Five People Politico Should Have Called for Its Terrible...

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DECEMBER 11, 2012

Five People Politico Should Have Called for Its Terrible Article on Fixing the Economy

If you thought something was missing from Monday's Jim VandeHei and Mike Allen piece in Politico -- the one about the “half dozen or so big things” that people “in the most powerful positions in Washington agree in private ... could put a rocket booster on the U.S. economy” -- then you were not alone. As many commentators, such as New York's Jonathan Chait pointed out, VandeHei and Allen failed to find a single person worried about, say, income inequality. And the word “unemployment” appears but once, enveloped in a plea from Bank of America CEO Brian Moynihan for Obama to commit to tax reform. Instead, the authors lard the piece with quotes from CEOs, hedge funders, and moderate-to-conservative politicians, who counseled items like tax reform, Medicare and Social Security cuts, and fewer immigration restrictions.

So we called up the people who were left out of Politico's consensus: labor leaders, economists, and think tankers who focus on issues like housing, health care, and economic equality. We asked them to read the Politico piece (one pleaded, “Do I have to finish it?”) and asked them which good ideas were left out. Their answers, edited, are below.

Larry Mishel - President of the Economic Policy Institute

"This is the Very Serious Peoples’ list of priorities?

“What the American people want is more jobs, now, to quickly lower unemployment. Where on the agenda is a higher minimum wage? Where is giving people the right to organize a union and bargain when they want that? Where on this agenda is preventing employers from bringing in guest workers and exploiting them and undercutting wages? Where is increasing public investment in infrastructure, education, and R&D? Where are we in terms of corralling CEO pay and improving corporate governance? Those are just the basics. Tax reform? Really? Lowering your rates by making somebody else’s deduction disappear? We should expend a lot of effort on that? When incomes have declined every year for four years and wages haven’t improved in ten years for hardly anybody? And corporate tax reform, which they say should be revenue neutral, when we need more revenue? This is not an agenda the American people want. This is the Very Serious People’s agenda.”

Joan Entmacher – Vice president and director of family economic security at the National Women's Law Center

“It is perhaps a set of policies that would create an even bigger boom for CEOs and their corporations. But it’s certainly not a way to create a boom economy for the vast majority of Americans, especially those who have been through the hardest times. I think making investments now that create jobs and strengthen the economy over the long term are what’s important. Investing in early childhood education, for example, where we’ve seen cuts made in the majority of states in the last couple of years. Those cuts mean cuts in livelihood overwhelmingly for women who provide childcare, and for the parents who rely on childcare assistance to work in the paid labor force. And child care not only means more jobs, but it also helps provide children with high-quality early learning experience so they enter school ready to learn and poised for success. Medicaid—about 80 percent of the jobs produced by Medicaid are jobs held by women. So when you discuss cuts to Medicaid, which this group of people would like to see, you’re talking about cuts to jobs for women. It’s the jobs we need. Corporate profits are doing fine.”

Richard Trumka – President, AFL-CIO

“A good place to start would be President Obama’s American Jobs Act, which includes immediate investment in infrastructure and help for states to avoid layoffs of teachers and first responders. Beyond that, we need sustained investment in infrastructure of a much greater magnitude, along the lines suggested by Professor Jacob Hacker in Prosperity Economics, if we want to successfully make the transition to a 21st century economy. And we cannot put off any longer a full-fledged assault on wage stagnation, which is the root cause of our economic problems.”

Sheila Crowley – President of the National Low Income Housing Coalition

“The federal government should invest in jobs and putting people back to work. And I know that’s standard liberal fare, but it’s worked before and there’s no reason for it not to work again. Tinkering with tax policy is all well and good, but it doesn’t get you on the same scale at all. We have whole parts of the country where people are losing their association with the workforce, they’re losing their sense of being contributing citizens, their prospects are so dim, and the best they can look forward to is being old enough to apply for Social Security. That is not how you make a country great.

“We need to do something serious about lifting up wages at the low end, and not having there be such a disparity between the rich and the poor. And an area where were have completely missed the boat on in our attempts to capture recovery is the housing circumstances of low income people. The billions and billions and billions and billions and billions of dollars we’ve poured into shoring up the housing industry, none of that is seriously making its way to homeowners who’ve lost the value of houses because of the recession, or to renters in the low-wage workforce. And the federal government should be putting a lot of money into expanding the supply of federal housing, which brings all sorts of rewards—construction jobs, ongoing jobs in the operation of the housing, and people who are much more likely to succeed because they’re in stable housing."

Chad Stone – Chief economist at the Center on Budget and Policy Priorities

“Let me start with the tax reform point. What you often hear from tax reformers is that you want to lower rates and broaden the base in a revenue-neutral way. And what that misses, because there are some economic efficiency gains from that, is we need policies that bring down the budget deficit. … They’re missing the bigger point that it’s almost surely the case that reducing the deficit has a bigger impact on the economy than lowering marginal tax rates in a deficit neutral fashion. It’s not inappropriate to talk about supply side policies, but the problem we face now is one of weak aggregate demand.

“As for things that were left out, there is lots of stuff on the spending side of the budget that is an investment. Simply cutting spending without thinking about why you’re doing it is not a smart policy. That’s why sequestration is meant to be an incentive to be smart about how you approach the budget—because it’s such a crude approach. The other thing is, we have continually had this approach, one of cutting from discretionary spending, to the point that, we’re already made these cuts. There’s not much left to cut.”

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posted in: politics, new york, new york, washington, washington, bank of america, brian moynihan, jim vandehei, jonathan chait, larry mishel, lloyd blankfein, mike allen, medicare, the plank

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