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Friday, February 18, 2011

Paul Krugman: Willie Sutton Wept

Paul Krugman says this much better than I did:

Willie Sutton Wept, by Paul Krugman, Commentary, NY Times: There are three things you need to know about the current budget debate. First, it’s essentially fraudulent. Second, most people posing as deficit hawks are faking it. Third, while President Obama hasn’t fully avoided the fraudulence,... he deserves much more credit for fiscal responsibility than he’s getting.
About the fraudulence: Last month, Howard Gleckman of the Tax Policy Center described the president as the “anti-Willie Sutton” ... because ... Mr. Obama has lately been going where the money isn’t, making a big deal out of a freeze on nonsecurity discretionary spending, which accounts for only 12 percent of the budget.
But that’s what everyone does. House Republicans ... focus solely on that same small budget sliver. ...
The whole budget debate, then, is a sham. House Republicans, in particular, are literally stealing food from the mouths of babes — nutritional aid to pregnant women and very young children is one of the items on their cutting block — so they can pose, falsely, as deficit hawks.
What would a serious approach to our fiscal problems involve? I can summarize it in seven words: health care, health care, health care, revenue.
Notice that I said “health care,” not “entitlements.” People in Washington often talk as if there were a program called Socialsecuritymedicareandmedicaid, then focus on things like raising the retirement age. But that’s more anti-Willie Suttonism. Long-run projections suggest that spending ... will rise sharply over the decades ahead, but the great bulk of that rise will come from the health insurance programs, not Social Security. So anyone who is really serious about the budget should be focusing mainly on health care. ...
What would real action on health look like? Well, it might include things like giving an independent commission the power to ensure that Medicare only pays for procedures with real medical value; rewarding health care providers for delivering quality care rather than simply paying a fixed sum for every procedure; limiting the tax deductibility of private insurance plans; and so on.
And what do these things have in common? They’re all in last year’s health reform bill.
That’s why I say that Mr. Obama gets too little credit. He has done more to rein in long-run deficits than any previous president. And if his opponents were serious about those deficits, they’d be backing his actions and calling for more; instead, they’ve been screaming about death panels.
Now, even if we manage to rein in health costs, we’ll still have a long-run deficit problem... So what should be done?
This brings me to the seventh word of my summary of the real fiscal issues: if you’re serious about the deficit, you should be willing to consider ... higher taxes. True, higher taxes aren’t popular, but neither are cuts in government programs. So we should add to the roster of fundamentally unserious people anyone who talks about the deficit — as most of our prominent deficit scolds do — as if it were purely a spending issue.
The bottom line, then, is that while the budget is all over the news, we’re not having a real debate; it’s all sound, fury, and posturing... And we shouldn’t indulge ... politicians by pretending otherwise.

    Posted by on Friday, February 18, 2011 at 12:42 AM in Budget Deficit, Economics, Health Care, Politics, Social Security | Permalink  Comments (106)

          


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