and boost costs there. (Health care costs would presumably go up overall—and particularly for private employers who would have to carry these 65- and 66-year-olds on their policies.) Has this spate of policy op-edding influenced the negotiating positions? We don't know. The talks are all hush-hush. And this week, another policymeister, in one of the most consequential columns of the past fortnight, added another significant contention to the discourse: There is no fiscal crisis.
Bruce Bartlett, who was an economics official in the administrations of Presidents Ronald Reagan and George H.W. Bush, is a contributor to the New York Times' Economix blog, and in an important post a few days ago he delved into the Government Accountability Office's new estimates of the federal government’s long-term budget outlook. The bottom line: "The idea that we are facing a crisis is complete nonsense." Bartlett, by the way, considers himself a conservative, a reality-based conservative. He points out, per the GAO report:
Here it is in chart form, courtesy of the GAO:
Note the explosive growth in net interest. Using these numbers,
Bartlett writes that the GOP's demand that Social Security and Medicare
be cut immediately—say, by raising the age of eligibility for Medicare
and changing the inflation adjustment formula for Social Security—is not
in sync with the actual data:
Bartlett advocates letting all the George W. Bush tax cuts expire and all the automatic spending cuts kick in. He acknowledges that this might cause a short-term hit to the economy, but he argues that taming the deficits will lead to medium- and long-term growth. Whether that's the right policy solution or not—it does entail a difficult trade-off—it's at least based on data that reflects the real world.
His post, though, does make one thing clear: President Barack Obama (or anyone else) need not rush into a big deal at this moment. There is no imminent fiscal crisis regarding entitlements. The Republicans are merely hyping the matter to bolster their attempts to extract a ransom for either (a) extending the Bush tax cuts for the bottom 98 percent, or (b) acceding to a hike in the debt ceiling, which will soon reach its latest limit, or both. The sky is not falling. It is not on fire. And the cliff may not be that frightening.
http://www.motherjones.com/mojo/2012/12/no-fiscal-crisis-cliff-bruce-bartlett
The current hullabaloo over tax cuts, spending cuts, entitlement programs, and the debt ceiling has yielded much fodder for policy-minded columnists, practically establishing a job creation program for budget-following wonks. Recently, there have been a rash of articles from this set advancing the essential point that raising the eligibility age for Medicare, a proposal that might be on the table (that is, if there is a table), would be awful policy because doing so would remove healthier seniors from the Medicare pool and place this older group into the non-Medicare pool and boost costs there. (Health care costs would presumably go up overall—and particularly for private employers who would have to carry these 65- and 66-year-olds on their policies.) Has this spate of policy op-edding influenced the negotiating positions? We don't know. The talks are all hush-hush. And this week, another policymeister, in one of the most consequential columns of the past fortnight, added another significant contention to the discourse: There is no fiscal crisis.
Bruce Bartlett, who was an economics official in the administrations of Presidents Ronald Reagan and George H.W. Bush, is a contributor to the New York Times' Economix blog, and in an important post a few days ago he delved into the Government Accountability Office's new estimates of the federal government’s long-term budget outlook. The bottom line: "The idea that we are facing a crisis is complete nonsense." Bartlett, by the way, considers himself a conservative, a reality-based conservative. He points out, per the GAO report:
[S]pending is not out of control. Entitlement programs like Social Security and Medicare are rising gently as the baby-boom generation retires. All other spending, including that for the military and domestic discretionary programs, falls—with the notable exception of interest on the debt. Interest rises sharply as the deficit rises, principally because the G.A.O. assumes that revenue will not be permitted to rise above its historical average—as Republicans continually insist.In other words, the inability to raise revenue to diminish deficits—and tackle rising interest payments—is the major problem.
