Burn Him!

As you no doubt have heard by now, President Obama is expected to announce a non-defense discretionary spending freeze in tomorrow’s State of the Union address. Given that we’re only kinda, sorta on the way to recovery — and that spending freezes are not typical Democratic Party policy — this is obviously a terrible, awful idea that proves the firebaggers right and Barack Obama hates the left and Rahm Emanuel delenda est, right?

It depends on what the meaning of “freeze” is. Indeed, under certain conditions, this could be a great idea.

Before you try me for heresy, read this bit of reporting by Jonathan Chait:

Within the administration, White House budget director Peter Orszag appears to have settled on another solution. Last month, Orszag raised eyebrows when word leaked that he’d asked most cabinet agencies to prepare two budgets: one that freezes spending, the other that cuts it by 5 percent. Many congressional liberals were livid, and, according to multiple sources, Larry Summers’s National Economic Council reacted negatively to the emphasis on the deficit. (“The economic team has a healthy debate about most major issues,” says an administration official. “Getting people back to work is central to addressing the deficit. Similarly, putting the country back on a fiscally sustainable path is vital to confidence in the economy.”) The concern among wonks outside the administration is that clamping down on domestic discretionary spending without touching entitlements would take money out of the economy in the short term while doing nothing to close the long-term deficit.

These same liberals and wonks rejoiced when Obama backed job creation. But there is a logic to Orszag’s gambit, which runs roughly as follows: It’s almost certain that Congress will pass, and the president will sign, a jobs bill early next year, probably in the neighborhood of $100 billion to $200 billion. Given that, and given the difficulty of doing anything about the long-term deficit next year, the administration needs some signal to U.S. bondholders that it takes the deficit seriously. Just not so seriously that it undercuts the extra stimulus.

My guess is that this is the plan — announce, with great fanfare, a “spending freeze” that covers basic departmental budgets and not much else. A freeze that doesn’t come within a furlong of covering the cost of a jobs bill. It’s brilliant politics — you get all the benefits of posing as deficit hawks without any of the actual deep spending cuts (including, it can not be stressed enough, defense) and/or tax increases that a real attack on the deficit would require. Actually, since this is how deficit hawks really behave (when’s the last time Joe Lieberman suggested actually cutting defense? Or Evan Bayh floated a tax hike?), you simply become deficit hawks. And as we all know, deficit hawkishness is A Very Good Thing In Official Washington. Obama’s bound to get great press out of this.

What’s more, eventually, cuts are going to be necessary, as will tax increases. Not now — actually taking on the deficit in the midst of a deep recession would be catastrophic. That said, at some point, some day, we will have to take the deficit on. And that will require dealing with the budget like responsible adults, not Americans. A relatively small, symbolic cut this year to offset a jobs bill and a health care expansion isn’t a bad idea, politically and policywise.

But that’s the key — the Obama Administration can and should find ways to reach out to the center. But they also have to find a way to energize the left. Failing to pass a health care bill would be catastrophic; it guarantees a GOP takeover of at least the House come fall. Passing a health care bill, a jobs bill, and a repeal of DADT while simultaneously limiting other spending growth? That’s a trade that liberals can and should be willing to make.

Of course, if there’s no quid pro quo — if this is a spending freeze just for the sake of freezing spending, and if no jobs bill or health care bill is forthcoming — then it should be rejected out of hand. There’s making a play for the middle, and then there’s rank stupidity. I’m going to bet that the Obama Administration isn’t stupid. But we’ll see.

This entry posted in Economics and the like, The Obama Administration. Bookmark the permalink. 

27 Responses to Burn Him!

  1. 1
    Charles S says:

    Nope.

    This may be great optics for the Washington chattering class, but it is a fucking disaster as an actual policy (actually, it is shit optics as well, now that it looks like an obvious panic in response to Brown winning in Massachusetts). The non-military, non-social security portions of the government do critical work, have been chronically underfunded for a decade or more, and do not need to suffer cuts to pay for Obama’s optics or wildly out of control military spending and Bush’s massive tax cuts. Remember that a budget freeze is an effective budget cut, due to inflation and a growing population.

    Do you understand that you are advocating for a cut in FEMA’s effectiveness, a cut in the FDAs effectiveness, a cut in OSHAs effectiveness, less money for section 8 housing, less money for NIH and NSF (National Science Foundation) research grants, less money for the national park system? Do you care?

    It isn’t even good optics, since the congressional Dems will probably tell Obama to shove it, and restore reasonable and necessary funding increases. So the Republicans will get an extra bat to beat up on congressional Dems (the ones who are actually running in elections this year, remember), and Obama will get painted as ineffectual again.

