On Mar 6, 2009, at 3:23 PM, Max Sawicky wrote:
All I've heard are crickets chirping re: the stunning O-budget.
<http://doughenwood.wordpress.com/2009/02/27/radio-commentary-february-28-2009/ >
The outlines of the first draft of Obama’s first budget, though, are more encouraging. To start with, it’s an honest document, which brings the cost of war onto the budget, instead of being covered with the phony emergency resolutions that Bush preferred. Raising taxes on the very rich is a good move. It’s good to see some serious action on greenhouse gas emissions, though I’d much prefer a carbon tax to a cap- and-trade system.
(This is a rare instance where I come down on the side of economists on an issue. Economists argue that carbon taxes produce much more stable and predictable paths for energy prices over the long term, while cap-and-trade systems, which allow polluters to buy and sell their rights to foul the atmosphere, tend to produce a great deal of price volatility. Enviros usually prefer the caps, because they’re direct and mandatory. But the price volatility that such systems give rise to can make it very difficult to plan for the future. But this is a topic for many other shows. See also this article: Cooler Elites.)
The health care fund, $630 billion over the next decade, is a nice gesture, but it’s still not what we really need, which is a single- payer system. We’ll hear more on this from David Himmelstein in about 25 minutes, but single-payer is the only way you can get universal coverage and cost control, because you get the parasitical insurance companies out of the picture.
The deficit is going to be big, very big. It was strange to read on the World Socialist Web Site that these deficits are dangerous; their analysis sounded eerily like those of deficit hawks like Pete Peterson and the Concord Coalition. (Actually it’s more hawkish than this.) Either we have big deficits or everything goes down the drain. Of course if you want the economy to go down the drain, then you don’t like big deficits.
But after the emergency passes—assuming it does, that is—it’s time to get serious about soaking the rich to pay down some of the debt incurred in this vast rescue operation. I’ve long maintained that borrowing money from the rich, which is what deficit spending fundamentally does, is a very poor substitute for taxing them. Big deficits are an essential strategy for getting out of a crisis. But they’re not a good way to run an economy over the long term.
Putting all this together: the budget looks like bigger than baby steps in the right direction, the first serious signs at the fiscal level of a reversal of the priorities of the last 30 years. But only a beginning. And it has to get through Congress.
Oh, and we talk a lot about trillions of dollars. This is, when you stop to think about it, an almost unthinkable number. Here’s an approximation of a trillion. If you counted out a hundred dollar bill every second, it would take 317 years to reach a trillion._______________________________________________
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