Here it is in chart form, courtesy of the GAO:
To be sure, some restraint is needed in federal entitlement programs…Spending for Social Security, in particular, is very stable. Relatively modest changes, such as raising the taxable earnings base slightly, would be sufficient to put the program on a sound footing virtually forever.Bartlett chides Republicans for droning on and on that domestic discretionary spending is responsible for bloated government. But, he points out, "such programs have already been cut sharply by the Budget Control Act of 2011." He adds, "That leaves interest on the debt as the principal driver of long-term spending and deficits." And if the Rs continue to resist raising revenues, he maintains, there will be higher spending for interest on the debt. (The interest line in that chart could even be much greater, if interest rates go up.)
Bartlett advocates letting all the George W. Bush tax cuts expire and all the automatic spending cuts kick in. He acknowledges that this might cause a short-term hit to the economy, but he argues that taming the deficits will lead to medium- and long-term growth. Whether that's the right policy solution or not—it does entail a difficult trade-off—it's at least based on data that reflects the real world.
His post, though, does make one thing clear: President Barack Obama (or anyone else) need not rush into a big deal at this moment. There is no imminent fiscal crisis regarding entitlements. The Republicans are merely hyping the matter to bolster their attempts to extract a ransom for either (a) extending the Bush tax cuts for the bottom 98 percent, or (b) acceding to a hike in the debt ceiling, which will soon reach its latest limit, or both. The sky is not falling. It is not on fire. And the cliff may not be that frightening.
04 May 2012
Romney's Biggest Fib (on Obamacare)? from MOJO 4MAI12
mitt romney is unable to offer the American electorate anything that could be considered a positive alternative to Pres Obama's policies do he resorts to flat out lies and deception. Consider what Bruce Bartlett, of the reagan and george h w bush administrations, has to say about romney's claims on Obamacare.
Bruce Bartlett, who served as a senior economist in the Ronald Reagan and George H.W. Bush administrations, was more blunt in his appraisal of Romney's assertion that Obamacare will lead to government control of half of the economy: "This analysis is so stupid it is hard to know where to begin." He notes:
Inevitable Republican nominee Mitt Romney
Bruce Bartlett, who served as a senior economist in the Ronald Reagan and George H.W. Bush administrations, was more blunt in his appraisal of Romney's assertion that Obamacare will lead to government control of half of the economy: "This analysis is so stupid it is hard to know where to begin." He notes:
Health spending has been rising for years for reasons unconnected to Obamacare. Why assume that all of any projected increase between now and 2020 results solely from that? Tossing in all private health spending as essentially part of government spending is fundamentally dishonest. Its only purpose appears to be to find some desperate way of lifting total spending above the 50 percent threshold. If you are going to do that, why not include every other sector of the economy subject to government control?Here is the full article from MOJO....
Under Obama, the GOP candidate says, government will "control half the economy." Economic experts rate this scare tactic somewhere between "ridiculous" and "stupid."
Inevitable Republican nominee Mitt Romney
On
April 24, the night Mitt Romney triumphed in five primary contests and
essentially clinched the Republican presidential nomination, the former
Massachusetts governor delivered his victory speech in Manchester, the
largest city in the swing state of New Hampshire. This address, CNN noted, marked Romney's "pivot to the general election campaign." WMUR, the ABC affiliate in New Hampshire, declared, "Romney Delivers Rousing Speech in Manchester." Fox Nation dubbed the address, "Romney's Killer Speech." The New York Times reported that Romney "laid out a succinct argument for his economic leadership."
There was not much media analysis of the substance of the speech—especially Romney's chief argument that he and Obama "have very different visions" of the United States. The core of Romney's case for himself was this:
I asked Romney HQ for an explanation, and it graciously replied with this:
There was not much media analysis of the substance of the speech—especially Romney's chief argument that he and Obama "have very different visions" of the United States. The core of Romney's case for himself was this:
Government is at the center of [Obama's] vision. It dispenses the benefits, borrows what it cannot take, and consumes a greater and greater share of the economy. With Obamacare fully installed, government will come to control half the economy, and we will have effectively ceased to be a free enterprise society.With government controlling 50 percent of the entire economy, Romney said, "our lives will be ruled by bureaucrats and boards, commissions, and czars." But is it true that once Obamacare fully kicks in, government will have complete dominion over half the economy? Or might this be one of the biggest fibs of Romney's campaign?
