Needless to say, liberals have been way
too fond of agreeing with each other since Bush came to office, so it's time for a bit of ideological bickering. Over at TPMCafe's BookClub this week, Gene Sperling is discussing
his new book, The Pro-Growth Progressive
, which apparently tries to reconcile liberal and policies to promote economic growth. So, for instance, we get calls for "fiscal discipline," and individual forced savings, along with plans to strengthen health and education, which policies will supposedly make our workforce more "competitive." Oh yeah, and free trade uber alles. (By which I assume he means ending protectionism for blue-collar workers, and not for professionals or pharmaceutical companies.) In other words, DLC policies are the real
pro-growth platform; accept no substitutes!
Now I haven't read Sperling's book yet—it's sitting on my desk and looks good—but color me unconvinced so far. At most, this looks like tinkering at the margins. Yes, yes, as a country we should certainly be investing in universal health care, strengthening public education, and providing other support services for working families and individuals—though not because these policies will definitely boost economic growth, but because they're the bare minimum requirements of a decent society. Any benefits that accrue from acting decent—IWPR, for instance, has argued that providing seven days of sick leave to workers would save companies $21 billion a year—are mere niceties. If they were a drag on growth, we should still do them.
Would better education be good for economic growth, and help people get the jobs they need, as Alan Greenspan would argue? Perhaps at some level, but that's not the core problem here; read "The Job Ghetto" by Katherine D. Newman and Chauncey Lennon and it becomes clear that educated workers in Harlem are being turned away from work they're perfectly qualified to do. Or read this old post. A lack of jobs and wage support, rather than a lack of education, is the thorny brush here. Meanwhile, a single-payer health care system will, of course, relieve businesses of the burden of dealing with health insurance, and that will give GM, Ford, and the rest a tidy boost in profits—and might even make them competitive, as Tom Friedman loves to say—but so long as globalization continues to further inequality, and workers see little of the benefits of economic growth, there's not much reason to care.
So here's where we part ways. Ultimately, the Democratic Party is still toeing the old Newt Gingrich line on macroeconomic policy, which is roughly: let the Fed do its job crushing inflation—and raising rates when unemployment gets "too low"—and get the budget back into balance. Then fiddle with progressive policy. This has been the ideal despite the fact that the late '90s showed that unemployment can go much, much lower than previously thought, and the Fed's rigid enforcement of 6-7 percent unemployment during the Reagan, Bush I, and early Clinton years was a swindle of colossal proportions, keeping wages stagnant. Jared Bernstein and Dean Baker are a must read on this. Meanwhile, the "fiscal discipline" obsession I don't get; if we repealed the Bush tax cuts and spent all of that money on health and education, we would still have those big deficits, but that wouldn't be a problem. Take care of people and our kids will be smart enough to figure it out. After that, it's time to reduce inequality and ensure that any future gains in productivity are shared with workers, rather than fattening corporate profits. There are other ideas but we're running out of space.
Not that the DLC platform—which, as best I can tell, is what Sperling's supporting—isn't worth fighting for. It's good. Great, even. Things like the EITC make a real difference in people's lives. I'd canvas for it. It's probably "good politics" too, for all I know. But what I'd prefer, as I wrote in a book review back in April (which has a lot more examples of the sort), is for the Democratic Party to come up with an actual economic vision, rather than an array of wonky policies to tack onto the current structure of American capitalism. As Jack Kemp always said, if you're going to go for it, you should really go for it. Especially if you're not even running for election.
Continue reading "Pro-Growth Progressives"