  2. 2
    RonF says:

    Love the picture.

    As far as the bill goes, the devil is in the details.

  3. 3
    Robert says:

    It’s a good idea, but after he finishes buying off Democratic Senators with billion-dollar deals exempting their states from any spending cuts, and finishes buying off his political constituencies with billion-dollar deals exempting certain kinds of workers from any jobs cuts, it’ll end up provoking a backlash and ending with the election of more Republicans.

  4. 4
    ts says:

    the TNR item is by Noam Scheiber.

  5. 5
    Silenced is Foo says:

    It is a clever approach – I know that there’s a lot of resentment in the private sector that public sector employees are getting the same raises and security they’ve always had, while private employees are lucky if they have the same job and pay they had two years ago. Tightening the public belt would show some sympathy to the working stiffs and throw a bone to the TEA partiers.

  6. 6
    RonF says:

    Within the last 5 years I’ve gone through one year where I got no raise and one year where I got a 5% cut. Lots of other people I know have the same story. Unless, of course, they work for me via the government, in which case they get a raise every year and more holidays than I do.

    I and everybody else who works gets regular reminders of this when we come home from work, reach into our mailbox and find … nothing. “Oh yeah. Government employees get this day off. And I had to go to work. To pay them ….”

    This needs to be fixed. People who work for me should be subject to the same economic issue I have. Layoffs, pay freezes, pay cuts, etc. And if the unions stand in the way then break the unions. I’m amazed that only about 9% of private employees are unionized but 50% of government employees are.

  7. 7
    Jake Squid says:

    Misery does love company.

  8. 8
    Charles S says:

    Yes, because nothing helps end a recession like laying off more people. If only the government would have added a few million more to the unemployment rolls last year, maybe we could have turned this recession around a little faster. And cutting basic services like food stamps and unemployment would have done even more to get the country working. If we just stop coddling those lazy unemployed people, they’ll start accepting all those jobs that are out there that they’ve just been turning up their noses at.

    Maybe if you formed a union Ron, you could get a few more days off each year (oh, I know, your work is so critical that if you took more days off society would crumble!). No, damn the evil unions for getting us the forty hour work week and 2 weeks off because some of them have managed to get 4 weeks off for their own employees. And damn the Federal government for having Federal holidays.

  9. 9
    RonF says:

    I don’t damn the Federal government for giving it’s employees holidays. I damn them for giving them more holidays than private industry does.

    If the Federal government spent less money then we’d have to pay less money in taxes, which would enable us to either save more so that the banks would have more money available to loan people trying to expand businesses and hire people, or spend more on goods and services so that companies would do more business and have a need to expand their businesses and hey, hire people laid off from the government to do something productive.

    I can’t speak to where you work, but where I work my management made it exceedingly clear that [fewer_workers] != [less_work_gets_done]. Exceedingly clear. So I don’t see the “cutting basic services” argument as particularly valid even granting for the sake of argument that food stamps, etc. are basic services of the government.

    As far as unions go, we’re not talking about what unions in the distant past have done. We’re talking about what government employee unions are doing now. They had nothing to do with securing 40-hour work weeks and 2 weeks of vacation for people. That battle was long over before JFK signed the executive order permitting government employees to unionize.

    40-hour work week, eh? Gee, I could use a few 40-hour work weeks. It would be like a vacation! I do get more than 10 vacation days a year, but then I’ve got 14 years of tenure with this company.

  10. 10
    AlanSmithee says:

    I’ve been banned from posting comments on Alas. Banned, banned, banned. What will it take for me to remember that? Do the mods really need to edit out my arguments and replace it with nonsense about my being banned before I’ll get the point?

  11. 11
    Jenny says:

    Charles S. is right: http://amleft.blogspot.com/

  12. 12
    Charles S says:

    I always love how people brag about there shit working conditions.

    Ooh, forty hour work weeks, I wish I had those! Not enough to unionize or anything, I just want to show how cool I am that I work hard, hard I tell you!

  13. 13
    RonF says:

    I work about a 50-hour week. Everyone bitches about their working conditions; that’s what keeps Dilbert in business. But to be serious I’m damn glad our company is doing well enough that there’s that much work to do. Not everyone can say that – like my own brother, for example. He’s getting his hours cut back (and unlike me he’s paid by the hour with job-related bonuses).

    The last thing I want in here is a union. I was in one once, when I was a clerk in a grocery store. I went to a meeting of the union because we were going to vote on a new contract. The union bosses would not let me (or anyone else) see a copy of the contract, wouldn’t tell us how much we were going to get paid and then stood up in front of the meeting and told us that the new contact was the best we were going to do and that we needed to vote for it. When I asked questions about why I couldn’t find out what I was going to get paid the old hands at the meeting started chuckling and I was marked down as a troublemaker – with consequences at work. We voted the contract down. I don’t know what the final denouement was because in the few weeks afterwards they first hashed up my schedule to make it hard for me to work and then fired me on trumped-up charges.