I asked Romney HQ for an explanation, and it graciously replied with this:
In 2010, government expenditures as % of GDP were 38.13%. By 2020, with Obamacare in place, the government estimates that health care spending as a % of GDP will climb 1.84 points. This would bring government expenditures as % of GDP to 39.97%. In addition, private health care expenditures will be 10.03% of GDP in 2020. If we count that as under federal control, we get to 50.00% of GDP.I ran this justification by several economists who are consulted on such matters by media fact-checkers, and—to various degrees—they took exception. There is, it seems, much wrong with Romney's statement and the analysis upon which it rests.
Eugene
Steuerle, an economist with the Urban Institute (who says he doesn't
fancy being drawn into dust-ups regarding statements from presidential
candidates), notes that the Romney camp is adopting an unfair baseline.
It's starting point is 2010, when, due to the recession, the US
government was spending more (food stamps, unemployment benefits, other
forms of assistance, and the stimulus) and the economy was lackluster.
Consequently, government expenditures as a percentage of gross
domestic product were higher than normal. Steuerle points out that it
is wrong to assume this level will remain, and he notes that when
"recessionary spending" ends, the overall government
expenditures-to-GDP ratio is likely to drop.
This sort of statistics fudging is routine spin for a political campaign. Gary Burtless, an economist at the Brookings Institution, explains that there are more fundamental problems with Romney's analysis. Romney claims that all private health care expenditures—such as those that occur when a Medicare beneficiary pays for a service not covered by the program or when a person with insurance at work obtains medical services—should be counted in the government-controlled category. This is "ludicrous," Burtless says.
To recap: Romney rigs the baseline by predicating his analysis on that 38 percent government-expenditures/GDP figure. Then he adds 10 percent for private health care expenditures in a manner that Burtless calls "ridiculous."
There's more. Burtless contends that it is problematic to term making a transfer payment—for example, sending someone a Social Security check—an act of government control. "The government only has control in the sense that it is raising the money—or borrowing it—and sending it out to the recipients," he explains. "But it doesn't control how these people spend the money." His mother, he notes, receives Social Security, "and she can spend it any way she wants. She can give it to the Romney campaign." With Medicare, she can select her own doctor; the government doesn't control her choice.
"The government does control the Defense Department," Burtless notes. "It pays soldiers and general, pays for the supplies, tells the soldiers where they will be stationed. But when it gives me a transfer payment, does it really control the economy?" Given that there are federal laws regarding property, patents, interstate commerce, trading aboard (such as the prohibition on trading in Cuba), and other economic activity, he adds, "you could say government controls 100 percent of the economy."
Bruce Bartlett, who served as a senior economist in the Ronald Reagan and George H.W. Bush administrations, was more blunt in his appraisal of Romney's assertion that Obamacare will lead to government control of half of the economy: "This analysis is so stupid it is hard to know where to begin." He notes:
Yet no one is howling foul about Romney relying on this scary-sounding factoid to promote his claim that Obama is on the verge of destroying free enterprise in the United States. (PolitiFact has previously called out Romney for saying the United States is "inches away from no longer being a free economy.")
On the campaign trail, Romney touts his corporate credentials and argues he knows what's best for the ailing US economy. That's certainly fair play. But he has continuously accused Obama of not understanding the nation or its economy (while apologizing for the country overseas) and of desiring to turn the United States into an European-style state where poverty will spread. To level such an indictment credibly, it helps to toss out facts—or what seem to be facts. By charging Obama with a power grab that will place government in control of half of the economy, Romney positions himself as a savior for those voters who believe (maybe because of Romney's own demagoguery) that Obama is running amok and threatening the fundamental nature of the nation.
This claim was a supersize stretch of the truth. Yet nothing prevented Romney from making good use of it, for in this political culture there is often little, if any, penalty to be paid for hurling such reality-defying rhetoric. One can only wonder how big the whoppers will get by November.
