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Another Deficit Hawk Throws In the Towel?

February 15th, 2010 . by economistmom

Senator Evan Bayh announced today that he will not seek reelection; here’s the CNN story (from which the above video comes). Why not? His main explanation (as highlighted by the Washington Post’s Jonathan Capehart):

Two weeks ago, the Senate voted down a bipartisan commission to deal with one of the greatest threats facing our nation: our exploding deficits and debt. The measure would have passed, but seven members who had endorsed the idea instead voted ‘no’ for short-term political reasons. Just last week, a major piece of legislation to create jobs — the public’s top priority — fell apart amid complaints from both the left and right. All of this and much more has led me to believe that there are better ways to serve my fellow citizens, my beloved state and our nation than continued service in Congress.

Is “bipartisan fiscal responsibility” becoming just a “pipe dream”?  How naive was I when I wrote this over three years ago?

16 Responses to “Another Deficit Hawk Throws In the Towel?”

  1. comment number 1 by: AMTbuff

    Well, at least he didn’t claim he just wanted to spend more time with his family!

    Government needs more elected officials willing to take the pledge to resign when serious attempts to fix the problem are demagogued and then voted down. Voters will remember, and those who resigned will be voted back in when the public is finally ready for action.

    This is what Arnold Schwarzenegger should have done when the public employees’ unions defeated his austerity propositions. Just quit and say “I’ll be back… when you are ready to face the music”.

  2. comment number 2 by: Brooks

    It would be bad enough if “bipartisan fiscal responsibility” were a pipe dream. It’s all the more pathetic that, neither party, nor any members of Congress (with the probable exception of Paul Ryan), nor any president has proposed any plan that achieves fiscal responsibility and makes even somewhat clear the levels and types sacrifices needed to achieve it via that plan.

    In other words, these guys aren’t even willing to propose anything that achieves fiscal responsibility in a way that fits best with their political target market and ideology, let alone show willingness agree to a compromise approach containing a set of sacrifices that fits less well with their respective political target markets and ideologies. For example, those on the right who insist that we solve the problem entirely on the (non-Defense) spending side haven’t had the guts to present a plan with the level of cuts in projected spending on seniors’ entitlement benefits that would be necessary. Similarly, those on the left who insist that we solve the problem just by taxing “the rich” and cutting Defense either aren’t willing to lay out a plan showing the magnitudes of tax increases and Defense cuts that would be necessary, or perhaps some do so but with a conveniently wild assumption about supposed savings from healthcare “reform”.

  3. comment number 3 by: SteveinCH

    Both true. I’m also increasingly concerned with the number of people who are going for the let’s just get the deficit to 3% and then it’s sustainable. That’s a dangerous line of argument because it leaves us balanced on the edge of a knife in terms of making the problem much worse (as we are doing between FY09 and FY11)

  4. comment number 4 by: AMTbuff

    The 3% goal is like a diet where you only break even no days when everything goes right. Throw in a binge here and there, and it’s a recipe for gaining weight.

    Voters don’t appear to want the government to go on a diet, because they keep voting for candidates who tout the tasty desserts they plan to serve.

  5. comment number 5 by: SteveinCH

    I guess I’m still idealistic enough to hope that voters are not really that directly voting for the goodies that are provided. No doubt that’s what Congress believes but I’m not sure it’s true.

    Nobody to my knowledge since the slightly crazy Ross Perot has made a realistic argument about reducing deficits. Paul Ryan comes as close as anyone but his plan is all about the long-term which I think is waiting entirely too long.

  6. comment number 6 by: Brooks

    It is indeed unfortunate that Congress has lost a member who was apparently trying to create conditions conducive to a shift to (or at least toward) fiscal responsibility. The Congressional, statutory budget commission he and others sought would potentially have provided some useful political cover, moved public opinion somewhat, and generally changed the political calculus in the direction of fiscal responsibility. Like his colleagues who supported creation of this commission (and like those who opposed it), he was unwilling to commit possible political suicide by going way out on a limb and acknowledging and advocating the scope and scale of budgetary sacrifices (on spending and revenue sides) that are needed, but like his fellow commission-supporters, he was trying to reduce the political cost of supporting such necessary sacrifices and thus increase the prospects of fiscal responsibility. For this he, along with the other commission-supporters, were not only attacked from both right and left for their willingness to compromise vs. insisting on ideologically pure policies, but also ridiculed by some (e.g., Stan Collender and Bruce Bartlett) for supposed hypocrisy and supposed insincerity, remark’s such as Bruce’s that “In Washington, the term ‘fiscal conservative’ often gets applied very loosely to people who complain about debt and deficits a lot but never, ever put any real deficit reduction proposals on the table–Evan Bayh, I’m thinking of you.” http://capitalgainsandgames.com/blog/bruce-bartlett/1288/real-fiscal-conservative

    Boy, talk about being in a thankless position! Go out on a limb (one one’s own or with some small group of members of Congress) by talking straight and supporting fiscal responsibility without the political cover and P.R. effects of a budget commission and a member of Congress dramatically increases the chances that he’ll get voted out of office (and won’t get anywhere anyway because most of his colleagues won’t go along, cognizant of the political cost). Try to create a commission to hopefully change that political calculus and get Congress and the president to move toward fiscal responsibility, and a member of Congress is attacked from right and left, and ridiculed by folks like Stan and Bruce who are apparently so eager to display their worldly-wise, extreme skepticism and to ridicule someone they suspect is not sincere (lest he get some credit undeservedly) than they are to support those who are supporting action that has the potential to increase fiscal responsibility (and that has negligible costs, explicit or opportunity costs).

