According to Prof Friedman's analysis, Bernie's economic program would increase Federal Govt spending by $14.5 trillion over 10 years.
Table 1.
Sanders program for broadly-shared prosperity: additional federal spending
Program 10 Year fiscal impact
($billions)
Rebuild America Act $ 1,000
Employ Young Americans Now $ 6
Social Security benefits increase $ 491
Social Security indexation $ 25
Protect Private Pensions $ 29
College for All $ 750
Paid Family and Medical Leave $ 320
Climate change, energy efficiency, climate
resiliency, clean energy worker transition4
$ 1,198
Medicare for All $ 10,6825
Total over 10 years: $ 14,500
http://www.dollarsandsense.org/What-would-Sanders-do-013016.pdf
15 comments:
Isnt the Friedman guy saying $3.8T additional over 10 with 30% of that reprogramming?
Leaving us 70% of the $3.8T additional?
Matt- all of those are new or increased spending programs.
So combined Health care spending by federal Govt would be like $2.3 trillion instead of 1.2T
Think of the response in working people and financial markets to the rise in growth, incomes and inflation. Of course, Sanders would have congress to fight with, and very little would actually happen, but if it did...
Growth would instantly rise to 8 or 9%.
Inflation would jump from 2 to 6 or 7%.
Interest rates would have to go to 7-10%
Europe, China and Japan would be yanked out of their malaise with US growth surpassing China's.
Incomes would rise faster than capital gains for the first time in decades.
Increased social spending would boost consumer confidence.
Rising incomes would boost consumption and start a new credit expansion and business investment cycle.
Safe to say, markets would have a cow and workers would be in short supply.
Also need to figure both normal population growth and anticipated added growth from immigration to supply needed workers not available domestically, which requires anticipating productivity growth, too. The present analytic approach tends to be simple and static, whereas the socio-econmic system is complex and adaptive. Bernie's program could be a game-changer globally now that China is in the rebalancing phase.
Freidman claims the Sanders budget would run a surplus after a few years. :'(
No one can really predict that kind of stuff, but it's consistent with the Congressional Progressive Caucus budgets that have been presented over the years, and consistent with Bernie's voting record and rhetoric.
Like most "progressive" Democrats, Bernie is a deficit dove, not a deficit owl. If you're looking for a socialist, he is not it. If you're looking for functional finance, he is not it.
Of course most of Bernie's domestic spending programs would be dead on arrival in Congress, along with most of his tax-the-rich proposals. Perhaps R's would go along with some Keynesian militarism, and I believe there is an unspoken consensus on both sides of the aisle that O-Care is flawed and needs to be tweaked, though national single payer is a pipe dream. More likely some variation of Bernie's 2013 proposal that would delegate health care administration to the states, and R's would insist on giving states the option to privatize the whole shebang.
The only kind of tax increase Grover Norquist will allow is a regressive tax, like Bernie's proposed regressive tax increase to "pay for" health care and sick leave, or Bernie's proposed carbon tax.
So it's conceivable that a President Bernie might be able to pass some sort of expanded health care system "paid for" with regressive taxes, and perhaps some sort of regressive carbon tax. If so, we may end up with less aggregate demand. :'(
R's are not going away in Congress. At a minimum they are expected to maintain control of the Senate. A more pragmatic economic plan might be something along the lines of Mosler's FICA suspension, and incrementally expanding Medicaid and Medicare with Uncle Sam picking up the full tab so states have no reason to object.
This should help Sanders with minority voters:
http://www.chicagotribune.com/news/local/breaking/ct-bernie-sanders-1963-chicago-arrest-20160219-story.html
There's just no way the GOP will lose the house so none of these policies will happen. I just wanted to point out the scale of the proposals. Were talking a 50% increase in govt spending. To me that's great but i can see how its a total shock to the system given the current overton window. Just goes to show the sorry state of our political and economic imagination.
"Were talking a 50% increase in govt spending."
If there's the real capacity to absorb it, then it can be a 100% increase, or 200%. It doesn't matter.
The problem again is analysing the programme in terms of numbers, not stuff. Numbers are irrelevant for the federal government.
Talking in terms of numbers simply reinforces the assumption that there is somehow a shortage of numbers.
Talking in terms of stuff. Then you can see where it is currently deployed, where the new stuff you need is coming from, and what the old stuff you need to stop happens to be.
Public health care requires co-opting the private health care system. That's what we had to do here in the UK where the GPs are actually all self-employed contractors to the NHS. The bit you are actually eliminating is the financial nonsense, and all the processing and sales operations that are just inefficient baggage.
Well this is from the Freidman thing Tom posted down thread:
Freidman: "Sanders’ proposals for infrastructure, early-childhood education, higher education, youth employment, family leave, private pensions, and Social Security would total over $3.8 trillion over 10 years. While this is a large number, it would be barely 6% of federal spending for 2017-2026."
So where does the 14T come from? Doesnt look like that is Freidman's numbers...
Matt-
its on like the first page. You're a smart guy, you can find this table which I literally just copied and pasted. In fact, its table #1.
Since MMT as a whole does not believe in the balanced budget multiplier, why are we concerned with how much Bernie wants to spend? Shouldn't we instead focus on how much Bernie wants to increase or decrease the budget deficit?
What I'm picking up from Bernie's plan is PAYGO. And then there is his horrible proposal to increase regressive taxes, doubly horrible because it might actually pass a Republican Congress.
"Liberals" are projecting their own values onto Bernie just as they projected their own values onto Obama in 2008, and just as they projected their own values onto Syriza.
Well then WHAT is Friedman talking about?
"why are we concerned with how much Bernie wants to spend?"
Maybe because we are not stupid?
This is one economist's projection. As we know, economic projections are mostly GIGO. (The reference of his critics to the Democratic Party's "best traditions of evidence-based policy making" is amusing. ;)) And, OC, Congress will never pass such a program, so we will never know whether Friedman is right.
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