  14. 14
    RonF says:

    Amp – did you have to write that or do you have it in a doc somewhere where you can just cut and paste it?

  15. 15
    RonF says:

    Damn, Jenny: you elect a guy with no particular lasting accomplishments anywhere he’s been, who’s almost never held a job in the private sector, whose relatively brief legislative experience was mostly in a body where he set a record for voting “Present” and where his leadership experience was minimal and then you’re surprised that he’s not getting much done and is NOT, in fact, making hard choices and exerting skilled leadership to get us there?

    It’s one thing to argue about policy choices and political principles. You and I are hardly likely to agree on those. But anyone should have realized that this wasn’t the guy to get you there. You guys fell for the hype. Where was the history that led you to expect he was going to be able to get the job done? There’s no way to tell now, but I’d guess that if Hillary had been elected she’d have been a lot more pragmatic about what she could get done and would have been a lot more able to actually get it done. She’s seen the process up close and personal.

    Of course, from my viewpoint, if someone espousing leftist ideals was going to win I’m glad it was someone ineffective. It really is interesting to read all the angst on the left about Obama these days.

  16. 16
    nobody.really says:

    Within the last 5 years I’ve gone through one year where I got no raise and one year where I got a 5% cut. Lots of other people I know have the same story. Unless, of course, they work for me via the government, in which case they get a raise every year and more holidays than I do.

    I and everybody else who works gets regular reminders of this when we come home from work, reach into our mailbox and find … nothing. “Oh yeah. Government employees get this day off. And I had to go to work. To pay them ….”

    This needs to be fixed. People who work for me should be subject to the same economic issue I have. Layoffs, pay freezes, pay cuts, etc. And if the unions stand in the way then break the unions. I’m amazed that only about 9% of private employees are unionized but 50% of government employees are.

    Why shouldn’t government employees get better compensation than you do? They’re clearly smarter than you are; after all, they were able to figure out how to get these cushy jobs, and you weren’t.

    I’m an attorney working for a regulatory agency. We regularly see attorneys leaving government service to join industry; few return to government service, all our cushy perks notwithstanding. (Ok, I recall one attorney — Don Low — who would switch from running the Kansas Corporation Commission to working for Sprint Corporation, headquartered in Overton Park, Kansas, depending on whether the Democrats or Republicans had won the last election.)

    Seriously, labor markets are reasonably competitive. If you think government employment is so great, why don’t you quit your job and come work for government?

  17. 17
    RonF says:

    Seriously, labor markets are reasonably competitive. If you think government employment is so great, why don’t you quit your job and come work for government?

    For one thing, there’s not a lot of call for what I do in government. For another, I have no political sponsors. I am not active in a political party and have no relatives in elected or appointed office. That makes it pretty difficult to get a job in government.

    Why shouldn’t government employees get better compensation than you do?

    I haven’t addressed the amount of money that government employees make. I’m saying that if the private sector is laying people off and reducing wages and benefits, the people who work for those of us in the private sector should be subject to the same thing.

  18. 18
    nobody.really says:

    Ok. Why?

  19. 19
    Jake Squid says:

    For another, I have no political sponsors. I am not active in a political party and have no relatives in elected or appointed office. That makes it pretty difficult to get a job in government.

    What a bizarre concept of how one gets a government job. Unless, I guess, you believe that the only government jobs are ones to which a person is appointed. I’m sure that my several friends with government jobs that required no political activism or nepotism will get a nice laugh.

    Popes, OTOH…

    No wonder you are so anti- “big government.” I would be too if I had your unrealistic vision of how government works.

  20. 20
    Robert says:

    At Ron’s professional level, most government employees are either appointees of one variety or another, or people who have spent many, many years in Federal service. You don’t just walk in the door and apply to be a GS-16, usually.

    As for “why”, Nobody, how about: “so the private sector people paying the government people’s salaries don’t get pissed off and stop”.

  21. 21
    Jake Squid says:

    At Ron’s professional level, most government employees are either appointees of one variety or another, or people who have spent many, many years in Federal service. You don’t just walk in the door and apply to be a GS-16, usually.

    I find it hard to believe that most gov’t employees at RonF’s professional level are appointees. Unless you’re saying that Ron is at a level where he would be high in the chain of command in a federal department. I’m not sure what info RonF has given us to suggest that this is true.

