As a Daily columnist, I’ve had to get used to public criticism of my opinions. When I write about gay rights, for instance, I expect at least three angry emails likening gay marriage to polygamy. And I’ll admit that I’m not always a true expert on the subjects on which I write. But when it comes to the economy, conservatives have proven that you don’t need to be an economist to weigh in on the discussion. And, though what I have to say will surely rouse criticism from some readers, it’s time to get real about the economy.
The public debt currently stands at just over $12.4 trillion, according to the Bureau of Public Debt. That number takes into account the accumulation of the national budget’s yearly deficits. Though people often correctly cite surpluses under President Bill Clinton, the overall public debt still stood somewhere between $4 and 6 trillion under his administration, as a sum of previous deficits. The debt he left to his successor, President George W. Bush, was $5.727 trillion.
Rather than slimming to a more “conservative,” budget, the day President George W. Bush left the White House, he handed President Barack Obama a debt of nearly $11 trillion. Half of that was inherited, so I’ll ignore that. Of the other half, a small fraction surely resulted from the reduced tax revenue and increased governmental precautions during the recession. That may have been unavoidable.
But Bush was adamant that slashing taxes for the rich would create trickle-down stimulus of the private sector. So he cut taxes, forcing the government to deal with far less tax revenue, effectively making it poorer. Additionally, we entered into two wars, which took a further toll on the public pocketbook. Now Obama and Congress must deal with all of the above, which will cost a lot of money. In addition, they have to focus on massive unemployment.
A basic measure proposed by Democrats and widely supported by economists is the stimulus package. Congress passed one early last year at a price of $787 billion. As a result, 2.4 million American jobs were saved or created in 2009, according to the Congressional Budget Office.
Yet conservatives say that spending $787 billion was irresponsible when the debt was already so large. But they continue to support tax cuts, even when the government is broke.
It may be confusing to understand how spending can be a good thing when the country has limited funds. So think of it this way: the country is like a college freshman in desperate need of a student loan. In order to succeed in an increasingly competitive global economy, that student needs an education, but cannot pay for it by himself. If he can’t get a loan, he’ll have to quit school and work unsatisfying menial jobs for the rest of his life. But if he does get one, once he receives his degree and gets a good paying job, he’ll be able to pay off his debt.
A stimulus package works just the same way. Once it gets citizens back on their feet, they pay the country back by contributing to the GDP and tax revenue. Though it adds to the current public debt, it is unlike other spending because it paves the way for future government revenue.
And that brings me to my last point, which may be the most controversial, though it’s probably the least complex. Americans need to start paying more taxes. There. I said it. Policymakers and real economists will have to decide whether these taxes are sales, income, value-added or something else. But the bottom line is that taxpayers have been on a holiday that this country can no longer afford. Paying higher taxes doesn’t mean that the country is, God forbid, becoming socialist. It just means that our country is hurting economically and it’s our civic duty to help out.
So, to recap, we need more stimulus and more taxes to get us out of the economic mess we’re in — which, it turns out, was not Obama’s fault. Yeah, I’m trying to simplify things. And indeed, I am unquestionably to the left — to a fault, some will say. But in a sea of talking points and complex analyses, not to mention populist conventions and conservative talk radio, the above points are necessary to outline, even if I only scratch the surface in this column.
But instead of barraging me with attacks that I’m a just a dimwitted liberal, if you’re critical of what I’ve said, I urge you to write a viewpoint and submit it to the opinion page. Bring it on.
Matthew Green can be reached at greenmat@umich.edu.