    Congrats to Stan and Bruce — if they wanted to insist that members of Congress commit political suicide and to ridicule those who don’t but who seek to change that political calculus to make fiscal responsibility more likely, and if they thus wanted for us to end up with a Congress filled even more with folks who don’t even support such change as an interim step to create political conditions more conducive to fiscal responsibility, job well done.

  7. comment number 7 by: Brooks

    Steve and AMT,

    Re: a plan to get the deficit to 3% and then sustaining it is more than just, in addition to the question of failing to sufficiently allow for adverse developments (the point you guys are making), an important inadequacy of having a plan to hit a particular medium-term target deficit (as % of GDP) without also hitting accompanying longer-term targets is that the drivers of fiscal imbalance will grow stronger as we move from the medium term to the longer term, so if we want to keep debt/GDP from exceeding a particular level in the long term, having that level as the medium-term target may be suboptimal, because it may be preferable to sacrifice more in the medium term to mitigate the level of sacrifice needed in the longer term (for example, how deeply we cut spending per beneficiary on seniors’ entitlements as the 65+ segment grows).

  8. comment number 8 by: Brooks

    Oh, and AMT,

    Re: Voters don’t appear to want the government to go on a diet, because they keep voting for candidates who tout the tasty desserts they plan to serve.

    That reminds me of my “cupcake” analogy a while back — http://economistmom.com/2008/08/does-better-government-require-giving-up-on-deficit-reduction/#comment-1014

  9. comment number 9 by: SteveinCH

    Brooks,

    I totally agree with your point. I think the starting point has to be zero. This is one of the things that is explicitly different between the statutory commission and the President’s version (as rumored since it doesn’t actually exist yet).

    It makes the Presidential commission a far weaker vehicle than it could be even if all sides cooperate in its formation.

  10. comment number 10 by: Brooks

    Another problem with a plan to hit a medium-term target for deficits and/or debt/GDP without accompanying longer-term target(s) is the opportunity for accounting gimmicks that hide liabilities and/or (in effect) shift revenues forward from the longer-term to the medium term, as discussed by Donald Marron at http://dmarron.com/2010/02/14/how-governments-hide-their-liabilities/

  11. comment number 11 by: Brooks

    FYI, good (and amusing) column http://www.thefiscaltimes.org/Issues/Budget-Impact/2010/02/11/Risk-Without-Reward.aspx?p=1

  12. comment number 12 by: AMTbuff

    That reminds me of my “cupcake” analogy a while back

    To a nation of frosting lickers, I say: “Let them eat cake!”

  13. comment number 13 by: Brooks

    AMT,

    LOL. Good one.

    But I say “Make them eat cake!”

    ok, I’d actually say “Convince them to eat cake”, since they can throw out politicians who try to make them eat cake (or take away their frosting, really two sides of the same cupcake), and I’m not (yet) ready to support establishment of a benevolent dictatorship to “save the people from themselves” (as Nixon and/or Kissinger supposedly put it in a different context).

    If somehow the above doesn’t happen, eventually all Americans will get is gruel, and cupcakes will be as rare as [insert folksy Dan Ratheresque analogy here].

  14. comment number 14 by: Tim

    I don’t understand why everyone is linking bipartisanship to the current gridlock.

    Bipartisanship suggests cooperation between 2 or more parties. The current political climate as dominated by 1 party in both houses of Congress. If Democrats were unified, they could push nearly anything they wanted through. Thus, it is not bipartisanship that has caused the recent gridlock.

    Instead, the recent gridlock is a result of infighting within the Democrat party itself. Because neither Obama nor the media want to admit that the current problems are not of the Republicans making, they’ve spun this into mere a failure of bipartisanship.

    The media has failed this country by not holding the politicians accountable for their failures. Its interesting that only a few years ago, 1 party was held to blame for every problem facing this nation. Now, suddenly bipartisanship is to blame . . . .

  15. comment number 15 by: Brooks

    Tim,

    Yeah, yeah, we’ve all heard that talking point many, many times. Yes, it’s true that if every single one of the Democrats had agreed on a healthcare bill, they could have had one, and the same for any other legislation. But it’s just silly to say that it’s not a lack of bipartisanship if every single Republican opposes some legislation and only one or two Democrats also oppose that legislation. I mean, if your house were on fire and putting out the fire required the effort of 60 people, and all but one or two Democrats fought the fire while every single Republican chose not to do so, would you say “Hey, the reason my house burned down has nothing to do with the Republicans. If every single Democrat had fought the fire, it would have been put out”? I doubt you’d say that (at least I would hope not).

    And the above is not any commentary (favorable or unfavorable) regarding what members of each party have done vis a vis any particular legislation or in general; I’m just pointing out the silliness of that talking point.

  16. comment number 16 by: Brooks

    FYI (I do think folks should know about this kind of thing since it affects the quality of discussion/debate on fiscal policy issues and players), I have repeatedly submitted my post upthread on Capital Gains and Games and it still has not appeared. I guess criticism of Stan’s positions and arguments (at least sometimes, perhaps usually) doesn’t make it through the Stan Collender filter (or should I call it the “Stan Collender colander”)