    It isn’t difficult to get into government employ now if he doesn’t mind lower income. Just because he can’t start at the top doesn’t mean he can’t benefit from all those perks that he begrudges federal employees.

    In any case, RonF had the choice to pursue (or not) government employment at the beginning of his career and he chose the world of private business. He could have changed his mind at any point during his career. His complaints about it now sound like sour grapes of the imagination.

  22. 22
    Ampersand says:

    As for “why”, Nobody, how about: “so the private sector people paying the government people’s salaries don’t get pissed off and stop”.

    Oh, yes, the threat of going Galt. How would the world ever survive if whiny entitled white men all quit working?

    I don’t buy for a moment that you and Ron and others are about to give up the comforts of civilization and go off the grid. Short of that, all your threat amounts to is “we’ll campaign to reduce taxes without regard to the effect on the deficit that we pretend to be concerned with” — but you’re already doing that, so threatening that doesn’t carry much weight.

  23. 23
    nobody.really says:

    I’m constantly amazed at people’s grasp of labor compensation. Some jobs provide more money. Some more stability. Some more physical exertion. Some more fame. Some more risk. Comparing any one aspect of compensation in isolation, without the others, seems like a recipe for self-delusion.

    I guess I could accept bearing the same labor-market risks that my private-sector brethren bear — provided that I also receive all the same labor-market benefits that they have received during my decades in service. In short, lawyers in the private sector receive VASTLY larger compensation, but also bear some greater risks.

    I’ve chosen a profession with lower compensation and lower risk. I’ve made my choices with open eyes, and I blame no one for the consequences of my choices except myself. I find it regrettable that so many people feel otherwise.

  24. 24
    Robert says:

    Maybe I’m overestimating Ron’s professional level of success. I doubt he feels like posting his 1040.

    I’m not threatening to go Galt. I like canned stew, but it gets old, and I’d miss the Internet. I’m threatening to cut off the tap at the legislative level. (Well, not me personally. Yet.) If ‘we the people’ think their government workers are getting too much joy from their compensation, we’ll vote to make their lives less happy. That would be a bad thing to have happen; we shouldn’t be at war with our own government. So let’s not make it necessary.

    I don’t think that government workers should be subjected to labor market risks like arbitrary pay cuts or some of the other indignities that Nobody rightly assigns to the private marketplace. But there are economic realities as well, which government employees must bow to. I’ve been a government employee, and there were years when we got no raises and years when we got no raises and our benefits plans for health and retirement got more expensive. That was sad for us, but that was the reality of the state budget.

    And reality may require pay cuts as well, depending on the situation. I understand the balance between freedom, income, and stability; I’ve worked as an independent entrepreneur, a government worker in a safe nest, and as a capitalist tool of the corporate overclass, for roughly equivalent periods of my life. And as a general principle, I agree that government work ought to be one of the stable pools of technocratic careerism, in exchange for perhaps a slightly shoddier lifestyle than can be enjoyed as a Halliburton fast-tracker.

    The question then is, what are the data. If a lawyer in your government office is making 48% more, counting all reasonably consensually recognized wages, salaries, and benefits, than one of equal skill and experience in a high-quality tier of the corporate world, then maybe we need to adjust what lawyers in your office make. I profess no knowledge of the facts on the ground, I merely submit that they exist and are material.

    The larger question is how many of those reasonably-but-not-excessively-paid government lawyers we want.

  25. 25
    Dianne says:

    You don’t just walk in the door and apply to be a GS-16, usually.

    I found a whole slew of GS-15 jobs in 3 different branches of the government that I could at least apply for (and probably get) without any patronage at all. I’ll link if anyone’s curious and/or skeptical.

  26. 26
    Sheelzebub says:

    Where did people get the idea that government workers get paid boatloads of cash? One of our local papers ran a story (and had it on their website) that listed government employees and their salaries; the overall tone was to shame them and get people to pillory them for making so much. Oh, please.

    Upon seeing it, several people told a friend of mine who is a government employee that they were quite surprised at how little she made, and how she should go into the private sector.

  27. 27
    Robert says:

    Stories like this one:
    http://www.usatoday.com/news/washington/2009-12-10-federal-pay-salaries_N.htm

    Interestingly, this supports, to a degree, both sides of the argument. The average federal salary is 70-something k, the average private salary 40-something. So government workers get way more money! But they get paid somewhat less on average for comparable work (26%, according to a figure pulled out of who knows where in the story). So government workers get boned!

    Basically the government hires a lot of high-end professionals, more than it used to, and that’s why the average salary is high. But the typical worker also gets less than s/he would in private sectors OVERALL – something that I imagine varies a lot from job to job.