Semi-Daily Journal Archive

The Blogspot archive of the weblog of J. Bradford DeLong, Professor of Economics and Chair of the PEIS major at U.C. Berkeley, a Research Associate of the National Bureau of Economic Research, and former Deputy Assistant Secretary of the U.S. Treasury.

Monday, November 27, 2006

I Belong to No Organized Political Party

Matthew Yglesias says: can't we all just get along? In the process he confirms some of my fears.

Matthew Yglesias / proudly eponymous since 2002: Both/And Not Either/Or: With regard to the split between the Economic Policy Institute's populists and the Hamilton Project's centrists, I would hope that both sides of this debate would see that they need each other. On issue after issue, there's simply no way you're going to build a constituency, politically speaking, for Hamilton-style technocratic tinkering unless moderate Republicans and the business community see a credible risk of something more far-reaching happening. On trade, for example, if folks thing anger at the downside of these agreements really may cause the agreements to fall apart then suddenly you'll find its possible to do lots of stuff to mitigate downsides.

Conversely, it's useful to populists for there to be a moderate left out there offering non-sweeping proposals for progressive change. Absent some kind of giant crisis, the odds of congress finding itself inspired to make a giant leap to social democracy are just incredibly tiny. I'm all for universal health care and most of the rest of this agenda, but while some folks are off building support for sweeping reform, it's good to have other people around slicing the salami thinner such that something could actually be achieved in the short run.

One area where the rubber really does hit the road here is the deficit. If Democrats take the view that first we must balance the budget, then we must bring the budget into surplus, and then we can institute new programs, the country is going to be stuck forever in the Reagan-Clinton-Bush loop where the time for new programs never comes. On fiscal responsibility, it takes two to tango, and insofar as the GOP doesn't want to dance, Democrats can't afford to take sole responsibility.

The most interesting part of this, for me, is the last paragraph. Matthew Yglesias is serving notice that, at least as far as he is concerned, Rubinomics is dead. Rubin and us spearcarriers moved heaven and earth to restore fiscal balance to the American government in order to raise the rate of economic growth. But whatwe turned out to have done, in the end, was to enable George W. Bush's right-wing class war: his push for greater after-tax income inequality.

We will try to argue for fiscal prudence and stability in the councils of the Democratic Party. But I fear this is a bellwether--that we will lose, because the choice will be presented as between (i) left-wing things that are good for the nation, and (ii) centrist things that simply enable another round of right-wing class war by the rich and their minions a decade hence.

Ah well:

Hige sceal þe heardra,
heorte þe cenre,
mod sceal þe mare,
þe ure mægen lytlað

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