This sort of statistics fudging is routine spin for a political campaign. Gary Burtless, an economist at the Brookings Institution, explains that there are more fundamental problems with Romney's analysis. Romney claims that all private health care expenditures—such as those that occur when a Medicare beneficiary pays for a service not covered by the program or when a person with insurance at work obtains medical services—should be counted in the government-controlled category. This is "ludicrous," Burtless says.
"This analysis is so stupid it is hard to
know where to begin," Bruce Bartlett said of Romney's assertion that
Obamacare will lead to government control of half the economy.
Romney is assuming that under Obamacare, these health care
transactions will be controlled by government, apparently accepting the
premise that Obama's initiative is a total government takeover of the
health care sector (a much-repeated conservative trope that PolitiFact.com declared
the "lie of the year" in 2010). But, Burtless points out, private
health care expenditures have long been subject to government
regulations, and Obama's health care law does not "materially change
the control of the health care sector that is considered private." He
adds, "You can't move private dollars to 'government control' just
because of health care reform. You can't just reclassify these private
dollars under government control. The private dollars my mother spends
outside Medicare are no more under government control now than when
this was done in the Reagan years."To recap: Romney rigs the baseline by predicating his analysis on that 38 percent government-expenditures/GDP figure. Then he adds 10 percent for private health care expenditures in a manner that Burtless calls "ridiculous."
There's more. Burtless contends that it is problematic to term making a transfer payment—for example, sending someone a Social Security check—an act of government control. "The government only has control in the sense that it is raising the money—or borrowing it—and sending it out to the recipients," he explains. "But it doesn't control how these people spend the money." His mother, he notes, receives Social Security, "and she can spend it any way she wants. She can give it to the Romney campaign." With Medicare, she can select her own doctor; the government doesn't control her choice.
"The government does control the Defense Department," Burtless notes. "It pays soldiers and general, pays for the supplies, tells the soldiers where they will be stationed. But when it gives me a transfer payment, does it really control the economy?" Given that there are federal laws regarding property, patents, interstate commerce, trading aboard (such as the prohibition on trading in Cuba), and other economic activity, he adds, "you could say government controls 100 percent of the economy."
Bruce Bartlett, who served as a senior economist in the Ronald Reagan and George H.W. Bush administrations, was more blunt in his appraisal of Romney's assertion that Obamacare will lead to government control of half of the economy: "This analysis is so stupid it is hard to know where to begin." He notes:
Health spending has been rising for years for reasons unconnected to Obamacare. Why assume that all of any projected increase between now and 2020 results solely from that? Tossing in all private health spending as essentially part of government spending is fundamentally dishonest. Its only purpose appears to be to find some desperate way of lifting total spending above the 50 percent threshold. If you are going to do that, why not include every other sector of the economy subject to government control?If Romney equates government involvement in an economic sector with control, Bartlett notes, then there's no limit to the nightmare Romney is promoting. "Agriculture is heavily controlled, so why don't we add all food consumption to government's share of GDP?" Bartlett asks. "Banking is also heavily controlled, so let's add that too. Ditto housing, manufacturing, etc. This doesn't pass the laugh test."
Yet no one is howling foul about Romney relying on this scary-sounding factoid to promote his claim that Obama is on the verge of destroying free enterprise in the United States. (PolitiFact has previously called out Romney for saying the United States is "inches away from no longer being a free economy.")
On the campaign trail, Romney touts his corporate credentials and argues he knows what's best for the ailing US economy. That's certainly fair play. But he has continuously accused Obama of not understanding the nation or its economy (while apologizing for the country overseas) and of desiring to turn the United States into an European-style state where poverty will spread. To level such an indictment credibly, it helps to toss out facts—or what seem to be facts. By charging Obama with a power grab that will place government in control of half of the economy, Romney positions himself as a savior for those voters who believe (maybe because of Romney's own demagoguery) that Obama is running amok and threatening the fundamental nature of the nation.
This claim was a supersize stretch of the truth. Yet nothing prevented Romney from making good use of it, for in this political culture there is often little, if any, penalty to be paid for hurling such reality-defying rhetoric. One can only wonder how big the whoppers will get by November.
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